Why Buying a Secondhand Vehicle Is a Good Financial Move

man handing keys to buyer

A car is an expensive, major purchase. Nonetheless, it is not an investment. Rather, it is an asset and a necessity. To say it is an investment means you expect to receive a return bigger than how much you spent on it. But that is not the case.

In fact, a brand-new car loses its value between 9 to 11 percent the moment it drives off the lot. It is essentially saying when you purchase a $30,000 worth brand-new vehicle, you are throwing away $3,000 the moment you drive it home for the first time.

Over time, specifically, when your new car hits the five-year mark, its value depreciates by 15 to 25 percent. And, after that period, it loses around 60 percent of its value.

Given these facts and figures, it is not too difficult to think that buying a brand-new vehicle is not a great choice. Although it is very tempting to buy a fresh new car, it may not be a good idea, especially if you are limited by your current financial situation.

But even for people who can afford to buy brand-new cars, it may still be an unwise long-term decision. Considering the general depreciation value of vehicles plus the insurance and registration fees and processes you need to factor in as well, most often, secondhand vehicles are a much better option.

So, if you are transitioning from a two-wheel drive to a personally owned vehicle, a growing family looking for a car to accommodate the family’s needs, or simply someone looking for fun lifted trucks for sale, secondhand cars might be the best option for you.

1. Saves You Money

As mentioned, brand-new vehicles immediately lose their value between 9 to 11 percent when it drives off the showroom. Essentially, when you are a secondhand car purchaser, you dodge the initial depreciation hit.

Buying a used car means enjoying all the benefits of a new one with at least a 30 percent discount. Although you still have to factor in mileage, model, and needed repairs, it is still worthwhile to look at the bigger picture.

2. Less Tension and Worries

Regardless if you are an experienced driver or not, riding a brand-new car for the first few times feels like a lot of responsibility. You cannot help feeling tense, making sure you do not give your car its first dent or scratch.

Most often, car owners refrain from taking their brand-new vehicles for a long drive because they want to keep them in pristine condition. In fact, they rather take public transportation than taking chances of denting or scratching their cars.

However, if you opt to purchase a secondhand car, you do not have to suffer the same tension. You know it is already used, so it already has its share of dents and scratches. You are more confident driving your car to even the most congested part of the city or town than a brand-new vehicle.

3. You Get Warranty

Back in the old days, you just had to rely on the seller’s or agent’s verbal warranty about the old car’s condition. And, of course, cunning salespersons, dealers, and individuals would say anything positive to close a sale.

But these days, with the internet and more advanced regulation, you can easily get your secondhand car’s certification and warranty.

Opting for a certified secondhand car means you get to enjoy the amenities of a brand-new vehicle. These include warranties and preferred interest rates.

4. Slower Depreciation Rate

Unlike brand-new cars, which significantly depreciate, used cars have a slower depreciation rate. In some cases, used vehicles can hold their value and even appreciate over time. Best examples of cars that have gained this ‘classic’ curl status are Peugeot 306 GTi-6, Land Rover Discovery, and Audi TT.

You could easily purchase any of these used vehicles now and resell them for more in the future. Nonetheless, you need to ensure your vehicle is taken good care of to keep it in excellent condition for resale.

5. Better Insurance Deal

Aside from saving yourself for expensive taxes, costs, and other fees associated with brand-new cars, you get lower car insurance costs by buying a secondhand vehicle.

When computing the premium, car insurance companies consider the car’s age and fair market value. However, keep in mind that most car insurers do not provide insurance coverage for vehicles over 10 years old.

Thus, you need to consider this when purchasing a secondhand vehicle.

6. Sustainability

Finally, purchasing a secondhand vehicle is actually good for the environment. The manufacturing process in any industry has a tremendous negative impact on the environment. Since sustainability is pressing to everyone, be part of the change and drive a secondhand vehicle.
Whether you are buying your first car or simply replacing an old one, a secondhand car is a better option. Furthermore, these days there are more and more durable, and quality used cars in the market.

 

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