Buying a new car can be exciting, but when is the right time to buy a new car? How much effort should you put into buying a new car? Should you consider buying a used car?
Let’s look at some options when buying a new car and look at when the best time is to do so.
What Are The Benefits Of Buying A New Car?
- New cars are very reliable for the first few years since the car has a full manufacturer’s warranty and service plan. This is all part of the initial deal when buying your new car.
- New cars usually come with the latest technology in engine development. So, these cars are usually lighter on fuel than older cars, which is more economically viable for consumers.
- New cars typically boast new technology in the onboard entertainment system. Being able to connect your phone to the car’s Bluetooth system, makes for safer driving as well.
When Is It A Good Time To Buy A New Car?
- When there is a new model changeover: when car manufacturers introduce a new model to be launched, dealers will usually offer good discounts to clear out the existing stock.
- End of the month incentives: dealers need to reach their targets on sales. This usually happens within the last 5 days of the month.
- End of year sales: this usually happens in the last week at the end of the year. The car manufacturers are willing to lose money in order to clear their stock at that time of the year.
- The final year of a certain model’s production: this is for buyers who are seriously looking at saving money on buying a new car. Prices drop dramatically on a car when this happens.
What Are The Disadvantages Of Buying A New Car?
Even though buying a new car has its perks there can be a few disadvantages as well.
- You pay CO2 tax and Sales tax on the purchase of a new car.
- At first, when buying a new car, you will always owe more than what it’s worth. A car’s value can depreciate up to 30% within the first year of ownership.
- Insurance also costs more when purchasing a new car, because new cars are worth more.
- New models being released quite often means that car prices skyrocket each year and the general population’s income is not increasing at the same rate. This makes it impossible for many consumers to afford a new car.
What About Buying A Used Car Instead?
Pros Of Buying A Used Car
- The price of a used car could be much less.
- No extra taxes will be payable on the purchase of the used car.
- There will be lower finance costs.
- Insurance could cost less because the car is worth less money.
- You could still benefit on the balance of the manufacturer’s service and warranty on the car.
- You will have choice from a wider variety of vehicle models.
Cons Of Buying A Used Car
- The previous owner might not have disclosed all the defects with the car before selling it, even though under the new Consumer Protection Act they have to.
- If any mechanical or electronic problems occur, it could cost you a lot of money to repair the car if it is out of warranty and service plan.
- You cannot add any optional extras or safety features to the used car.
- You cannot be selective on the colour of car you want.
When buying a new car, it can be quite intimidating and can cause a lot of uncertainty. Always remember to do a lot of research and know what your budget is and to stay within that budget. Remember to also take the car for a test drive before you make a decision. Make sure that you sign up for affordable car insurance before you buy a new car.
Disclaimer:
This article was prepared by Eric Sandmann in his personal capacity. The views and opinions expressed in this article are the author’s own and do not reflect the views and opinions of Prime Meridian Direct (Pty) Ltd, FSP41040.The views and opinions in the article should not be attributed to anyone but the author unless expressly stated. Nothing in this article should be relied upon as advice, this publication is presented for informational purposes only. No person should act or refrain from acting in reliance on any information found in this article, without first obtaining proper financial advice from the appropriate professional. The author makes no claims, promises or guarantees about the accuracy, or completeness, of any information linked from, referred to, or contained in this article. The author reserves the right, to edit and change the content of this article.
Sources (referenced content is mixed within article, with no quotes are direct references):
1https://www.thebalance.com/buying-a-new-car-or-used-car-2385961
2https://www.cars.co.za/motoring_news/9-tips-buying-a-car-on-a-budget/44932/