Trying to decide whether to buy a used car or a new one is a process that many car shoppers go through. While both options have their advantages and disadvantages, there has always been one major upside for buying used over brand new, which is the fact that it is the better solution for consumers whose ultimate goal is saving money.
Given that buying a car is one of the most expensive purchases a person can make, the desire to save some money in the process is understandable. However, there are many more benefits to buying a used car than simply saving a few bucks. The decision to buy a used car offers advantages that have to do with the way you finance your car, reliability, as well as the range and price of options you might like to add to your car.
Getting a Loan for a Used Car Is Easy
Simply put, financing a used car is easier compared to financing a new one. Used cars are inherently cheaper than brand new ones, so they can be financed with a much smaller loan.
On top of that, financing a car is traditionally the simpler and quicker option compared to trying to get a car loan from a bank or a credit union. With this in mind, it is safe to say that financing a used car is far more convenient and more practical than financing a new one.
Installing Extras and Upgrades on a Used Car Is Cheaper
Customizing a new car can be costly. If you decide to buy a new vehicle, the seller will offer you a slew of very expensive options while trying to convince you that each of them is absolutely necessary and worth paying for, but all they actually do is raise the car’s purchase price substantially and increase the dealership’s profit margin.
However, if you opt for a used car, you will be able to customize it the way you want and spend much less money than you would spend to customize a brand new car. It’s far less expensive to buy aftermarket features and have them installed on a used car, opposed to purchasing the same features at a new car dealership.
Lower Depreciation Rates
One of the biggest downsides of buying a new car is that it loses a huge portion of its value as soon as you purchase it. Statistics show that a new car depreciates by up to 20% the minute it leaves the dealership’s lot, and continues to lose its value over the next few years. This is where a used car holds a huge advantage over a new one, given that by the time a pre-owned car is sold, it has already lost a significant part of its value and you won’t have to worry about it depreciating much more. This makes buying a used car a good investment that will have more or less the same value it had when you bought it for years to come.
Reduced Insurance Costs and Registration Fees
On top of the lower sticker price, there are a few more financial benefits that come with buying a used car. Statistics show that the average annual insurance rates  nationwide are over $900, which makes insurance one of the biggest expenses associated with car ownership. Used cars cost much less to insure than new cars because of their lower total value. You can save hundreds of dollars per year on insurance by opting for a used car.
What’s more, registration fees are also lower for used cars. The factor behind this is the same that helps reduce insurance costs; a used car has lower value compared to a brand new one.
Lastly, there is one more aspect that is often overlooked: opting for a used car is a perfect solution for those who like luxury cars, but can’t afford to buy new. Maybe you don’t have enough money or don’t want to spend a fortune to purchase a new luxury car, but if you are willing to settle for a used one, you will be able to get a premium model for a more acceptable price.
With all of the above in mind, buying a used car presents a wise investment in more ways than one, but it will only pay off if you conduct thorough research before committing yourself to the purchase.