New cars are a tempting option to consider when replacing your old vehicle or planning to add to your toys in the garage. New cars are often easier to finance and usually come with the latest tech and safety features. However, whatever way you tend to look at it, purchasing a new automobile is generally not a sound financial decision.
Whether you’re into used cars or new ones, each category possesses their individual benefits and shortcomings. To help you understand, we have made a list of ten reasons why you should consider buying used cars instead of looking up car ads for new cars.
1.) New Cars Depreciate
Cars depreciate. This comes with a small number of outstanding exclusions. “There’s no such thing as free dinner” dad used to say. Quite frankly, this is the case with vehicles too. Irrespective of the perks – free maintenance, warranties, low funding – that comes with new cars, the unavoidable law of depreciation remains a looming expense and a good reason to hunt for used cars instead.
The moment you ride your new car off the sellers’ lot, the value drops. Substantially. Some car brands hold value better than others do, and some brand-new cars often last longer than ever before, yet still, up to 40% of its value is still lost within their first year of purchase.
Considering the probability that money may have been borrowed by the buyer to pay for the new car, and 40% is already going out the window while loan payments are still made on the car, makes buying a new car a questionable investment. Obviously, this will vary depending on your wants and financial situation.
2.) Worry Less About Minor Damages
Buying a used car lets you worry less about scratches and damages that are not major. There’s lots of excitement when driving a brand new car, but it’s mentally stressful when you have to worry about the little dents and dings that may occur at any time. Each parking lot, expressway, or other places makes drivers fret. Driving a used car doesn’t make you fret but rather you count them in your collections of driving of experience.
According to Brian Corsetti, little damages are not good for any vehicle but you’d experience a bigger heart race if you scratched a new vehicle.
3.) Same Money – More Car
Do you know where the real fun is? Shopping for used cars instead of making budgets for new ones. Unlike with new car depreciation, your hard-earned money can take you into the advanced market section of when looking at used cars. Your budget may be able to get you an entry-level car only when going for new vehicles, but in the land of used cars, it can get you into a higher-end model, with better features and a better fit for you.
For instance, a BMW or Mercedes brand new is likely off the table for you. Same with that loaded SUV. But when you look to used, even a one-year-old model may be quite affordable for the same body type. This is how some car owners are able to obtain the car of their dreams. And to most onlookers, they’re none the wiser.
4.) Certified Pre-owned Option – a Means of Getting Peace of Mind
A warranty gives shoppers some level of confidence in purchasing a product and this is why some people prefer new cars to used cars. However, that is not always the case today because car dealerships now have a program called CPO (Certified Pre-owned) program.
CPO has made the purchase of used car less bothersome.
CPO programs are dependent on manufacturers. And you should note that there is a difference between being dealership certified and manufacturer certified.
Manufacturer certification offers more in context and bonuses than dealership certification, with the former even offering some perks such as car warranties, roadside assistance amongst others.
In addition, some used car only lots, such as DriveNation, also carry their own warranty that often matches up with that offered from a new car dealership. DriveNation’s, in particular, is 90 days/3,000 kms, however, this may even be extended if the vehicle you purchase is still under the manufacturer’s warranty the original owner had purchased it under.
5.) Ah, Data! Used Cars Have it and New Cars Do Not
We are bold to say it. Data helps you make a decision on the reliability and value of a car. Take that previous experience and you can extrapolate to get an idea on how the future performance of this vehicle might look like as well.
6.) Pay Less for Insurance – Used Cars Let You Do That
Your insurance company looks at the value of your car before deciding the rates you pay. It is more understandable to say that a used BMW incurs lower insurance costs than a new one – all thanks to that dreaded depreciation we have been talking about from the onset. If a new car gets wrecked, your insurance firm will have a bundle of costs at their feet and they charge you higher for car insurance because of it. However, if your used car gets wrecked, of course, you’ll still be upset, but they’ll have to spend less to repair it, therefore you also tend to pay a lesser insurance fee.
7.) Registration Fees are Cut Down
Some provinces base their rate of registration on the age of the vehicle. This implies they charge lesser rates for registration if the car is older. You can enjoy this benefit if you reside in one of these areas. Remember, it’s not applicable everywhere.
8.) What Lasts Longer? It’s a Toss Up
Many of those who poo-poo buying used cars are often satisfied with the CPO warranty option made available by car dealers today. However, employ the services of a mechanic to inspect your prospective car before purchasing it. They will help you assess the reliability and lifespan of the car you‘re about to purchase. This is something that really doesn’t get the option to do when buying a new car and is a big reason we hear the term, lemon. Sometimes you don’t know what you have until the kinks have a chance to show themselves.
9.) Vehicle History Reports
Used cars last longer than they used to. That statement may not sweep you off your feet, but the handiness of vehicle history reports might just do it. Services like CARFAX and AutoCheck have helped auto shoppers gain a higher layer of peace of mind when seeking to purchase a used car. Bear in mind that seeing a good report regarding a car does not mean you should not ignore getting a mechanic to do more assessing for you. However, getting to see the number of owners, accident and repair history sure does give you a good indication of future performance.
10.) A Thriving Online Community of Real People
There is tons of relevant info online and offline for owners of used vehicles. There are lots of forums and platforms where car owners can ask questions and get answers from experienced people around the world for FREE! With a new car, you’re a bit at the mercy of reviews from driving experts. Who do you want to take your recommendations from? The guy paid by the manufacturers or your neighbor down the street with a youtube account? We’ll take real people for $200 Alex!
We love top 10 lists, and I’m sure we could make another 20 reasons why we’d suggest for you to buy a used vehicle, but the decision is up to you and your current financial situation. Regardless of what you choose, make sure you’ve done your research so you drive away…happy.