The Advantages of Going Pre-Owned

Making the most of your budget is something that more and more people turning their attention towards.  In many households, car payments stand as one of the largest of all monthly expenditures, and this means that making the right car or truck decision can make a good deal of difference at the end of the month.  Thus, making a smart choice is a big deal.  There are lots of ways to tackle this problem, but one of the smartest paths to explore is to go the pre-owned route.

You might have heard that the second you drive your new vehicle off the lot that car or truck has depreciated considerably.  This is not a misconception.  In fact, if anything this point isn’t emphasized enough.  Depreciation and cars is no small matter.  You can expect your new car to depreciate substantially the second you take possession and drive off the lot.  In a word, depreciation is a killer.  

Many people don’t understand or appreciate how significant the depreciation actually is and with good reason.  In a way, the depreciation on a new car runs counter to our experiences with most other large purchases.  When one buys a home, for example, the vast majority of the time it does not instantly lose value.  If anything, we expect our homes to gain value especially over long periods of time.  However, this is not the case with a new car or new truck, and it certainly throws many car buyers for something of a loop.

The single best way of dealing with this issue is to not buy a new car or truck.  Instead buy a high-quality pre-owned car or truck that is one, two or three years old.  In this way, someone else has absorbed the depreciation and, you are left with essentially the same vehicle, but with far lower monthly payments.  And that is exciting!

The fact is that you can have essentially the same vehicle, with the same performance and functionality, but at a lower cost.  Most car buyers welcome a lower monthly bill.  With this fact in mind, you might never want to buy a new car again.  Having that extra money on hand every month to pay down credit card debit or use for other expenses certainly will feel good and leave you feeling as though you made a great decision.

Sep 24th, 2010