New cars vs. used cars. You likely have this debate on your mind if you're in the market for a vehicle. This guide to the benefits and drawbacks of new and used cars will help you make an informed choice when it's time to buy.

Benefits of New Cars

Image via Flickr by EDrost88

Buying a new car comes with a certain set of perks. This includes:

  • Warranty: A new car typically comes with a warranty. Though the details of warranties vary, they are used to cover costs associated with replacing parts or repairing your vehicle. If you get a car from a dealer, you'll get a factory or manufacturer's warranty.
  • Fewer repairs: Because no one has driven or used a new vehicle before, you will likely need to make just a few repairs (if any) in the first few years that you have it. This will allow you to focus on maintaining your car and will save you money that you would otherwise have to use for repairs on a used vehicle.
  • Better financing: Dealers tend to offer a lower interest rate when you're financing a new car instead of a used car. This can cut down on the amount of interest that you'll end up paying over time.
  • Technology and features: You'll get the best and most up-to-date features when you go with a new vehicle. Newer models include advances in technology, so you can hook up your phone or other devices more easily. If you enjoy using the latest technology, new cars offer that.
  • Better gas mileage: Many newer cars offer better gas mileage as well as lower emissions than older versions. In addition to being good for the environment, this aspect can save you lots of money over time from having to refuel less often.

Drawbacks of New Cars

Buying a brand-new car has certain drawbacks, too. Possible shortcomings to consider include:

  • Depreciation: You lose money the minute you drive your new purchase off the lot. You'll have depreciation, or reduction of value over time, with any car you drive. However, a car sees its biggest depreciation in its first two or three years. The car's first owner is the one who takes that hit in terms of value. You're essentially losing a few thousand dollars instantaneously when you drive off in your brand-new car.
  • Higher Cost: A new car will cost more than an older, used version of the same model. A new car is generally much more expensive than buying a used vehicle.
  • More additional costs: It's not just with the upfront price of a new car that you'll spend more. You'll likely pay more more in sales tax as well if you go with a higher-priced new car. Insurance costs will also be higher.
  • Unknown reliability: A new model year brings some sense of uncertainty into the equation. Manufactures sometimes change a car's engine or design, and that version is less reliable or popular with other drivers. If you buy a car the moment the manufacturer releases it, you won't know about potential issues ahead of time.

Benefits of Used Cars

Buying a used car comes with a different set of perks than buying new. You'll have:

  • Slower depreciation: You're letting someone else take the biggest hit in terms of depreciation when you go with a used vehicle. As a result, you may even be able to sell the car for about the same amount that you paid for it if you want a change in vehicles in the next few years. Though you won't be able to take out a zero-interest loan as you could with a new car, you may still make up the difference if you get a good financing option through a bank or credit union because you won't lose money on depreciation.
  • Lower up-front costs: A used car will cost less than a new model.
  • Easier to pay cash: Since you're not paying as much up front for a used car, you can save money ahead of time and pay cash for your down payment.
  • Lower additional costs: You'll also pay less in taxes and likely get a lower insurance rate when you go for a used car. If you're paying high insurance rates already (such as drivers in their early 20s), your lower rate on a used car can lead to significant savings.
  • Reliable model information: When you buy a used car, you can check data from Consumer Reports to see how that model has performed. You can use this information to choose a model that performs well.

Drawbacks of Used Cars

You'll also find certain disadvantages to buying a used car. Examples include:

  • Unknown history: You may not know the accident and/or mechanical history of a used vehicle.
  • Higher financing rates: Used cars tend to come with higher financing rates than their new counterparts, leading to increased costs down the line.
  • More maintenance: A used car may be less reliable than a new vehicle, and you may need to pay for repairs that wouldn't come up if you purchased a new car. Your car may also be in the shop more frequently than a new car would, taking time out of your normal routine and upping your maintenance costs.
  • Need for compromise: You can get just about anything you want if you're buying a new car. If you're going with a used model, you may not have every option available to you. You'll need to stay flexible to get the best deal on the best car. For instance, you may not get the color you want if you choose the car that offers better history or mileage.

One way to maximize your benefits is to go with a certified used vehicle. These high-quality, low-mileage options often mean a great balance for car buyers.

Is it better to buy a new or used car? The answer depends on the specific car buyer and what you want most from your purchase. New, flashy features and lower maintenance costs come with new cars. Used cars, on the other hand, can save you a lot of money overall. No matter what you decide, Kings Toyota can help you find the best deal on the right vehicle for you. Shop our inventory today!