When it is time to replace your car you may be tempted to rush out and buy a brand new one with all the bells and whistles. The fact is that you need to look closely at whether a new car is necessary or a good used car would provide you with the same benefits. The average car costs over $30,000 and the average person purchases 13 cars over their lifetime. Imagine the money you could save if instead of buying 13 new cars, you chose 13 gently used vehicles.
New Car Depreciation
New cars begin to depreciate the minute you drive them from the lot. Within minutes, the car you just spent $30,000 to buy will lose $6,000 in value. By the end of that year, your car will be worth 30 percent less, or $9,000. By the end of three years, depreciation can be almost half what you paid for the car. If you buy a car new for $30,000 and sell it three years later for $15,000, you have essentially lost $15,000 due to depreciation. If you had purchased that same car used for $15,000, three years later you could sell it for $10,000 as depreciation slows as the car ages. That means the car only cost you $5,000 in depreciation costs.
Used Car Stigma
In the past, buying a used car was referred to as “buying someone else’s problems.” There are two reasons why this is not true any longer. Today, cars are far more dependable than they used to be. In fact, it is not unusual for a car to go more than 100,000 and not need any major repair. As long as the previous owner kept up with regular maintenance like oil changes, tire rotation and brakes, a used car is just as reliable as a new car. In addition, many cars can go much longer between routine maintenance with some manufacturers recommending oil changes every 10,000 miles rather than every 3,000 like older models required.
There are several money-saving reasons why you should consider a used car as well. Often, a used car costs less to insure as the car has lower value. In some states that use the value of the car to determine the cost for registration, your renewal rates could be lower each year. Used cars often have lower prices so a more expensive model may cost the same as a less expensive model than if you purchased new.
Benefits to New Cars
Although there are many benefits to buying a used car, purchasing a new vehicle also has some benefits as well. You don’t need to have a new car evaluated by a mechanic and it is easier to figure out what you should pay for the car. Automakers often offer incentives to encourage buyers to choose new vehicles and new car loans often have better interest rates than used cars. Depending on how old the used car is, you may not be able to get advanced technology like built-in GPS, USB ports or Bluetooth capability like you can in a new car. Although some dealers offer limited warranties on used cars, if your new car has an issue in the first 36,000 or three years, the warranty will cover any repair.
If you are considering a car purchase, bring your current vehicle into our shop for a complete review. If you have decided to purchase a used car, our mechanics are happy to take a look at the vehicle before you buy and identify any problems you could encounter. Schedule an appointment today by calling or filling out the easy online form.