Will a Used Vehicle Cost You More than You First Thought?

Car Salesmen Tricks They Do Not Want You To Know

One of the biggest benefits of buying a used car is that annual depreciation is lower than a new vehicle. But used car prices have soared over the past year and are now 40% higher than they were this time last year. As a result, it will now cost you more than ever to become a used car owner. So, is it really worth buying a second-hand vehicle?

Upfront costs 

Right now, the average cost of a used car is $33,000. In 2019, it was just $17,500, so you can see how much of a jump there has been. The typical new car price has gone up too, but only by 15% to $45,000. One thing to think about is how you’ll pay for your used vehicle. It’s been reported that 64% of all cars bought on finance are second-hand. 

Auto loan rates for used cars can be anything from 3.66% to 20.58% and are usually more expensive than a loan for a new car. These figures show that, in reality, you’ll pay a lot more than $33,000 for your vehicle. You may also have to pay a sales tax, documentation fee, extended warranty, and destination fee when you complete your purchase. All of these can add several hundred dollars to the final price of your used car.

Protecting your vehicle 

One essential car expense which is less expensive for a used vehicle is auto insurance. It’s usually cheaper to buy a car insurance policy online as you can compare rates and get multiple quotes. Before completing your purchase, double-check that the policy you’re buying gives you everything you need, including a fair price, a suitable car coverage limit, and a driver discount.

Insurance for a used car is usually cheaper than insurance for a new car because the amount of technology used in the latest models increases their repair costs. You can also save on auto insurance for your used car by reducing your coverage. Cash buyers also have the advantage of not having to fork out for additional comprehensive and collision coverage, which could save you around $380 per year.

Vehicle maintenance 

Used cars tend to be more expensive to maintain than new cars. The older they get, the more used vehicle cost you each year. Statistics show that a 5-year-old car has average maintenance costs of $350 per year, while a 10-year-old vehicle will cost around $600.

But, there are some used cars which are cheaper to maintain than others. Rath Auto Repairs reports that the Toyota Corolla, Honda CR-V, Lexus N-X, and Mercedes C Class are the best used cars to buy if you want to limit your maintenance expenses. 

Used cars have always been a popular choice. But, they’ve quickly risen in price and have become unaffordable for many. It’s important to note that there are lots of additional expenses on top of the used car price, and you must consider these before investing in one. 

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