It’s almost that time again, the time of year when we make promises to ourselves in the hope of improving our lives or becoming a better person. That’s right, the New Year is just around the corner. It’s a practice that dates back over 4,000 years, since the time of the ancient Babylonians, which means we have been making unrealistic pledges for four millennia! Well, it’s time to start setting more realistic goals. How about this as a practical New Year’s resolution: stop driving that beater! Regardless of your credit score, whether you have no credit or bad credit, this is a sensible goal that would make even the Romans envious.
If you need more motivation to finally trade in that clunker in your garage, consider that today’s used cars are a better value and more reliable than ever before. At this point, buying a new car means paying thousands of dollars just for that “new car smell.” Buying a new car is by far the most expensive way to approach your car search. According to Kelly Blue Book, the average new car costs upwards of $37,000, while the average price for a used car is in the neighborhood of $20,000. When you factor in the higher cost of insurance for the higher-priced vehicles, the gap becomes even more pronounced.
The growing presence of good pre-owned certification programs and warranties is also a nice perk for buying a used car. Knowing that the car has been vetted by trained professionals and that the dealer is willing to stand behind the car, brings added value and peace of mind. Now you can walk off the dealership lot knowing you made a smart, budget-conscious choice.
Maybe the best perk of buying a used car is the trim options available to you. With an abundance of inventory, you can find and afford those leather seats you’ve always wanted. Or maybe a luxury vehicle drops into your price range. You also have the ability to monitor the inventory until that perfect car comes in, or until you decide what exactly you want.
Bad Credit? No problem
It might be that you have been putting off buying a new-to-you car because you are concerned about your credit score. This is a legitimate concern, but today there are many options to help you get financing regardless of your credit score. Bad credit is definitely not the obstacle it once was. Banks are more willing to work with you now, knowing that most people need a car to have a chance at rebuilding their credit score. Car dealerships are also more apt to work with you and find a deal that makes sense for you in the hope of building a relationship with you, so that once your credit has been repaired, you are more likely to come back and work with them again.
The second you drive your new car off the dealer’s lot, the value decreases significantly. We’re all aware of this, but sometimes the idea of the latest model or newest technology is too much to resist, and we buy the new car despite the obvious loss of value. But most of the car’s value is lost in the first few years of owning the car. So buying it when its value has leveled off means that the car will hold its value for you much more than if you were to buy the car brand new. Let the previous owner absorb the bulk of the car’s depreciation. That’s smart. If we consider that a new car loses 30% of its value in the first year, what happens when you sell it a few years later? Say your car costs $40,000, and you could expect to resell it for only a little more than $20,000—that’s a hypothetical hit of $20,000 in only a few years. Of course, some car manufacturers hold their value better than others, so it’s important to research what cars are known for long-term value.
Used cars today are also built better than ever before, and because of this, dealers are willing to stand behind them with CPO programs and warranties. The CPO programs eliminate any concerns about the vehicle’s history. These are the cars that are often cherry-picked and have a clean history with lower miles. The CPO programs offer the reassurance of protection against defects and expensive repairs. The vehicle has passed a multipoint inspection to ensure there are no systems or components that need to be repaired.
Today’s used cars are much more reliable than ever before. It’s not true anymore that you are buying someone else’s problems, as the old saying goes. As technology gets better and better, so should your expectations. Cars are now more dependable and advanced. While all cars require regular maintenance, today’s cars can be driven much farther between scheduled maintenance appointments, the brake pads last longer, etc.
It’s not just that cars are more reliable than ever before, they’re lasting longer than ever before as well. 100,000 miles on the odometer does not carry the same deterrent as it once did. Many models now go much farther. You don’t need to worry about buying a car with over 100,000 miles on it anymore, knowing that the car will have a much longer life. What this means for you is that you can buy a car with higher miles now and not have to worry so much about expensive repairs or catastrophic failure. And if you’re willing to buy a car with higher miles, you can get more for your money.
If you are still concerned about a vehicle’s reliability, there is a great deal of data out there for you to research. Car makers redesign their models every five years or so, with possibly a new engine or transmission, or other technological features. If you know which year you are interested in, you can check the vehicle’s history and see if this generation is known for its reliability. You can also see how this model has depreciated and if it is holding its value. With this knowledge, you will be able to have a good sense of what you should be paying for this vehicle, and know you’ve made the right decision.
Forums and car sites also offer a wealth of information on makes and models, and can be a valuable resource when researching recalls or general quirks. If that’s not enough to reassure you, there are even more resources out there, such as vehicle history reports. Here you can protect yourself against fraud, totaled vehicles or flood-damaged vehicles, salvaged titles, etc.
So really, there is no reason not to trade in that beater for the used car of your dreams. With the value and reliability offered in modern-day used cars, there is no better deal out there. If you are looking for good fortune for the New Year, buying a reliable used car is the best way to set the stage. And now you are armed with all of the resources available to you to ensure you find a great choice with tremendous value. Don’t be afraid to set yourself up with a positive start to the New Year as you look to the future and beyond from the comfort of your leather seats.