New or Used? It’s the age old question.
Deciding on whether to buy a new car or a used car is the very first decision a
consumer makes when embarking on the car buying journey. Which one works for
you will depend on your personal preference and financial situation. Its
deciding what’s a value to you. Do you value status and the newest features or
do you value a good deal more? In our humble opinion (and not biased whatsoever)
buying a used car like one of these great used cars is by far the best idea, but in this
blog we’ll discuss the benefits and pitfalls of both. Can you get an objective
opinion from a used car dealer’s blog on buying new or used cars? We’re not
sure but we’re going to try and find out!
Advantages of Buying a New Car
Hello!? It’s NEW! There’s nothing like a new car. It’s
hot off the presses. It even smells
new. It’s got all the newest gizmos and gadgets. It’s a status symbol. It
screams success and stability.
Again, it’s NEW! The
reliability of a new car can be an advantage. It is a new car with all new components. It doesn’t have the benefit
of being road tested but it is likely covered by a fantastic manufacturer’s
warranty. A new car is also protected by legislation like Lemon Laws.
It’s yours… New cars pretty much come made to
order. Want a bare bones model with just the necessities to save a couple
bucks? You can get it. Want every option? Something in between? No problem.
It’s easier… It’s easier to buy a new car. To buy a
used car, you have to scour through classifieds to find what you want at the
right price. You have to spend time going dealership to dealership and have the
vehicle checked out prior to purchase. With a new car, you’re paying pretty
much the same as everyone else and getting the same thing. Sure there’s
discounts and dealer programs but there’s a retail price to gauge from. One
brand new Altima has the same value as another with the same options. Two used
Altimas can be the difference of 100,000 miles and who knows what else.
Advantages of Buying a Used Car
Choices? The choice to buy new or used may not
even be a choice at all. If you don’t have good credit, a new car may not even
be an option for you. And without excellent credit, you can cross off the no
down payment and low interest rate in the “Pros” column…
And every well intentioned Uncle’s
favorite advice… Depreciation…
Depreciation is the most significant factor to weigh when deciding new or used.
What’s depreciation? Depreciation is defined as “a reduction in the value of an
asset with the passage of time.” To a new car buyer, depreciation means the
vehicle you paid all that extra money for will lose value quickly and in the
case of new cars that value loss is immediate. Trusted Choice has created an
excellent infographic that clearly explains how new cars lose value. You can
check it out here. You lose 11% of your new car’s value just driving off
the lot. That’s 11%. Like eleven percent!
The $20,000 you just spent to purchase that vehicle has just turned into
$17,800 just by signing the papers and leaving the dealership. After one year,
your car has depreciated 25% and is worth $15,000. After five years, your
vehicle will have decreased in value by a whopping 63%. Your $20,000 investment
is worth $8,000. There is no other investment that has worse returns. Any
financial expert will tell you a new vehicle is the worst investment you can make.
When you buy a used car, someone else took that depreciation hit and left your
money in your pocket.
It's Used… How can being used be an advantage?
Used cars are road tested. All of their parts and functions have been used and
found to be in working condition, or else it wouldn’t still be on the road. While
new cars are protected by manufacturers warranties and legislation like “Lemon
Laws,” purchasing used will all but guarantee that you aren’t purchasing a
vehicle with significant manufacturing complications.
Automotive Textile Fortification and
Decontamination… or Air Freshener… With used cars, there’s no ridiculous add-ons. With new cars, you've agreed
on a price and when you go to seal the deal and finally look at the invoice you see
things like “Enamel Corrosion and Oxidation Impediment” for $800.00. What’s
that? Rustproofing. Wouldn’t a new car already have been protected from rust?
Of course it was.
Insurance Costs… Used cars cost less and so they cost
less to insure. They are also less likely to be stolen helping to lower the
cost to insure.
Better Options… When you buy used, the money saved can
be used to upgrade your model. While the options aren’t custom like in a new
car, you can afford to get more of them.
The choice of buying a new or used car is decided entirely upon what a
“value” is to you. Is it all about the cost? Or are you willing to pay more for
the presumed life status a new car implies? Whichever you choose, considering
all of your options and taking a little more time to weigh the costs and
benefits will leave you more satisfied with your decision in the end.
Content By:The Used Car Store
1803 Brighton Place
Pittsburgh, PA 15212