Should You Buy a New or Used Car? | Effective Tips on Buying A Car
There are many options when it comes to buying a car. Firstly, you have to choose the make and model of your car, and there’s the decision of choosing between a new or used car. Not a lot of car buyers think of this, as most people would just resort to buying a new car, simply because that’s what everybody tells them to do. But can you really afford a new car? Or are you better off with a used one? Your decision may be also based on whether you qualify for a loan or if you will have to pay in cash.
Advantages of a New Car
The main advantage of buying a new car is that what you’re getting comes with a warranty. New cars will have very little repairs in the first few years, allowing you to focus on the maintenance mostly. Your dealer may also offer a loan at a lower interest rate, so payments become easier. These are the basic advantages of buying a new car.
Additionally, new cars have the latest technology that you will no doubt enjoy. This also means that you’ll likely have lower emissions and better gas mileage. If you purchase a hybrid, there’s a chance the amount you spend on transportation each month is reduced. Finally, new cars can sync with your smartphone and other gadgets with ease.
Disadvantages of a New Car
You’ll feel that disadvantage of a new car as soon as you drive it off. In a few years’ time, the value of your car will depreciate, so you’re essentially throwing away money that you can never get back. In a financial aspect, buying a new car is not for people who don’t have a lot of money, unless you have some that you don’t mind losing.
Another disadvantage of a new car is that it could be a brand-new model. Brand new models are notorious for having some issues here and there, so manufacturers often make alterations a year after the initial release.
Tips for Buying a Used Car | Car Buying Tips
Advantages of a Used Car
Used cars are an attractive option for some people for a number of reasons. The biggest advantage is that you won’t have to deal with the depreciation hit since the previous owner has already dealt with it for you. You can even sell your car for nearly the same value as you bought it. There are financing options on used cars too and if you’re lucky, you may come out ahead of a zero-interest loan that you would get for a new car.
Used cars are obviously easier on the budget. When in doubt, you can always read reviews from Consumer Reports on the model you are interested in.
There’s also a chance your insurance rate will become lower on a used car. If you’re an employed twenty-something, this could mean a lot of savings for you.
Disadvantages of a Used Car
The one thing that turns people off from buying a used car is the reliability issue. More often, used cars need more repairs and maintenance. Although, you can always buy certified pre-owned cars, as these cars still come with a warranty and have been thoroughly checked.
However, you still need to set aside some cash in case sudden repairs come up. Always make sure if it’s covered with a warranty.
Another disadvantage is the fact that you won’t be able to choose the color of the car. You’ll have to be very patient with it and accept whatever condition it’s in until you come up with the amount to make the requested changes.
Making the Decision
You’ll have to decide sooner or later. Whatever you end up choosing, whether a used or a new car, make sure you can afford it, its repairs, and its maintenance. Your goal is to completely pay off the car within three years. If you think you cannot make it within three years, then you most likely cannot afford a car.
Make sure that the model you choose is reliable and has good reviews. If you don’t know anything about cars, it’s best to ask a mechanic to look over the car, especially if it’s used.
Shop around for the best loans as well so you can make sure that you can have the best rates.
Questions to Ask Before Buying Your First Car
Here are the questions you need to ask yourself when it comes to buying a car – new or used. If you do not qualify for a loan, your options may be different.
How much do you have to spend on a car?
Truth to be told, there are several financing options that you can avail if you really want a car. While this is certainly good news, it can be dangerous in a sense that you might end up believing you can actually afford a car when in fact, you don’t.
Consider your financial status first and be realistic. If you think you’re struggling to manage your income or if it’s simply not enough, it’s best to avoid very huge purchases even if you’ve been granted a loan. Always know what your priorities are.
What type of car is best for you?
This all depends on your preference and your budget. You can always go for a sedan and that’s essentially enough to take you anywhere you want to go. You can get an SUV if you always have passengers or you’re always hauling stuff. But here’s a tip: you don’t have to buy your dream car on the very first try. It’s ok to take time and save up instead of loaning a car only to regret it later.
A smaller car means more money saved on gas and other costs. Your first car should be reliable and safe, instead of being flashy and all that. Be realistic.
Is it okay to lease a car?
It’s best to avoid leasing a car. That’s just a lot of money wasted. If you plan on buying the car at the end of the lease, that’s more money spent than the original amount of the car.
If you badly need a car, get an old, cheap model that still runs smoothly. It’s okay to settle for less first. After all, it is your first car. Compare how much you’re going to spend if you lease and the total value of the car payments in three years. You’ll soon realize you’re better off with a new or used car than leasing.
Can you get by without a car?
This depends on where you live and what you’re used to doing. People who live in huge cities where public transportation can be such a struggle can definitely make use of a car. If you want to save, invite friends on a carpool. This will help you save energy costs.
If you’re married or share a house with a partner, share your car, so you can save up for your dream car.
At the end of the day, the decision of buying a new or used car will be up to you. What matters is that you can afford to pay it all off. Follow these tips for buying a used car and the tips for buying a new car as well. There are pros and cons to each that you must weigh in to find out if you can afford a new or used car. What will your decision be?
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