Wondering if you should get a new or used car?
So many people wonder the same thing and so many give all kinds of advice.
“Buy new so you know there are no problems with your car”
“Get a used car so you can save more money”
What’s funny is I never thought about that when I was in the market for my first car.
As a matter of fact, I didn’t even put much thought into the whole process.
Now that I look back at how everything went down, I could’ve made a lot of smarter decisions, especially when getting my first car.
The problem back then is I didn’t know any better.
Ask me the same question and I would tell you the many stupid reasons why you should get a new car.
Fast forward to today and I can give you a much better answer that can help you save more money as well as your overall life.
But, we are all different.
We all have different wants and we most especially have different needs.
Personally, I almost never favor the wants as that is something that will keep you broke, so I want to go over the more important part of the car buying process.
So before you even consider which car you will buy, you might want to look at your current situation as this is really what should make your final decision.
Do You Have a Family?
For the most part, those of us with families will always have to focus on more things than those that don’t own any humans.
How much space do you need?
That’s probably the one question that will have the biggest impact on your final decision.
That SUV that you feel you need might just be out of your budget regardless if it’s new or used.
Now if you are single and don’t have any kids, your best bet will always be to buy used.
Focus on building your career or financial portfolio then consider buying a new car.
For now, a nice reliable used car will work just fine.
What Kind of Job Do You Have?
I ask the question not to see what kind of fancy car you will buy but to see if buying new will actually be better for you.
If you can afford a decent car payment and still have a good amount of money to live off from then a new car can be one to consider.
If you feel or know that you will be in a bind by taking on something like a car payment, you definitely don’t need to get a new car.
Even at that, find a nice reliable used car and make it work.
Now the main reason for the job question is to see if your soon to be vehicle will be required for your job.
There’s definitely no need to get a new car if you are going to be doing any kind of driving for work.
Use good judgment and don’t get something you can’t handle.
How Much Driving Will You Be Doing?
Cars are meant to be driven but you of course always want to save on fuel.
From your commute to work, to dropping the kids to school, all the way to soccer practice and other extra curricular activities, you need to understand how much driving you will be doing.
If you plan on measuring the road, you definitely want to go with a car that’s ready to tack on some mileage.
Used cars won’t be your best option, so you might want to let that monthly payment help with this situation.
What Do You Want/Expect From Life?
Some of us are a lot more frugal than others and some of us even have ambition.
Us entrepreneurial folks don’t know the definition of saving for a rainy day and making unnecessary purchases are a rare occasion as well.
With that mentality alone, you know that a new car is out of the question.
Get an affordable and reliable car that can take you from point A to point B.
Forget about looking cool and forget about listening to what anyone else has to say.
You have other things to focus on and a car payment isn’t one of them.
Once you have figured out your current situation, that’s when you can start figuring out if you should get a new or used car.
Why Buy New?
Not a fan of the new ride but sometimes it is going to be your best option.
Now that’s very rare as there are so many used cars that are worth a lot more than what they are sold for.
I am not completely against getting a new car but please do shop around before you get attached to something you see on the lot.
Better yet, before you get convinced by the car salesman that is trying to get that commission.
So before we get into why I think you should buy used, let’s see what will make you feel that you need a brand new ride.
1. You Want Something Reliable
Blah blah, fricken blah.
I remember when I got this advice from my mom and how it made my ultimate decision.
Unless your mom is filthy rich and not working, I would stick to learning how to cook and leave everything financial out of it.
Sure you want a car that won’t break down tomorrow but that does not mean you need something brand new.
Used cars are very much reliable and they don’t come with that dreaded monthly payment.
New does not mean reliable, so keep that in mind before you pull out a loan thinking you are getting something for its reliability.
2. You Know Everything About a New Car
This is one I can agree with but I do not think it should play a part in your buying decisions.
If you can not afford it then you don’t need it.
When you think of getting a used car, you think of some beat up car that will break down on you a mile down the road.
Thanks to this thing called CARFAX, you don’t have to worry about not knowing the history of a vehicle like we had to do in the past.
These days, you can find out all the information about a car before you even talk to the person selling it.
And back to my point on the idea that used cars are beat up, that’s only what comes to mind when you think of them.
Now that does not mean they are all that way because there are many great looking used cars that are only a couple of years old.
They will last you another 5 years so that you can build your portfolio and eventually get something you actually want.
When the time is right of course.
3. I Got Approved!
This is the stupidest and most annoying reason why anyone will get a new car.
I got approved for a new home loan but does that mean I need to buy one?
The same thing goes with a new car.
Banks will approve almost everyone these days as long as you have a job.
They really have no interest in what works best for you and they really only care about getting that nice commission.
Again, if you can’t afford it, there is no need to get new.
4. Too Many Problems With Used Cars
All used cars are not the same.
Some are not worth buying but there are those that are a steal of a deal.
The previous owners have taken better care of that car than you probably ever will and they probably just want to upgrade.
Maybe they have a new kid that requires a bigger car.
Just because a car is used does not mean it is garbage.
As long as a vehicle is maintained and not abused, cars can last a very long time.
Why Buy Used?
Now there are the excuses of buying new cars but there are even more benefits that come with the smarter decision.
I personally will always advise used before new unless one of the few points mentioned earlier are in your favor.
Besides that, I think that used cars will always be the best option for my entrepreneurial friends out there.
So for those of you that aren’t ready to commit, let me give you the main reasons why you are making a smarter choice.
1. No Monthly Payments
This is by far the biggest reason why you don’t need a new car.
For one, you most likely can’t afford it.
You think that you can but you really can’t.
What ends up happening is you go to a car dealership, you get approved, and they make you feel you are being helped because of your bad credit.
What you don’t know is they will approve almost anyone.
As long as you have this thing called a J-O-B, they know you will be able to make those monthly payments.
They don’t care if you can’t feed your kids, they just want to make that sale.
Secondly, you absolutely don’t need it.
For some of you, it’s going to be the people around you that will make you feel the need for a new car.
A co-worker or a family member might get a new car and it has you feeling that you could use one too.
Don’t do it.
Now the biggest influence on your decision to get that new car is going to be this thing called social media.
Not only are the people in your network showing off their new ride but all these famous people give you the idea that new cars is where it’s at.
I can say yes but not if you aren’t successful financially.
2. More Money to Invest
I don’t care who you are, there is an opportunity for everyone to make more money.
Whether it be in some stocks or something like affiliate marketing, there is always a way to make more money.
You can always do what I tell most people and start your very own blog.
Whatever it is, buying a new car will not help you.
That extra $300 can do a whole lot for anyone and right now is just not the time to be throwing money away.
Make more of it now so that you can buy what you want later.
That’s the way I feel with a lot of things in life and it very much applies to your next vehicle.
3. Interest Rates Are Out of This World
Getting approved for that loan is a huge step for most people looking to buy a new car.
That joy of owning something new will most likely overpower the insane amount of interest you will be paying, so please don’t let that happen.
Like I mentioned earlier, these salespeople could not care less if you had the car repoed tomorrow.
All they really care about is that $1,000 that they will make thanks to you getting that car.
By the time you’re done paying off a new car, you will have put over $5,000 of free money right back into the bank that approved you for that new car loan.
4. Cheaper Insurance
When you are in the market for a new car, insurance is the last thing on your mind.
You just want the keys and you want to be able to call it yours.
Then comes the time to sign and you are required to pay for this thing called car insurance.
And if you don’t have USAA, chances are your insurance is going to be through the roof.
Brand new cars come with a much higher insurance rate and sometimes you aren’t given the option of liability, which means you will pay a lot of money every month.
Now if you try to insure a used car, you will be amazed at how low your rates are.
I tried paying $23/month for a Toyota Corolla compared to the $85/month that I was paying for our new Toyota Highlander.
Not to mention the lower monthly fee for having two cars in one policy.
Insurance is a must so consider this when you buy your new or used ride.
So Should You Buy a New or Used Car?
Only you have the right answer to that question.
I do recommend you act your wage and get a car that goes great with your budget.
Definitely get a reliable car and one that you know will last.
If you plan on getting a new car, do not go crazy, even if the bank approves you for a decent amount.
At the end of the day, you know what your needs are.
Everyone can give you their two cents but I’m sure you will make a wise decision.
Don’t feel pressured into buying anything and don’t feel that you have to buy a car immediately.
Shop around and weigh your options.
Lastly, check some used car lots as there are always some great deals going on.
And if you have access to a military installation, you definitely want to checkout their lemon lot.
Too many military personnel are changing duty stations that they don’t have time to get rid of their car.
So what do they do?
They shave off thousands of dollars.
If you can scoop up one of those deals, I definitely say go for it.
You can always turn around and sell it in a year’s time and still turn a profit.
Besides that, I hope this post has helped you understand what kind of vehicle YOU really need.
But just like every other decision we have to make in life, there are so many different answers.
So you tell me…
Should you buy a new or used car?