Have you been thinking about buying a new or pre-owned car lately? Have you been considering a change in vehicles for a while but can’t decide if you want to spring for a new car or look for a pre-owned car that might prove easier on your wallet? There are pros and cons to both. Here are a few things to think about when you’re trying to decide between a new versus a used car.
With a new car, you can get exactly what you want--the color, the trim, the features. Your new car will come with a manufacturer’s warranty. Many used cars, especially those sold by individuals, are sold “as is.” If you’re the first owner of a vehicle, apparently you will get more life out of it than out of a used car. Do you tend to keep your cars for a long time and drive them to very high mileage? In that case, buying a new car will likely give you more years of ownership.
What is the main drawback to buying a new car, then? Well, there are three: 1. Depreciation. 2. Depreciation. 3. Depreciation. Just driving a new car off the lot can drop its value by 20%. By the end of your first year of ownership, your “new” car’s value might have depreciated by as much as 30%. Of course, your insurance rates will likely still reflect what you paid for the vehicle, as will your car registration fees.
Are new cars more reliable? Well, maybe. This is dependent on the car make. Do they require less maintenance? Not really, since all vehicles require scheduled maintenance to keep running well. However, a lot of newer cars require maintenance less frequently, so you could argue that buying a new car means fewer trips to the mechanic, at least initially. And it is more likely that a used car will start showing age-related issues sooner because of its, well, age. But if your monthly car payment for a new car is high enough, you might not begrudge the repair costs of a used car, especially if it’s paid off. And the insurance and registration rates for a used car will be lower, too.
There are more financing options when you buy a new car. Dealers and manufacturers offer incentives like low-interest loans and rebates. If you negotiate well, you can get a great deal. Newer cars have more safety, comfort, and performance features. And, if a new car breaks down, most warranties will fix it for free under the manufacturer’s 36,000-mile warranty.
Remember what we said about new cars and depreciation? There are exceptions. Some car brands hold their values for much longer. If your idea of a “used” car is only one or two years old, you might get a better deal by buying a new model if you factor in the possible availability of incentives and low-interest financing.
In the end, how do you decide which is better for you--a new car or a used car? Well, you will need to consider a number of the factors discussed above and figure out what is most important to you. If all else fails, consider using an online calculator to crunch the numbers: here’s one from cars.com and another from allstate.com.
Whether you decide to drive a brand-spanking-new car off the lot or instead opt for a pre-owned vehicle, you can make sure it’s always running the way it should be having your car inspected and serviced regularly. We at Nordgren Automotive are serious about keeping you and your family safe on the roads. Give us a call to schedule an appointment or visit us online.