When buying a car, the first choice that must be made is between new and used. The merits and demerits of the two types of purchases are different, and the decision of which to opt for depends on personal preferences, budget, and the nature of transportation needed. Analyzing the differences between new and used can help arrive at a conclusion on which to buy, depending on your lifestyle and financial needs.
There are many benefits of buying new cars, the most significant of which is the new technology and newer safety features. Newer vehicles have some special and advanced driver-assistance system (ADAS) that can make you safer when you drive, such as lane departure warning, adaptive cruise control and automatic emergency braking.
Secondly, newer cars are now much more fuel-efficient as the technology in cars has been improved recently. Moreover, because newer cars emit fewer greenhouse gas emissions, they are good for the environment.
Another major advantage of a new car is the manufacturer’s warranty, as many manufacturers provide the warranty for the first three or five years, which means that the repairing and maintenance for a car is now much more affordable.
However, the biggest disadvantage to buying a new car is depreciation. New cars depreciate a lot when they are driven off the dealership lot. On average, a new car will depreciate by about 20% in the first year, and then go down from there. Since that happens so quickly, if you decide to sell or trade in a car after just a few years, you will end up getting back way less than what you paid for the car. New cars also have a higher price, which can mean more expenses in loan payments or out of pocket costs.
One the other hand, used cars are cheaper than new cars and this is main benefit of used cars. When you buy a used car you do not have to pay very high price for a new car. From the very first month of used new car you will get rid of very huge depreciation of a new car.
In many cases, you can buy a high quality, nearly new used car that could have many of the same features as a new car for a fraction of the new-car price. This also means lower payments each month, lower insurance premiums and registration fees and so on.
Loss of warranty coverage could be a potential downside of purchasing a used car. Although many used cars still come with relatively low mileage and are in good condition, some may be sold without the manufacturer’s warranty, and you would be responsible for paying for any repairs if something goes wrong. Certified pre-owned (CPO) cars offer a solution between new and used vehicle purchases. These cars have been inspected and repaired thoroughly by the manufacturer, and usually are sold with a warranty extension, providing the buyer with the added security without having to pay the price of a new car.
Should you buy new or used? That depends on how much you can afford to spend, your driving needs, and how long you plan on keeping latest electronic features, safety enhancements and warranty coverage are important to you, a new car may be your best bet. But if you need to save money and don’t mind having a car that’s already faced all the harmful impacts of depreciation, a pre-owned vehicle might be right for you.
