A car is usually the second most expensive physical purchase a person will make, right after buying a home. Many people try to haggle and get a great deal on a new one, but unfortunately, as soon as you drive the car off the lot, you could easily lose thousands of dollars in value due to the immediate depreciation. For this reason alone, you should consider buying a used car instead.
Others try to save money by buying a newer used car. This works because you allow someone else to take the immediate hit of new car depreciation, and you swoop in and pick it up. However, if you really want to save a ton of money and still get an amazing vehicle, here are some tips for buying a used car that's older.
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How I Snagged My First Used Car
My first car was a seven-year-old Japanese sedan with just over 100,000 miles on the odometer. I was a high school student at the time and was super thankful that my parents took care of half of the cost of the vehicle, which we bought for $5,000.
It was in great shape, was mechanically sound, and wasn't missing too many of the features that appeared in the brand-new cars, yet it cost much less than a new car or a late-model used one.
The same vehicle had a manufacturer's suggested retail price of nearly $20,000 when it was new.
I drove it for six years, added 30,000 miles, and sold it for $3,200.
I only lost $1,800 — or $300 per year — to depreciation over six years, while the previous owner had lost almost $15,000 — or roughly $2,150 per year — over the first seven years of the car's life.
You, too, can save massive amounts of money in depreciation by doing the same thing that I did. Once it gets older, the price difference between a fully loaded version of a car and the basic model isn't anywhere near as much as it was when it was new. This may make older used cars even more attractive than late-model used ones because it means you could get a nicer version of an older car for a much better deal.
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Finding the Most Reliable Used Cars
When you're looking for your older used car, you need to do a bit of research to make sure that you find one that will last. Many companies review the reliability of used cars, including Edmunds, Consumer Reports, and Kelley Blue Book.
The best part about buying used is that there are years of data showing how these cars hold up.
While the used car you buy might have only, say, 75,000 miles, there have likely been other cars of the same make and model that have been driven for 200,000 miles or more. The data from these other cars will help you predict how yours will hold up, assuming that you follow the recommended maintenance schedule.
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Finding the Right Car For You
You’ll need to do a bit of digging to find an older used car that has been kept in great shape, but they're much more common than you'd think.
My favorites are single-owner cars from people who keep detailed maintenance records. These aren't easy to find, but when you do find them, they can be amazing deals. Still, I recommend taking any used car to a mechanic you trust and getting it checked out before you buy. For a small fee, you can make sure to avoid buying a lemon — just by having a professional do a quick check!
Buying a car is a major financial decision. You owe it to yourself to at least consider older used cars before you head out and buy a one that's brand-new or a recent model. You could easily save yourself thousands of dollars and still get a nice, reliable ride. It just might not be quite as shiny as your neighbor's.