New vs. Used Car: Making the Best Decision
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Buying a car is a privilege many of us will face in our lifetime. If you’re torn between buying a new car vs. a used one, here are some advantages and disadvantages to help you make the decision that is best for your needs.
Who is the vehicle for?
This is a good question to start with. It’s very different if you’re buying a car for an experienced driver as opposed to a teenager. It’s important to consider how much mileage you intend to put in, if it’s the only vehicle you and your family will have for a while, or other considerations. A new car will obviously last longer.
Pros and Cons
- Cost: Buying a used car will most likely adjust to smaller budgets. When you buy a new car, it’s harder to negotiate the price at the dealership. When you’re buying a used car, there’s more room to offer less money, especially if the owner has a sense of urgency.
- Previous owner: When you buy a new car, you don’t have to worry about previous ownership, wonder how the car was driven, or think about the paperwork when transferring the title.
- Warranty and repairs: A used car can mean more expenses in maintenance and repairs. And it is more unlikely that a used car is still covered by the original warranty. When acquiring a new car, you’re also buying peace of mind since it comes with a 3-5 year warranty from the dealership. If anything happens or if there’s a recall, you can rest assured the dealership will take full or part of the responsibility.
- Depreciation: A car loses about 45% of its value after the first 3 years. This number may vary depending on the model and make of the vehicle.
- Safety: Older cars may not come with some of the enhanced safety features we see in newer cars, such as Electronic Stability Control, child seat retainers, front and lateral airbags, anti-lock brakes, or traction control, to mention a few.
- Auto insurance: It is more expensive to cover a new car than a used one. This is important to keep in mind since it adds to your month-to-month expenses.
- Environment: If you’re concerned about the environment, be aware that a new car releases less toxic gases than a used one.
If you are thinking about buying a new car, we suggest you compare makes and models and go for a test drive before taking the plunge. If you’re going to take the used car route, don’t forget to search for the True Market Value of the vehicle and ask for a report based on the car’s VIN, available for purchase at AutoCheck or Carfax.