Why You Should Never Buy A New Car
So, you’ve decided to bite the bullet and buy a brand-new car. A car with a fresh new set of everything, that won’t break down on you in the first few months. A car that’s so sparkly, it gives the stars a run for their money. This will mark the start of a new chapter in your life!
Hold it!
Before you head to the dealership and hand over your hard-earned cash, we’re going to discuss some of the reasons why purchasing a new car right off the assembly line may not be the best idea.
7 reasons why you shouldn’t buy a new car
1. New cars lose value quickly
As soon as you drive your new car off the lot, it’s going to depreciate. Studies have shown that a new car can lose more than 10% of its value in the first month alone! This means that if you paid $30,000 for your brand-new car, it’ll be worth $27,000 one month later. Ouch!
This also means that should you change your mind about it within the first few months, you’ll be down thousands of dollars.
2. You’re more likely to get into an accident
This might be hard to believe, but according to a study done by the insurance company Admiral, drivers of new cars are almost 21% more likely to make an insurance claim than drivers of cars older than one year. This would suggest that drivers of new cars get into more accidents.
A reason for this might be that new cars have more features that can distract drivers, such as in-car infotainment systems. Another possibility is that people feel invincible when they’re behind the wheel of a new car and take more risks.
3. New cars can cost more to insure
This does depend in part on which insurance company you use, but some companies will charge higher rates for new, high-spec vehicles than older models. This is usually because newer cars are considered more of a liability and thus more expensive to repair or replace if they’re involved in an accident.
Another consideration that insurance companies take into account is the crime rate in your area and how often cars of the same model and age are stolen. If you live in a not-so-nice area, the chances of your new car being stolen are higher, and your insurance rates will reflect that.
4. You might not be able to haggle on the price
If you’re planning on negotiating with the dealership on the price of your new car, think again. With a new car, the sticker price is usually set in stone and there’s very little wiggle room for negotiation.
The reason for this is that dealerships don’t need to haggle over the price of new cars because they’re in high demand. They can simply charge the full asking price and people will still line up to buy them.
5. You might have to wait for your new car
If you’re dead set on buying a new car that’s just been released, be prepared to wait. It can sometimes take weeks or even months for a dealership to get its hands on the newest models. This is especially true if the car is in high demand or if there’s a limited supply.
6. It might not be worth it
When you buy a new car, you’re also paying for all the bells and whistles that come with it. Features such as heated seats, in-car entertainment systems, and navigation systems all add to the price tag.
While these might be nice to have, they’re not necessarily essential, and you’re often paying a premium for them. You can usually find older models that have similar features but don’t cost as much.
7. A slighter older car could be a better deal
If you’re not set on having the newest car on the block, you might want to consider purchasing a car that’s a couple of years old. These cars will have already taken the biggest depreciation hit and will cost far less than brand-new cars.
Also, with the amount you’re paying for your new car, you could probably buy a fancy used car instead.
Final thought
While there’s nothing wrong with buying a new car, it might not be the best decision from a financial standpoint. There are often better deals to be had on older models, and you won’t have to worry about your car depreciating as soon as you drive it off the lot.