If you’re thinking of saving money, but you’re desperate for a new vehicle, then buying a used car might be a great way to save some big bucks.
It’s not just about saving money though – there are many other benefits of choosing a used model over a new car.
- Avoid depreciation
As soon as you leave the dealership, your new purchase will lose around 20 percent of its original value. That’s not the end of it though – you’ll find another 10 percent wiped away over the course of 12 months, resulting in a total loss of 30 percent. Say you originally bought a car for $40,000 – in real terms, you’ll see a $12,000 loss of investment in the first year alone.
Depreciation certainly is a killer. The best way to avoid this is by purchasing one of the many used cars on the market that are around a year old. Depreciation flattens out after this period, where the next big hit happens after five years of ownership. One of the most cost-effective ways of operating a car is by purchasing a two-year-old used car and driving it until it no longer runs.
- You can pick up premium models for much less
The one thing that we all love is that new car smell. Driving off the lot in a glistening new model, admittedly, it’s a great feeling. But that soon goes. The new car smell will disappear after a month; the new shine will disappear after a few months – essentially you’re paying for six months of ‘newness’.
If you’re happy to accept that cars get dirty and new smells disappear, then used cars are perfect for you. As mentioned previously, you can shave $12,000 off one of the premium models released today if you wait a year. As you can appreciate, that’s a huge amount of money. Wait five years, and you could take a $40,000 car for less than $20,000. Exercise a little patience, and the savings could be huge.
- It’s great for the environment
Think about all the old cars that get trashed every year? It makes total sense to buy a previously owned vehicle with good fuel economy, as opposed to purchasing a new one outright – especially as scrapping cars has a severe impact on the environment. For example, did you know that around 12 to 28 percent of all carbon dioxide emissions released throughout the life-cycle of a car occurs from the transportation of the new vehicle? That’s a startling statistic and one that can be reduced by purchasing used cars.
- Cars are getting more reliable every year
While an older model from the 80s won’t run like a dream anymore, you’ll find solace in the fact that models from the early 2000s will still run extremely well, even after a decade of use. Don’t feel that you’ll automatically get a run-down vehicle because it’s used – as technology advances, as does the life-cycle of a car.