Should You Invest in a New or a Used Car?

Should You Invest in a New or a Used Car?

With the advent of latest technologies in the automobile industry, car buyers have multiple options to explore when making their car purchase. But, the toughest decision to make is the choice between a pre-owned car or a brand-new model. Both sound lucrative and have their individual perks. However, you should decide based on your specific requirements and buying criteria. The dilemma of choosing the right one is always there. That’s why you need to evaluate the pros and cons of both these options for making a better selection.

Pros of Investing in a New Vehicle

It is always tempting to drive off in a vehicle coming straight from the factory. This vehicle is integrated with the latest technological features and stunning looks. Additionally, there are perks like the comprehensive manufacturer’s warranty that covers the maintenance of the vehicle over the first few years. This reduces the cost of ownership substantially and ensures peace of mind for the buyer. Many dealers also provide additional benefits to new car buyers.

A brand-new vehicle offers superior fuel efficiency and the best safety features to enrich your driving experiences. Banks and lending institutions provide many attractive loan options at competitively low interest rates with the purchase of a new vehicle. Plus, you can customize your new car with additional bonus features and latest gadgets that are hard to find in an older version.

Cons of Investing in a New Car

Despite all the benefits offered by a new car, a loss in its valuation is inevitable due to the cost of depreciation incurred on it. As soon as you drive home a new car, it loses nearly 15% of its value immediately due to this factor. Therefore, you usually end up losing 20-30% of the valuation on completion of the first year itself.

Beside the factor of depreciation, you need to consider the costs of sales tax, registration and other expenses when buying a new car. Choosing to add accessories is also a huge expenditure with brand-new models. Remember, many essential accessories are charged additionally by the dealer.

Pros of Investing in a Used Car

A used car is definitely a viable option if you consider depreciation and look to save a huge sum of money on your car purchase. Buyers can end up benefiting by paying 20-30% lesser cost on a like-new used car which is only one year old. This is because of depreciation, which is beneficial for them. Also, there are no significant expenses with a used car if you purchase it after a thorough inspection. In fact, you will find many additional accessories and other modifications intact with a used car. If you are lucky, then you can also get expensive modifications and accessories at a throw-away price with your used car. Moreover, you can get the advantage of buying a bigger car within the same budget in which you are purchasing a new car.

Cons with a Used Car

Uncertainty about performance and transparency in dealings are the biggest concerns for used car buyers. You are unaware of its past history and how the vehicle was driven. But, these can be overruled if you opt to buy your used car from authentic dealers who process every pre-owned car under strict inspections before selling it.

Consider these factors beforehand and make a wise decision when buying a vehicle that suits you.