subject: Used Car Vs New Car The Debate Continues [print this page] There has never been a time when buying things was something to be more carefully considered. Spending your money in an economy that is globally less than perfect is more difficult and must be done with a bit more wisdom than when you're rolling in spare money. Buying wisely means getting the best that you can for the money that you are able to spend.
The question is what is your best value? How does a new car stack up to used car sales and which is the better value for you and your family? Most people feel that a new car is going to be the better value. Yet is that the reality? Does the lowered cost of the maintenance on your car actually give you a better value and help you to pay less in the long run?
Comparing the Numbers:
A new car, which originally sold at about twenty five thousand pounds, is generally purchased with a trade-in, or ten percent down to the loan maker. This means that it would be about 22,500 pounds financed. At about 7% or 8% loan costs, you will end up paying about 30 thousand for a car that cost originally about 20 thousand.
If we factor in all of your monthly payments and the required insurance and maintenance on the new car, those costs are significantly more. Typically it will cost you less for maintaining a new vehicle as opposed to a used one, because your car is under warranty. That is one of the benefits of the new car purchase, but are there hidden costs for that benefit? Just as with anything else this complex, of course there are hidden factors entering into play.
If you make a car payment of just 250 or 300 GBP over the months that means you are paying that, plus insurance, along with the cost of fuel, taking your monthly payments to about 450 GBP. The insurance on the new cars will cost a great deal more in most cases. You are required to pay for replacement value and most of the time for full cover on your car.
On used car sales, typically the insurance is lower in cost, the payments are lower or non-existent and the cost of your car will be much less in the long range if you purchase a used car rather than a new one. The replacement costs are less for a used car, the overall insurance fees are lowered and the monthly payments on a used car are less.
While you will likely pay more for the maintenance of a used vehicle, other costs will be significantly lower. Even if you pay 1000 GBP for maintenance and repairs during the year for your used car, with the lowered cost of insurance and the lowered overall payments factored into the equation, as you can see the cost will be far less for a used car on average. You should always work the numbers to make sure you are getting the most for your money.
