When it comes to buying a car, there are so many things you have to consider and just to start thinking about it gets overwhelming. So let’s start from the beginning. Should you buy a used our new car. Before I tell you my opinion, I will compare both options on Safety and Cost.
We can all agree that buy a new car is more reliable than buying a used one. If a new car breaks down, you can have it fixed for free under the included factory warranty, at least for the first 36,000 miles or three years that most carmakers offer. They have more advanced technology which makes them safer and more comfortable to drive. But like most things in life, there are manufacturer mistakes, and we have seen cars being recalled because of manufacture problems.
Lots of people are resilient to buy used cars because they’re worried about inheriting someone else’s problems. This is why it’s important to check the car history. You can check it online just with the car’s VIN number by going to Carfax or Carproof websites.
You should also do your research and make sure that the model you choose has good reviews and is reliable. The quality of the car can vary from make to make. And even if you buy a new car, you can be buying a piece of metal that will put you and your family in danger.
Buying a used car is much cheaper than a brand new one because of the depreciation hit. Cars lose value each month, but the hardest hit happens right away. The Canadian Black Book shows that, depending on the model, a new vehicle loses between 20% to 25% of its value the moment the car leaves the dealership. Some models drop by as much as 40%. This is where you can save the most money by buying used.
So, if you buy a $30,000 car as soon as you drive it off the dealership lot, its value might drop to $22,500 or more what!!??
Also, because buying a used car is cheaper the insurance will also be cheaper! And if you buy used, you can buy a higher class of car for the same price you could spend on a new one.
If you don’t have the cash to buy a car, there are financing options that cheaper for new cars, usually, dealers give you interest incentives to buy their shiny brand new cars. But let’s be honest here if you don’t have the money to pay for it, it means that you can not afford it!! If you have to make payments for 5, 7 years or so, you shouldn’t buy that car it doesn’t matter if its new or used. Just suck it up and buy a cheaper option. And remember a new car depreciates its value as soon as you drive it out of the dealer’s lot, so even if the interest rate looks appealing, you are losing money one way or another plus you are locked in for many years of payments, and we all know how unexpected life can sometimes be.
After this comparison, I can tell you my opinion… If you have the money to pay for it, buy a used car that almost new, that doesn’t have too much millage, a reliable model and make and with no history of big accidents. Remember that the purpose of a vehicle is to get you from point A to point B, not to prove a social status.
In the next blog, I will show you how to buy a used car. Keep crashing your money goals, and we will see you next time!
Subscribe to our weekly emails about money, parenting, relationship and more.
Don't worry, your information will not be shared.
Overspending can easily get out of control and if we do nothing to control it, it can ruin families and love relationships. Take this FREE COURSE and discover the power within you.