Many people do not consider that they have a choice when buying an automobile, they need for conveyance. They assume since they usually buy new shoes and new clothes, a car is something that should be bought new also. If you don’t have enough money to buy something now, you might consider personal loans or other credit options. But, is this always the wisest thing to do? Try to look at some used cars in noblesville before purchasing your next car.
What if you owned a 2015 Toyota Camry, sold it this year for $6,000, and took the money and made a down payment on a new $24,000 car? You would have to finance $18,000. According to some reports, the current national average for a car loan is 5.75 percent, and government statistics inform us that the average car loan is for a period of more than four years. Let us say you finance the car for six years. Your monthly payment would be about $320 a month. Six years later you would have paid $23,000 out of pocket for the car and you will have only $6,000 to show for it if you took very good care of the car and can get that price when you resell it. That means no accidents, no eating or drinking in the car, getting the oil changed and other maintenance taken care of on schedule and keeping the mileage low to average. In other words, you will need to have a bit of luck and be very careful in taking care of your car if you want to get a good resale value on it six years later.
Now pretend that you keep your 2015 Toyota Camry or that you are the buyer this year that bought it for $6,000. You have no car payments, so if you get laid off from your job or have other temporary financial setbacks, there is no stress from the possibility of the car being taken by the repo man. Granted it’s a used car so we might need a little extra for repairs, let’s say $100 a month. You still need to get the oil changed and regular maintenance done on the car like the new car, but you don’t need to sweat over a few coffee spills on the upholstery or scratches and dings on the paint since you know the car will be worth little when you are ready to get rid of it anyway. Where will you be in six years if you sock away the extra $220 a month in a rather lousy investment CD with a rate of one percent? You will have $16,000 in savings. That is surely plenty of money to buy another nicer and newer car.
So, who is the smarter consumer? Who is on their way to being able to always buy nice cars? Just by buying a used car in Noblesville and abstaining from borrowing money to buy a new car a consumer can have the money in the bank to buy all their cars new if they so desire. Also, after a little time of driving an asset, they own free and clear, consumers may find they like the way that feels, even if the car does not look showroom perfect. They say there is an air freshener you can buy for that new car smell. Also bear in mind that our calculations did not take into account the amount you can save every year on ad valorem taxes and insurance for less-than-new cars.