How to Decide Between New or Used
When you’re looking to buy a car, whether you choose a new car or something pre-owned is one of the biggest decisions you’ll make. Both new and used cars have their pros and cons, so make sure you pick what works best for you and your budget.
Pros and Cons of New Cars
When you buy a new car, you get instant security. You know that car hasn’t traveled more than a few miles for test drives, it hasn’t been in a crash, and it has all new parts and tires. New cars also tend to come with factory warranties, which can save you money if one of the parts fails.
On the downside, new cars are significantly more expensive than used cars, with higher payments and higher insurance rates. Plus, new cars depreciate fast, so within a couple of years of owning it, its worth will drop by as much as 50%.
Pros and Cons of Used Cars
Obviously used cars don’t offer the same peace of mind as new cars, and their higher mileage, older parts, and potential history of crashes can mean that you pay more in repairs. If you’re going to buy used, always get a copy of the CARFAX Report to make sure it hasn’t been in any major crashes.
Used cars are great for saving money, though, thanks to lower payments and insurance rates, and you don’t have to deal with that big depreciation period.
Buying used also gives you more options—if you have a budget of, say, $20,000, your choice of new cars will be limited, but you could find a large SUV or even a luxury car at the price if you’re willing to get one that’s a few years old.