On the lookout for a new vehicle? Maybe your old car has finally passed into the great beyond or maybe you’re just looking for a change. Either way, the biggest question churning in your mind should be: new or used? The answer really comes down to personal preference and financial situation. However, there are positives and negatives to each.
Buying A New Vehicle
Buying new may seem like the best option. There are many benefits to buying a new car instead of a used one. First, you know the car’s history. Since you are the original owner, you don’t need to worry about previous owners, accidents, or questionable modifications. This car will be custom built just for you. It will also have the latest safety systems in place, as well as a warranty.
So, what could be wrong with buying a new vehicle? Outside of increased cost, the biggest issue you will run into is depreciation. According to Edmunds.com, the moment you leave the lot your car becomes “used”, dropping in value by a minimum of 7%. It doesn’t get much better from there.
After the first year, the Total Market Value of your car drops to 81% of its original value. During the first five years, a new car drops in value by 15% to 25% every year. This can make your original investment seem like a mistake. However, if you plan to keep the car for the long term and keep the maintenance up, the life of a new car will definitely stretch to meet your needs.
Buying A Used Vehicle
If you are looking to save some money or your finances are a little tight, a used car may be the best option for you. The amount of money you will save on the purchase will be great, but you will also save on the cost of insurance as well. With this extra money available, you may be able to step up to a newer model than what you were originally searching for. This will give you many more options than buying new.
The biggest drawback to buying used is the cost of maintenance, especially when your vehicle passes the 100,000-mile marker. Also, the lifespan on the car, even when taken care of, is much shorter than that of a new vehicle. Lastly, your car will not have the latest technology and safety features expected from newer vehicles. Yet, if you don’t care about keeping up with the Joneses in terms of technology and you don’t mind spending a few extra dollars on maintenance, the amount of money you will save on your overall investment is well worth buying used instead of new.
No matter what car you decide to purchase, Mercer Savings Bank offers competitive rates and personalized service. We have a fast loan process and easy payment methods. Talk to one of our experienced loan officers today. Call 877.672.4543, contact us online, or visit the auto loan page of our website to learn more.