Buying a new car vs. used car - A brief comparison

Buying a car is a big decision because it will affect your finances for the next few years. After you decide to buy a car, now is the time to decide what car to buy and whether it should be new or used. Both new and used cars come with their pros and cons. In today’s blog, we will be doing a brief comparison of the pros and cons of buying a new car vs. a used car.

Advantages of Buying a New Car

The first thing you will enjoy about a new car is the smell of a new car. As a general rule of thumb, a new car comes with a warranty from the manufacturer. Apart from that new cars don’t need frequent repairing so in the start you will have to just do the regular maintenance. In most cases, the dealer will offer car financing at very low-interest rates so you can save some money while paying the loan. If we look at other perks, new cars come with the latest technology installed and their performance is optimized, so you can have some good mileage. If you go for a hybrid car then you can save a decent amount of money monthly. You can use that money in paying the installments.

Disadvantages of buying a new car

The biggest problem with buying a new car is depreciation. You lose money as soon as you put your car on the road. A new devalues the most in the first couple of years, which means you lose money that you are never going to get back. If we talk financially, there is no sense buying a new unless and until you have can afford losing money. Another big disadvantage of buying a brand new car is that the next they change the engine or make other big changes and your car model have some major manufacturer issues. In buying a used car you avoid that risk.

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Advantages of Buying Used car

The biggest advantage of buying a used car is that you avoid taking the risk of depreciation. Somebody else took that hit for you. You can sell your car for almost the same price in the next couple of years. Buying a new one gives you the benefit of finding a better car financing option through your local bank or credit union. When you buy a used car, you can save up and pay cash. Another advantage is that you may get a lower insurance rate for a used car as compared to a new car.

Disadvantages of buying a used car

The first disadvantage of a used car is that you might have to do more repairs as compared to a new car. That can be overcome by buying a certified pre-owned used car. Different platforms are available to find such a car for you.  Another disadvantage of buying used is that you may have to compromise on the color of the car to get the one with the better history and mileage. When shopping for a used car, you need to be more flexible and more patient as you hunt for a car. You can also expand your search and look for the best price on available cars.

Conclusion

Everybody knows their finances and it depends on your finances which car option is the best for you. As a general rule of thumb, you should pay your installments in three to four years. If you cannot afford the payment at this rate then perhaps you cannot afford a car yet. Always do your research about the make and model you choose. In used cars make sure all the major parts are in good condition other you will be looking buy car wheels and Rims in the near future.   Ask people and read reviews to have good knowledge about that specific car. If you are not into this much detail then you should consult a professional about this. 

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