Is buying a new car right for your budget? Out of all the vehicles that are being offered by many dealers, is it really worth spending your money on a brand-new car?
If your budget is limited, getting a more affordable car buying option such as looking at second-hand vehicles may be the best for you.
Any vehicle depreciates over time and there’s no stopping it—even instantly after you drive it off the lot. A new car loses up to 20 percent of its value each year. It’s crazy to hear how much value it loses.
In the car’s second year, it will be worth 80 to 85 percent of its first-year value. Any vehicle continues to depreciate as weeks, months, and years pass. Many car buyers complain about how quickly their new car depreciates, so if you drive home your $20,000-worth vehicle, it will instantly downgrade at around $17 grand.
For instance, you agreed to pay a certain amount of money for the car to the dealer, then you drive it off the dealer’s lot. Even if you have only driven it for a few minutes and suddenly changed your mind, you are now looking at a car that is only worth the wholesale value.
The wholesale value is always less than the original retail value of the vehicle you purchased. The value of the new car immediately depreciates the minute you sign the paperwork and drive it off. For a brand-new car, the initial depreciation can be in the thousands of dollars. This is why second-hand cars are more affordable than brand new ones.
Are second-hand cars bang for the buck?
It is not unusual for some vehicles to be trouble-free if it’s over 100,000 miles. Check under the car to see if there’s any fluid leaking and inspect other parts if it needs any repair. You need to assess the car’s condition before agreeing to buy it.
How well the car is maintained, its year model, as well as mileage can affect the depreciated value. A few cars retain a higher value but only if they are a sought-after model or considered a “collectible car”.
Buying affordable used cars is like going on a treasure hunt because you have to look for the best deal possible. If you have found a nice car without any problem and got a good deal for it, then you can consider it a “bang for your buck.”
What you can afford
While there are many luxury cars available for those who can afford them, setting up a budget is a good way to know what second-hand vehicles you can pay for. If you don’t have a specific car in mind, you can use your budget as a factor to look for a list of affordable used cars.
Try to compare the asking price of the seller to the average market price to get a pricing guide. You can also negotiate the best price if you found a used car that you’re interested to purchase. When you bargain with a salesperson at a car dealership, you are dealing with a pro who knows all the tricks. Don’t forget to ask about fees before saying yes to a deal. You can even ask for a breakdown of additional fees before you agree to any deal.
Spending all your savings to buy a used car isn’t a good idea. If you’re planning to buy a car that is out of warranty, it’s better to set aside a fund to cover any unexpected repairs. Even if you buy a used car at a good price, you will still need to set aside some money from time to time for maintenance, registration, wheels and tires, fuel, insurance, etc.
Choosing a car that’s right for you
The U.S. used car market has a large selection and the prices vary widely. The fun begins in picking a car to purchase.
After taking your budget into account, it is important to think about some criteria you would like to see on the car you’ll be purchasing. Also, think of how you want to use the vehicle. Will it be a family car? Then it should have enough room for everyone and ample cargo space. Will it be used for daily driving to and from work? Then, it should be a reliable car.
Narrow down the list of second-hand vehicles based on your criteria. Take note of the features you’d like to see in a car, then search for models with those qualities. Research is an essential part of building a list of target car models. It will greatly help in choosing a car that’s right for you.
It is important to run a vehicle history report by checking the vehicle identification number (VIN). If you’re keen to check a second-hand vehicle from a dealer or private seller, it’s better to test drive it first before closing a deal.
Certified used cars
With so many choices, finding the right car for you can be a challenge. Thanks to the help of the internet as a car shopping tool, you have every chance of finding a good list of the most reliable used cars that fit your budget and meet your criteria.
You have a lot to look for when choosing a used vehicle. Car buyers need to make smart choices when looking for used cars because there’s a big chance that second-hand vehicles have undisclosed problems. If you’re searching for a quality vehicle without the higher price tag, you can opt for certified used cars.
Certified Pre-Owned (CPO) vehicles are certified by the manufacturer or other certifying authority. They are also inspected and refurbished to assure their quality. If second-hand vehicles are certified, it guarantees the buyers they’re getting quality and thoroughly inspected cars that’s also a bargain.
Non-CPO vehicles have no warranty and are often sold “as is”. They have manufacturer-backed warranty coverage but with an affordable price tag than brand new cars. They have service records but no history of any accident, plus they’re usually low-mileage and just a few years old. This type of second-hand vehicle may be returned at the end of the lease, dealership service loaner vehicles, or those used by the dealer or automaker staff.
Certified used cars often have an extended warranty, special financing, and additional benefits from the dealer. Brand-new vehicles simply hold the assurance that they are new and fresh from the manufacturer. CPO vehicles undergo a comprehensive inspection with strict guidelines from the original manufacturer, as well as a undergo refurbishment process. You will get some incentives when buying this type of used cars instead of brand-new ones. You can save money on car insurance, taxes, registration, and even depreciation.
Worry-free mod-ready car
Most owners of brand-new cars tend to wait for the warranty to elapse before they can mod their ride. If you’re one of the people who are looking to buy their next project car, then purchasing a used car is a nice option.
A second-hand car has “no strings attached” to the dealer. You are free to modify that if it has passed the warranty period. No worries about voiding the warranty when you install car parts by yourself.
When buying a used car, you don’t need to settle for expensive dealership add-ons. You can install the car parts at a lower cost by buying car parts like spoilers, tires, and other car and truck accessories from stores such as 4WheelOnline.
Preloved cars that you will love
Second-hand cars are obviously the cheaper alternative to new cars. Just because a car is not brand-new, doesn’t mean it isn’t worth the money. Buying a used car has its perks, especially if you’re on a tight budget. Now, go find a second-hand car that’s still road-worthy!