You could spend less on a used car, but will it cost you otherwise?
Owning a vehicle is an expensive prospect. Between maintenance, loan repayments and auto insurance, transportation expenses can easily become budget headaches for unwary consumers.
If you need a car, you might consider buying a used one rather than a new one because of the initial savings involved. New-car buyers paid an average of $48,043 in June, Kelley Blue Book reports. Meanwhile, the average cost of a used car was $28,012 in June.
In total, that’s about $20,000 in savings, which is certainly not negligible. But even if you think you’re getting a better deal buying a used car, here’s why you might want to go another route.
1. You can have limited warranty or no warranty
When you buy a new car, you usually get a three-year or 36,000-mile warranty that protects you from the cost of major repairs during that time. You will also usually have the option of extending this warranty for a few more years for a small fee.
When you buy a used car, it may come with a very limited warranty – if it comes with one. This means that if a major component breaks soon after you purchase the vehicle, you could find yourself on the hook for the cost of repairing it.
2. You could lose energy efficiency
Cars have become more and more fuel efficient over the years. If you buy a used car, you may lose in this regard. The result? Much higher gas costs.
Meanwhile, earlier this year gas prices soared following the conflict in Ukraine. And although they have come down a bit over the summer, they are still expensive. Buying a used car could mean spending more money on fuel on an ongoing basis. And so, what you save by buying a used car rather than a new one, you could spend on gas.
3. You can’t customize any features
It’s important not to overdo it when buying a new car, because the more bells and whistles you treat yourself to, the more expensive that vehicle will be – and the higher your auto loan repayments could be. But when you buy a used car, you have no say in how it looks or how it works. And if you’re going to be doing a lot of driving, that’s something you might find annoying.
4. Your car may not last as long
Used cars, by nature, wear more than new ones. So, if you buy a used vehicle, it may not last as long as a new one, which could require you to replace it sooner. And depending on how many years you get out of that car, you could end up losing out financially.
Think carefully before buying a used car
There are definitely benefits to buying a used vehicle, and if you buy a certified one from a reputable dealership, you may not have to worry about hidden issues lurking. But before moving forward with your decision, be sure to weigh the pros and cons carefully. You may decide you’re better off with a new vehicle after all.
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