The Benefits of Buying Used
In the past, buying a used car was associated with a certain amount of risk. There’s a reason some people referred to it as, “buying someone else’s problems.” But is that still the case today?
The quick answer: not at all. Let’s take a look at three of the main reasons buying a used car today is a decision you can feel good about.
Reliability has taken huge steps forward over time in car manufacturing. There’s a reason cars have been getting and more expensive, and it’s not just inflation- the effort, materials, and craftsmanship going into them have all improved. Simply put, modern cars are built to last
While people are still trading in and selling their cars, those vehicles today still have a lot of life left in them. In the words of Kelley Blue Book’s executive market analyst Jack Nerad, “Used cars are a great value. Cars today are really good and last a long time.”
Same Old Depreciation
Even with these advances, a new car’s value still depreciates rapidly after purchase. You’ve probably heard how a new vehicle depreciates about 20% the moment it’s driven off the dealer’s lot. On top of this, most lose another 10% in value in their first year. So if you’re buying a $30,000 car that’s a year old, you’re already going to be saving about ten grand.
For buyers of used cars, it’s great news that despite improved reliability, value still depreciates like it used to. According to Nerad, buying a vehicle that’s two years old and driving it until it breaks down is the most cost-effective way to own a car. That’s because the depreciation levels out after a car’s second year, and doesn’t change much again until year five.
Improved Warranty Options
In the past, buying a used car meant you weren’t going to get a warranty. These days, there’s a variety of options to make sure you’re covered, such as buying warranties from a dealership or a third party. Certified Pre-Owned programs come with warranties from the original manufacturer. Additionally, vehicle warranties are often transferable, so if you’re buying used and the warranty is still active, the remaining time on that coverage will transfer to you.
With all this in mind, it’s easy to see why Philip Reed, senior consumer advice editor of Edmunds.com, says, “I am a big fan of buying used. I think it’s an extremely important way for a family on a budget to save money.”