Due to the pandemic effects on vehicle production, 2021 is not a normal year to buy a new car.
While it’s true that new cars offer reliability and peace of mind —- for example, you are likely to experience fewer mechanical breakdowns for the first few years — used cars are often a better option. To protect yourself from breakdowns on an older car, you can simply invest on a vehicle service contract (also known as an extended car warranty) and save a lot of money.
If you’ve already begun your search for a new car, you may have already experienced some setbacks. Here are some advantages and disadvantages of buying a new car if you’re on the fence.
Advantages of buying a new car
Despite any issues with new car purchases this year, there are some clear advantages to buying a new:
- Freedom to choose the exact car you want
- Even if availability of the make and model you want is low, it’s still worth waiting for the car you want if you have your heart set on it.
- With proper maintenance, it will last you a long time
- According to Auto Trader, research shows that the average age of a modern car is 11.4 years. With proper maintenance, you’ll be able to increase those years. A car repair insurance plan can also help you in case of an unavoidable repair.
Read our recent blog post on how often you should do car maintenance.
- Better technology
- Today there are many fuel-efficient models available in the market that can save you hundeds of dollars at the pump. Beside improving gas mileage, new car technology offers a better and more convenient driving experience. For example, new technology can diagnose mechanical problems, find you parking spaces and let you interact with your car completely hands-free.
- More financing options
- Car manufacturers offer various many options for financing to entice consumers to buy new cars. You can take advantage of those incentives and negotiate to get a new car on a very low monthly payment and interest rate.
Watch our video 10 Things You NEVER say to Car Salesperson for negotiating tips when buying a car.
Disadvantages of buying a new car
If you think of your car as an investment, buying new might not be the best choice. Here are some of the resons why:
- More expensive
- With a new car, you’ll be spending way more money than with a used car. This may be worth for some people based on savings due to better gas mileage and fewer breakdowns, but the savings you may accumulate might not justify you spending more on the purchase.
- More debt
- Unless you’re buying your car in cash, you’ll have to fiance it (get a car loan). The average car loan today is around $32,000 and the term of the loan is around 60 to 70 months.That’s about 5 to 6 years of debt that you may not want to commit to.
- Immediate depreciation
- The term depreciation refers to the value of the car when you buy it vs. the value once you’ve used it. As soon as you start to use your car, it’ll lose value. According to Carfax, the value of a new car decreases 20% in the first year of ownership.
- Higher taxes and more expensive insurance
- Sales taxes on new cars shock first time car buyers. It’s a hefty price. For example, a 9% sales tax on $40,000 car is $3,600, and it can be even higher. Different cities and counties can add their own tax too. Car insurance will likely be more expensive as well since companies give rates based on the car’s value.
Protecting your new or used car from repairs
There are advantages and disadvantages to everything and buying a new car is no different. Always weigh out your options and choose the car that offers the greatest possible value. If you decide to go with a used car instead but worry about repairs, you can buy comprehensive vehicle breakdown protection on low-cost monthly plan. This will cover your car repairs as if the car were brand new and still on a manufacturer warranty.
Uproar.car has created vehicle breakdown coverage that is simple, trustworthy and affordable. Transforming the extended car warranty marketplace through technology and transparency, Uproar.car offers a full suite of worry-free, no-haggle car care plans through low-cost, 100% online, monthly subscriptions that drivers can sign up for in less than five minutes. Get an instant quote today!