The Benefit of Buying Used Car for Your Financial Health. When you ask about buying a new or a used car, most financial experts will agree that buying used car makes more sense than buying a new car. A new car might come with several benefits, for example you don’t have to worry about the condition of the car. But unfortunately, buying a new car will require you to reach deeper into your pocket.
Let’s take an example. You have a 2014 Honda Civic. Then this year you sold your Civic for $12,000. You took that money and made down-payment for a $30,000 new car. It means you would have to finance $18,000 for your car. If the average car loan would be 5.75 percent, and let’s say you take a six years period for that loan. After you calculate it, your monthly payment would be $320 per month. In the next six years, your total payment would be $35,040. If you take really good car of your car, you will be able to sell your car again for $12,000.
When you buy a new car, its price will depreciate the minute it drives off the dealer’s lot. To minimize the impact of this depreciation factor on your financial status is by buying used car. The depreciation value will not be as much as when you buy a new car.
Now let’s pretend that you are the buyer of that 2014 Honda Civic, and you spent $12,000, just like the example above. You don’t have that monthly payment as above. It means there will be no stress about if the car is being taken by the repo man because you miss your monthly payments. It will be less stress about keeping your car scratchless and well maintained, because you already know that will just be worth a little when you plan on getting rid of it. Imagine how much money you can save from that monthly payment. You will have extra $23,040 in your pocket. That is surely enough money to buy nicer and newer cars.
Two examples above display how buying used car will benefit you more in terms of financial health. Choose a car within your budget so that you don’t have to look for a loan or a car credit. Carefully research the right car for you. Don’t hesitate to go to several car dealers, or you can also seek for cars on the internet. Another way to find a good deal on a used car is by going to used car auctions. There are usually many value-for-money cars at those auctions.
You don’t need to rush in the process of buying a car.Always inspect your car and do a test drive before taking a deal to make sure the car you want functions and runs well. Don’t get trapped in super low prices because there might be something fishy about that car. Have a good mechanic around to help you in choosing the right car, so you can have a car that is worth every dollar you spend.