Not sure which is the right decision re: replacing our car

biomaj5

So we're supposed to get $2200 for the cavalier, $3200 if the other company admits fault and we get our deductible back. I had been set on just buying a cheap used car that we can pay for out of the insurance money, rather than getting another car payment (the cavalier was paid off). We had been planning on buying a new (to us) car in the next 2 years or so. We are actively paying off our debt, which is another reason I didn't want another car payment. We have 4 jobs between the 2 of us in order to pay off debt. We don't have any other savings to pull from.

I was discussing it with my coworkers, and my lab manager thought that we should just go ahead and buy a used car from a dealer, because we were going to buy one anyway, and who knows what kind of repair costs we'd get with a car out of the classifieds. She thinks that that would be cheaper in the long run.

I just don't know what the right decision is. I know that it's our choice/decision to make, but what would you do? Any advice?