Whether you are a first-timer, replacing an existing car, or adding to your family fleet, at some point you will need to purchase a vehicle.

Manufacturers and dealers spend millions of dollars a year bombarding you with advertisements showcasing the latest and greatest vehicles on the market. And all of these ads are designed to make you believe that you absolutely need the latest automotive gadgets, such as dual headrest DVD screens, individual temperature zones and hands-free parallel parking. And while these gadgets are fun, and do make life easier, purchasing the band-new car that comes with them can be beyond the financial reach of many families.

Even with financing, you are often looking monthly expense of several hundred dollars a month for as long as five years (and in some cases six or seven). And, what’s worse, depending on the type of car and other factors, a brand new car can lose up to 20 percent of its value within the first year. That means that after the first year of paying off the loan, even without the interest, the vehicle is already worth less than the amount financed – also known as being upside down on your loan.

Making a large down-payment will greatly reduce your chances of being upside down, and paying cash outright will remove the depreciation
trap entirely however, for many families, paying that much money up front is not always an option.

Purchasing a quality used (or pre-owned) vehicle like this Used Kia Forte can fulfill your transportation needs without breaking the bank.

Advantages of Used Vehicles

Lower Price:

Due to the rate of depreciation, even a used car one or two years older than the latest release can cost significantly less than the latest model. For example, a search of the inventory at BMW Rockville shows a 2013 BMW 128i w/SULEV for $43,245, while a used 2010 BMW 128i s/SULEV  retails for $27,949. Herson’s Kia, in Rockville, has a 2013 Optima for $35,610, while the 2009 model is only $13,293.

Another price advantage to used cars is that you can benefit from upgrades that someone else has already paid for as a dealer add-on or as an after-market installation, such a high-end stereo system or sun roof. Additionally, used cars often have many of the same safety and economy features as new cars such as side airbags – which the National Highway Traffic Safety Administration required to be standard on all vehicles in 2009 –  and hybrid engines.

In the pursuit of value, it’s worth noting that the advantages of purchasing a used car extend beyond financial considerations. Among the offerings at these dealerships, the inclusion of models like the byd ev cars underscores the evolving landscape of automotive technology and sustainability. While some may gravitate towards traditional petrol vehicles, the availability of used electric or hybrid cars presents an opportunity to embrace eco-conscious transportation options without breaking the bank. In this way, exploring the range of offerings at dealerships opens up avenues to not only find a vehicle that fits one’s budget and preferences but also aligns with their environmental ethos.

Smaller Depreciation:

Your car will continue to depreciate each year that you own it, however, because the greatest depreciation occurs in the first year, buying a used car offers some measure of protection owing more than the actual value of the car. Additionally, because used cars tend to cost less, it is also possible to make enough of a down-payment to secure a smaller, shorter loan, or buy the car outright.

Lower Insurance Rates:

If you take out a loan on the car, the lienholder will usually require you to have full coverage on your car – this includes collision and comprehensive coverage. This ensures that if the vehicle is stolen, damaged or destroyed, the lienholder can recoup the blue book value of the car. Some insurance companies also offer “gap” coverage which accounts for depreciation and will replace a car with a car of the same year or newer. Therefore, look into sites like academywestinsurance.com/commercial-auto-insurance-services-in-fresno-ca/ for additional guidance on insurance.

However, this type of coverage is expensive and, in the case of a used care, more than you need. If you take out a loan on  a used car that is more than a year old, you can skip the “gap” coverage and save money. If you can buy the used car outright, and the cost of the collision and comprehensive coverage is greater than the value of the vehicle, you can save money by only purchasing property and bodily liability and personal injury protection in the amounts required by your state.

Disclaimer:  This is a partnered post.