$5,000 rule
A quick HVAC repair-or-replace test: multiply the unit's age by the repair quote — over $5,000 means replace.
The $5,000 rule is a rule of thumb for deciding whether to repair or replace heating and cooling equipment. Multiply the system's age in years by the cost of the proposed repair; if the result is more than $5,000, lean toward replacement, and if it's under $5,000, the repair is usually the smarter spend. A 5-year-old AC with a $700 repair scores 3,500 — fix it. A 12-year-old AC with the same $700 repair scores 8,400 — start pricing a replacement, because you're pouring money into a unit near the end of its [service life](/glossary/service-life). It pairs naturally with the [50% rule](/guides/repair-or-replace-cost-calculator): if a single repair costs more than half of a new unit, replacement almost always wins. Our [repair-or-replace calculator](/guides/repair-or-replace-cost-calculator) runs both tests at once.