Buy a Used Car, Save A Ton of Cash
18 May 2007
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Thats right, don’t buy a new car ever. It’s not necessary. Contrary to our parent’s beliefs, cars these days are designed to last very long. You can put 200,000 miles on most cars without any major issues. You might not get the new car smell, but you also won’t take huge depreciation hits from the moment you drive off the lot. The best bet is a late model used car, as long as it meets the following criteria:
1. Good history First of all, any car you are looking at must have a good history. It doesn’t matter what car it is, if it was abused, you don’t want to own it. You must get a vehicle history report through Carfax. They tell you about previous accidents, ownership history, maintenance history and previous locations. Of course you want to avoid a car thats been in an accident, had tons of previous owners, or located in a rust or flood happy area. Try to find a nice one owner lease return with maintenance records.
2. Practical Get something you can actually drive and fits into your lifestyle. If you plan to have many passengers, avoid the Honda S2000 above. But if you’re not planning on driving a baseball team around all day, you don’t need a large SUV. Try to buy what you need rather than what you want. My current favorite in this area is a nice sports sedan, maybe a larger coupe with backseats.
3. Reliable This is a big deal folks. You do not want an unreliable car. Believe me it will cost you in the long run and keep you frustrated. I’ve owned a Mercedes CL600 and although it was a great looking car, it was total garbage. It was in the shop more than the road and the repair and maintenance bills can buy me another car. In terms of reliability, the smaller the engine the better. 4 cylinder > 6 cylinder > 8 cylinder etc. The more complex you get, the higher than chance of something failing. Japanese cars win here hands down. They break less frequently and when they do, they are much less expensive to fix. But beware, when it comes to reliability, the actual year, make and model plays a big role. Check out Carsurvey.org, Edmunds.com, and MSN Autos for quality reviews. To get actual owner opinions, you may also want to check out brand or model specific forums. Do a search on google. I used to visit MBWorld.org to get owner opinions and guidance for my problem plagued MB.
4. Sips gas Gas is a big factor nowadays, as it should be since high gas prices are probably here to stay. More than likely, the smaller the engine the better in this area. Hybrids are the best, and small cars are great too. You won’t believe how much an efficient engine can affect your monthly cashflow. You definitely want something that gets good gas mileage in it’s class. Check out FuelEconomy.gov to get gas economy information.
5. Longevity Lastly, I want to talk about longevity, this isn’t the same as reliability. What I mean here is how long you can actually drive the car and still be happy with it. Make sure you can drive the car for at least 3 years before you commit. For example, if you are considering a 2004 but the 2005 model is completely redesigned, you may want to opt for the 05 since it’ll look good for a many years to come. If you get the 04 for slightly less money, you risk losing interest after a year or two and then you end up selling it and taking a loss, then you have to buy another car and pay tax on that. Find something you can drive for 3+ years, even if it costs slightly more.
Of course, it doesn’t matter if the car fits all of the above but costs way more than the typical market price, so shop around and find your deal. Check out AutoTrader, EbayMotors, and Cars.com. Trust me, buy a used car with this criteria and you’ll be happy to have saved so much money and be driving around a nice car.
[...] of real dollars. The best way to avoid high depreciation is to just buy a used car. I wrote about buying used cars in this article. Buying a used car lets the previous owner take the biggest depreciation hit, which is the first [...]
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