Buying a car is a very large purchase and an investment you will want to reap the benefits of for a long time from now on. However, is buying a brand new car a poor or a rather smart financial decision? What are some of the most important things to consider before you buy a new car? We have gathered some tips for you – so read on to find out more.
The Down Payment
If you have already saved some money for a car and if you can make your down payment as large as possible, buying a new car is actually feasible. Because your down payment is rather large, you will have less interest to pay and you will be able to actually handle the monthly payments for your car.
On the other hand, if you don’t have much money saved, you will find that buying a used car is a better option for you. Of course, you can still buy a new car with a lower down payment, but the truth is that this can cost you a lot more in the long run.
The Advantages of a New Car
New cars are, well, new. They are built according to the latest standards, they frequently use less gas, they function better, they are more reliable and they come with a warranty that guarantees you every piece of equipment will be replaced for free in case something happens (as long as you are not at fault, of course).
Plus, there’s the great feeling a new car can offer you and the life expectancy as well. You can use a used car for just as long as you would use a new one, but keep in mind that you will most likely need to make more repairs over the course of the following years.
The Insurance
Depending on what car you want to buy and depending on your history as a driver, you will find that insurance fees are much lower for new cars – precisely because they are new and they show less likelihood to get broken very soon.
This can save you a lot of money in the long run, as the insurance can get as low as 50% cheaper than in the case of an old car. Imagine how much that will account in one, two or five years!
It Is a Personal Decision
Owning a car is a huge responsibility – so make sure to analyze all factors before you settle on a particular option. In the end, this is a matter of personal preferences and of how much you can afford spending on a car. If a new car is way out of your budget limits, you should by no means settle on one. However, if it takes just a bit of financial effort right now and saving more later, a new car will actually be a smart decision for you.
Think things through and take a decision that suits your particular situation!