In this economy, every dollar counts. Most consumers are looking for ways to cut their expenses wherever possible. Fortunately, you don’t need an online finance degree to figure out how to save a great deal of money when buying a car. The trick is to buy a used vehicle. While it may seem exciting to be the first person to own a specific vehicle, most people will agree that getting a significantly better deal is far more exciting. However, this is not the only reason to buy used, there are a number of others that are just as compelling.
1. That shiny new car will have depreciated by the time you get it home
According to Edmunds, new cars lose approximately nine percent of their value as soon as they are driven off the lot. After one year of ownership, that same car will have lost 19 percent of its value and 60 percent by five years. This is great news for used car buyers, since they will be able to take advantage of the lower prices and won’t have to worry about their car depreciating on the drive home.
2. Those zero percent financing offers are not going to save you money
The promise of a zero percent interest rate on an auto loan is always tempting. Even if you have great credit, you won’t receive the same deal on a used vehicle. However, even if you have to pay interest on your used car, it is likely to be much cheaper than buying a new car. As long as you obtain a loan with a decent interest rate, you will still be able to save a ton of money by buying used.
3. Sick of high insurance premiums?
Purchasing a used car will cut your rates. New cars are worth more and are therefore more expensive to repair or replace. This represents a greater risk to insurance companies, who will charge you a much higher premium as a result. Choosing to drive a car that is a few years old will noticeably cut your rates.
4. New cars are not always better for the environment
As long as a used car is properly maintained, it will usually be no worse for the environment than a new car of the same make and model. Purchasing used also helps to keep cars out of the junkyards. The longer a car is on the road, the more justified the environmental impact of building it will have been. If no one purchased used, these cars would be sold for parts and left to sit in junkyards.
Also, according to an article on About.com, written by Edward Peabody of “E/The Environmental Magazine,” electric and hybrid cars are not always better for the environment. Because of the environmental cost of the batteries, manufacturing hybrid vehicles is actually worse for the environment than other vehicles as they generally have two or more large batteries. By buying used, rather than new, consumers are lengthening the hybrid vehicles’ life and lessening the negative impact on the environment.
5. Afraid that a used car will not be covered under warranty? Think again.
All new cars come with a warranty. This warranty will usually protect a car until it is 10 years old or has been driven 100,000 miles. It is important for drivers to understand that this warranty does not just cover the original owner, but it is valid until the car has exceeded the terms of the warranty, regardless of how many people have owned the car.
There are many benefits of driving a new car. Drivers get to enjoy the new car smell, while having the pleasure of knowing that they were the first person to call the vehicle their own. However, being first is not always better. Used cars are less expensive to purchase, more affordable to insure and help drivers live a greener lifestyle. Due to these many advantages, it may be wise to pass up the rows of gleaming new cars in the front of your local dealership and search the pre-owned section instead.