In these hard times where money is not as easy to earn, it is important to get into the habit of spending it wisely. Proper money management coupled with appropriate information gives you more bang for your buck.
The same thing could be applied to buying a car. Between getting a brand new one and a used car, you have to consider all the pros and cons before going to a car dealership or a used car lot in Tulsa or Raleigh.
Here are five reasons why getting a second-hand car is better than going for a brand new car:
5 Reasons Why Buying a Second-Hand Car is Better Than Getting a Brand New One
It saves you a lot more money.
Other than the fact that a brand new car costs a lot more than a pre-owned vehicle, you have to factor in sales taxes and other fees.
CNW Marketing Research released some figures before that the average cost of a car in 2008 was $25,536, excluding taxes and fees. That’s almost, if not more than, double the price of a used car that has already depreciated over time. Insurance premiums and annual registration fees are also a lot lower when you buy a pre-owned car.
Depreciation has already taken place at the time of purchase.
Speaking of car depreciation, the old adage that says a brand new car already loses thousands of dollars once you drive it off the lot is still very true today. A car’s value immediately drops 11% just on the drive home from your dealer. This means that your $20,000 brand new car is already only worth $17,800 once you park it home for the very first time.
Would you rather be the guy who pays top dollar and loses money they can’t recover or the guy who saves that much money?
No crazy, outrageous dealer fees.
Since you are no longer getting the car from licensed dealers and showrooms, you get to avoid the unnecessary (and mostly unwanted) add-ons and upgrades, outrageous “dealer preparation” fees.
Customization costs are low.
You know how dealers usually insist that you get the additional pinstripe or anti-rust coating and protective film at a minimum extra charge? You can get all of these add-ons from after-market sellers and installers at a fraction of the price. This way, the money that you saved can be spent on upgrading the pre-owned car that you bought.
A lot of used cars for sale still have their original warranties. If you get a car that has an extended manufacturer warranty, then you did well. This means you can have your car serviced by a factory-trained technician for parts replacements or repairs.
However, not all used cars have existing warranties. You have the option of creating a new warranty in case you face this situation. You can even use part of the money you saved in getting a warranty that can cover more than 100,000 miles.
When it comes to practicality, going with a pre-owned car has the edge compared to buying a brand new one. However, you have to do your due diligence and find out as much information as you can about the cars you are considering including ownership history and roadworthiness.