We all love a new car, right? Driving away in your brand new vehicle is one of life’s little pleasures, even though it has cost you a small fortune. The trouble is, many people can often get carried away by the process, and the emotions take over from the sensible part of their brains. Here are a few common blunders made by folks who are buying a new car – make sure you watch out for them the next time you make a purchase.
Unless you have an unlimited budget and aren’t bothered about losing money, then you should never buy new. At some point in the future, you are likely to sell the vehicle to upgrade it to a better model, or because of personal lifestyle changes. However, when you buy new, you can wipe up to half of the resale value as soon as you sign the ownership documents.
It’s all about depreciation. Let’s say that you buy a new vehicle for $10,000. Assuming you are going to keep hold of it for at least three years, you can expect depreciation of anything up to $2,000 every year. So, by the time you come to sell it, you will have lost up to $6,000 – plus the cost of any repairs and maintenance that you have to pay for.
Look into buying cars at least two years old if you want to get the best resale value. Low mileage options are the best bet, and will enable you to get a far better percentage back from what you paid in the first place. And, if you are careful and buy from a responsible seller, it’s just like buying new anyway.
Buying for value
Knowing what a car is worth is going to get you the best deal possible. Look online at used car sites to get an idea of what you will need to pay. The most important things to consider are the make, model, year and mileage. Once you know those figures you can start to look into how much reduction to expect from minor damages.
Armed with this knowledge, it will be easier for you to spot a bargain and maybe even start haggling with the seller. Once they know that you have the knowledge, they will be more likely t strike a deal.
Before you buy any car, you should do a lot of research. Let’s start with the vehicle, and take a look at everything you need to find out.
First of all, it’s best to have an idea of the costs of running the particular model you are after. Tax, insurance and fuel costs can all add up, and for a vehicle with a large engine, those can easily run into hundreds of dollars every month. Never look at a car without understanding the total costs – not just the price on the windshield.
Also, as we have already alluded to, never make a purchase based on your emotions. Sure, you might fall in love with an incredible sports car that seems to be at an affordable price, but is it the right option for you right now? Practicality is as important as affordability, so make sure your head is in control of your heart at all stages of the buying process.
These simple tips can save you a lot of money in the long run – so make sure that you keep them in mind the next time you buy a car.