New Car Versus Used Car Purchase

[YY1]

Be careful paying cash for a new car. It can be quite a bit more expensive.
There are incentives from the finance division that can be thousands of dollars.
Do your homework and do "the math".
Most times it's better to finance with the maximum down payment, make the minimum number of payments at the maximum amount, and then pay off in full.
My wife saved $2000 doing that, versus the $69 in finance charges and interest she paid in three months.
Buying "last years model" is almost always a good financial move.
That particular vehicle- 2020 Hyundai Kona, was $3500 less than the 2021 models and the only difference was the available colors.

I tend to buy my cars at roughly 2.5 years old and about 30,000 miles, then I drive them until they aren't worth anything and sell them for $1000 with 200,000 miles or more if I can after about 8-10 years.
I tend to save $8000-$12,000 in depreciation, while the vehicle is still under the remainder of the factory warranty.
Any major repairs should have been already completed, although there's always the possibility that a looming repair was not done and that is why the vehicle is for sale, again- do your homework.
I am on my fourth vehicle doing this, and it has worked very well.

 

[stoutblock]

I come from a long line of horse traders. My Dad never bought a new car. Back in the 60s his job required him to drive 35K to 40K a year and his cars of choice were all Cadillacs. He would find a nice 2-3 year old Caddy with new Michelin radial tires and drive it until it needed new tires and then he would find another with new tires. He had a couple of tricks. One was he made sure to always have cash to buy it. Cash talks. Second he made sure he did not wait to find a car when he was desperate for one. He would keep his eyes open and pounce when an opportunity arose. This way he could be patient selling his current car in order to get top dollar. Another trick was to buy Caddy convertibles in the Winter and sell them in the Summer. My Dad knew cars well and was picky to find cars in good condition. He always did his own maintenance and repairs. If he did need tires he also bought them used from the used racks at tire shops. Again always Michelin radial tires. It was not uncommon to see a dozen used Michelin tires stacked in the garage. He always mounted them himself using a bumper jack and an old leaf spring. He had a bubble balancer (bought used). He typically went through 3-4 Caddies a year in the 60s.

I mostly buy new for daily drivers but own and often flip several older collector cars for fun. Its in my blood…

 

[H2oman7.62mm]

Of the 60 plus cars and trucks I have owned 3 were purchased new, and I can honestly say that I'll never buy a brand new vehicle ever again. Today's prices are pretty insane, and I do not like all of the electronic gizmos that are in newer vehicles built after 2014.

Lately I have been buying higher mileage V8 powered Toyota products, and that has been working out very well for me.

I haven't paid more than $5k for any of these used V8 powered Toyota products.

 

[ernieb1536]

Up until a few years ago we have only been used car buyers. Then the wife needed a different vehichle due to the unexpected death of her Hyundai Sonata. At that time a used Sonata with about 60K on the odometer could be had for about $12K. However, at a Dean Smiths in Idaho they had a promo on a base Chevy Cruze for 14.9K. We bought local for $500 more, but essentially got the same price.

The wife just paid that car off today. It has 65k on the odometer, and is slightly under 5 years old. In the past I have always followed the logic that a used car is a better value than new, and that you save all the money in depreciation. In most cases it may work that way, but not always I think.

We have discussed this a bit, and if she continues to make her car payment to a savings account, when this Chevy is ready to be replaced she will have enough cash set aside to pay for a new car. Or at least most of one. My wife is not the type of person that wants to buy a new car just to have one, she is more of the type where she sees the utility of it, and as long as it works she keeps things. So with 65K on the car, its quite conceivable that the car will go another 5 to 7 years before it needs to be replaced. In Western Washington we do not pile up the miles on a car at the rate we did in Eastern Washington. She lives about 7 miles from work, while before she was about 35 miles from work.

Seems to me that if you buy your car on a special, year end close out, or something along those lines, its possible to buy a new car and get greater utility than buying used. But you have to be in it for the long haul, and be willing to buy value and utility over style/color/make.

Cheers
Mister Pig

My wife and I are the same recently bought a 24 subaru forester end of the run loaded for not much more than used ! Plus full warranty ! Made payments to ourselves for years ! Always had gm , but needed something that a small woman would like to drive but a larger man could fit in and like ! lol it fits the build and was reasonable for new vehicle ! Plus very reasonable to insure , up to 30 mpg on the highway even being all wheel drive ! My secondary vehicle is a nice 1993 full-size blazer it’s been great ! It’s like a favorite pair of worn but very comfy pair of jeans ! And at only 153000 miles is just getting broke in ! We’ve already started saving again for the next vehicle if needed , I always say make interest don’t pay it ! You don’t have to be well to do, just frugal !

 

[ernieb1536]

I come from a long line of horse traders. My Dad never bought a new car. Back in the 60s his job required him to drive 35K to 40K a year and his cars of choice were all Cadillacs. He would find a nice 2-3 year old Caddy with new Michelin radial tires and drive it until it needed new tires and then he would find another with new tires. He had a couple of tricks. One was he made sure to always have cash to buy it. Cash talks. Second he made sure he did not wait to find a car when he was desperate for one. He would keep his eyes open and pounce when an opportunity arose. This way he could be patient selling his current car in order to get top dollar. Another trick was to buy Caddy convertibles in the Winter and sell them in the Summer. My Dad knew cars well and was picky to find cars in good condition. He always did his own maintenance and repairs. If he did need tires he also bought them used from the used racks at tire shops. Again always Michelin radial tires. It was not uncommon to see a dozen used Michelin tires stacked in the garage. He always mounted them himself using a bumper jack and an old leaf spring. He had a bubble balancer (bought used). He typically went through 3-4 Caddies a year in the 60s.

I mostly buy new for daily drivers but own and often flip several older collector cars for fun. Its in my blood…

Sounds like my dad ! His favorite used caddy’s 63-64 had a bunch of them including a rare 1963 caddy park ave very rare ! A 64 caddy convertible with the 429 cid engine ! 65, 67, 69 and then 71-74 and multiple 78-79 Caddy’s ! Now has a 06 and 13 devilles

 

[stoutblock]

Sounds like my dad ! His favorite used caddy’s 63-64 had a bunch of them including a rare 1963 caddy park ave very rare ! A 64 caddy convertible with the 429 cid engine ! 65, 67, 69 and then 71-74 and multiple 78-79 Caddy’s ! Now has a 06 and 13 devilles

The last Cadillac my Dad bought was a 1973 Eldorado convertible with the 500ci engine. He had that until 1978 or so. He did not care for the newer caddy’s. He did find a nice 1964 Coupe Deville he kept until he passed as he really liked that year. My nephew owns it now. By modern standards they are huge boats but in their day they were awesome cruisers!

 

[ernieb1536]

The last Cadillac my Dad bought was a 1973 Eldorado convertible with the 500ci engine. He had that until 1978 or so. He did not care for the newer caddy’s. He did find a nice 1964 Coupe Deville he kept until he passed as he really liked that year. My nephew owns it now. By modern standards they are huge boats but in their day they were awesome cruisers!

Still are awesom cruisers plenty of style power and comfort !

 

[peet_pete]

So I sold my 2002 (purchased new) car a couple years ago to pay for my used 2012 vehicle, which gets way better gas mileage and had only 60k instead of 200k.
That 2002 car should be my only new vehicle ever. I am trying to follow a rule of max depreciation. So after 3 years or so, I've had $1200 in maintenance and repairs as opposed to my other car, which peaked at about $3k for one year. Some cars are really only worth keeping if you can work on it yourself.

I also came up with a kind of brutal formula that calculates distance to work, insurance paid, mpg, cost of fuel (adjustable) and some other variables, that showed me, in total, what I would pay to go to work. Just for car ownership. Per trip. Of course, normally that would be just in the budget but it was useful for deciding between options.

 

[ernieb1536]

So I sold my 2002 (purchased new) car a couple years ago to pay for my used 2012 vehicle, which gets way better gas mileage and had only 60k instead of 200k.
That 2002 car should be my only new vehicle ever. I am trying to follow a rule of max depreciation. So after 3 years or so, I've had $1200 in maintenance and repairs as opposed to my other car, which peaked at about $3k for one year. Some cars are really only worth keeping if you can work on it yourself.

I also came up with a kind of brutal formula that calculates distance to work, insurance paid, mpg, cost of fuel (adjustable) and some other variables, that showed me, in total, what I would pay to go to work. Just for car ownership. Per trip. Of course, normally that would be just in the budget but it was useful for deciding between options.

My last vehicle was late model used , had it for 14yrs . Started with 32k miles ended up with 160k only make expense tranny at 100 k ! Was going to go the same this time but a couple of things made me change my mind (1) not a huge difference in price with the new car discounts and high resale of the vehicle (2) start stop feature is hard on engines and electrical systems if not turned off every time , I don’t care what they say starting a motor and those few seconds without oil pressure is hard even on modern motors and did the previous owner change the oil on a regular basis or waited till it was time to turn it at the end of the lease !(3) ac systems are one of the first major repairs and my wife runs ac a lot ! (4) being near retirement age good to have a new vehicle to start with a full warranty ! Now for our secondary vehicle if my other vehicle dies , yes it will be most likely used with lower mileage but not in the late model camp just decent transportation , there’s good reasons to go ether direction when it comes to vehicles , my last brand new vehicle was in 1991 ! Lol

 

[MX117.MC7150]

I was talking about low mileage, like 30 or 35K

Dealers usually have plenty of lease turn-ins with about 35K miles. You may need to go 'out of town' to find what you want, but the internet is a good thing for shopping.

 

[mr_light]

We recently bought a Rav4 2021 30k miles that just came off lease. I liked the idea of buying a used car that has at least a few months left on the factory warranty. This gives me time to check out EVERYTHING and at least get any problems reported to the dealer before the warranty runs out. I also like the dealers requirement for regular maintenance while on lease. Worked out for us.

 

[ernieb1536]

Up until a few years ago we have only been used car buyers. Then the wife needed a different vehichle due to the unexpected death of her Hyundai Sonata. At that time a used Sonata with about 60K on the odometer could be had for about $12K. However, at a Dean Smiths in Idaho they had a promo on a base Chevy Cruze for 14.9K. We bought local for $500 more, but essentially got the same price.

The wife just paid that car off today. It has 65k on the odometer, and is slightly under 5 years old. In the past I have always followed the logic that a used car is a better value than new, and that you save all the money in depreciation. In most cases it may work that way, but not always I think.

We have discussed this a bit, and if she continues to make her car payment to a savings account, when this Chevy is ready to be replaced she will have enough cash set aside to pay for a new car. Or at least most of one. My wife is not the type of person that wants to buy a new car just to have one, she is more of the type where she sees the utility of it, and as long as it works she keeps things. So with 65K on the car, its quite conceivable that the car will go another 5 to 7 years before it needs to be replaced. In Western Washington we do not pile up the miles on a car at the rate we did in Eastern Washington. She lives about 7 miles from work, while before she was about 35 miles from work.

Seems to me that if you buy your car on a special, year end close out, or something along those lines, its possible to buy a new car and get greater utility than buying used. But you have to be in it for the long haul, and be willing to buy value and utility over style/color/make.

Cheers
Mister Pig

That’s what I did paid cash for new after saving for years ! Make interest don’t pay interest if possible !

 

[ernieb1536]

I'll never buy new again unless I hit the Loto. I bought a new 99 GMC Z-71 4x4 with all the bells and whistles and it was a steaming pile that always had something going wrong with it. I sold it with a thousand miles left on the warranty and lost 1300 bucks on it and was happy to see it go. In the years following we inherited a 99 Chevy Venture which we parked still running with over 300,000 miles on it Our current daily driver is an 01 Silverado 2 wheel drive that we bought with just under 200,000 miles on it. The last time the stupid LED odometer worked on it, it was showing 250,000 miles and has been almost trouble free. My summer car is a 1967 Chevy Belair and it's got the lowest miles on it out of anything I've owned in the last decade (111,000 miles since new). I'll take my chances with used stuff (Mostly Chevys).

Old chevys are hard to beat love my 93 full-size blazer 5.7 ltr throttle body had for 22 yrs 160,000 still runs great ! Had to replace the 08 uplander 160000 , ran good till the body rusted out and the rear wheel well fell out cut wires and shorted out the body module ! We had it for 14 yrs bought it late module used it was a rental car , it was 2 yrs old and had 32k got it for 15k when a lot of uplanders were still around 20 k

 

[sanford12]

Old chevys are hard to beat love my 93 full-size blazer 5.7 ltr throttle body had for 22 yrs 160,000 still runs great ! Had to replace the 08 uplander 160000 , ran good till the body rusted out and the rear wheel well fell out cut wires and shorted out the body module ! We had it for 14 yrs bought it late module used it was a rental car , it was 2 yrs old and had 32k got it for 15k when a lot of uplanders were still around 20 k

Some old Fords do well too. We bought a 96 Aerostar that was a rental. Exact same milage at 32,000. Had a couple small things fixed under warranty right off the bat and a front end rebuild at 110,000. That was pretty much it. 4 liter V6 is a great reliable motor. Traded it at 186,000. Everything still worked and it didn't burn oil. Wife was tired of it and the rockers were rotting. Great van for travel and pulling a pop-up. Many fond memories were made in that vehicle.