Many consider gently used cars (2-4 years old) to be the ‘Goldilocks sweet spot’ of car buying: not too old, not too hot, but ‘just right.’ Here’s 10 reasons they think so.
1. You Miss the Biggest 2 Years of Depreciation
True, your car will keep on depreciating for a while, but the first two years are the worst two years. The first year alone can cost you 20% in depreciation.
2. You Still Pay Less in Taxes and Fees than on a New Car
Purchase price aside, the higher the car’s value, the more taxes and fees you’ll have to pay. Now that the car has taken the initial depreciation hit, taxes and fees will be significantly lower (although not as low as on a clunker).
3. You Still Get a Lot of New Gadgety Features
If you’re into all the fancy features that cars come with, you’ll be able to find 2-year-old cars with the same features as almost any brand new car. And buying the used car may get you the features you wouldn’t have been able to afford if you had gotten the new car.
4. You Get More Safety Features Than in an Older Car
If you buy an older clunker, you get airbags and seat-belts as far as safety features go. If you’re lucky, you get tire pressure monitoring. Buy a newer car, and you’re more likely to find a whole slew of artificially intelligent features, including traction control, automatic braking, pedestrian warnings, backup cameras, blind spot warnings, lane departure warnings, etc.
5. You Still Get a Few Years of Low Maintenance
The first 4 years of a car’s life are mostly maintenance free. Of course, still do your oil changes. Typically it’s not until 5 years and beyond that you start needing to replace wearable parts (tires are a big one around 6 years). And once you hit 10 years (or a little earlier if you’re a high mileage driver), prepare to start replacing everything under the
6. You Won’t Have Reliability Issues
Maintenance costs aside, a gently used car will still give you several years where you don’t have to worry about breakdowns or extended periods in the shop. Even the maintenance you’ll start doing between 7-10 years will typically only take a few hours in the shop. It’s not until the car has passed the decade mark that it’ll start having to spend the night with your mechanic.
7. You Often Still Get a Warranty
I would never recommend paying for an extra extended warranty. Typically, these are just moneymakers for a dealer. However, inheriting a manufacture’s warranty is always a nice cherry on top. A lot of cars extend the original warranty to the second owner of a car. Do be aware, however, that this second-hand warranty is often shorter than the original warranty. Nonetheless, it’s better than nothing.
If you do want the longer warranty, many Certified Pre-Owned cars come with a longer warranty than a regular used car. True, you’re paying extra. But in theory, the dealer has also done a more rigorous check up of the car.
8. Your Car Still Looks New
Park a freshly detailed 3-year-old car next to a brand new car and you probably won’t be able to tell the difference. Your car is still stylish and you’ve still got several years ahead of no rust.
9. If the Car Doesn’t Still Look New, You’ve Scored a Bargain
Don’t care about looks or the warranty? Shop for 2-3 year old cars that have been hail damaged! You’ll still get the gadgets and features and years of maintenance free driving, but for several thousand below market value. Some dealers specialize in these, or you can scan Craigslist for these.
10. You Might Have More Room For Negotiation
Sometimes dealers are sitting on a car that they really want to get rid of and are willing to offload for a significant discount. Typically, since dealers are better at predicting new car sales and have more control over their new car inventory, so you may have better luck finding a used car that a dealer is willing to sell for cheap.
A good indicator of a car like this is how long it’s been sitting on the dealer’s lot. Often you can find this info on the dealer’s website, or you can just periodically shop dealer lots. If it’s been there longer than most of the other vehicles on the lot, chances are the dealer will be willing to cut you a deal.
A dealer might also be itching to get rid of trade-ins that aren’t his brand. For example, a Ford dealer might be sitting on a Toyota trade-in. He doesn’t want to promote it super hard, because he’s undercutting his own brand then and his typical customer isn’t going to be shopping for a Toyota.
The only sure way to find a deal like this to make an offer. Finding a deal like this may take a lot of shopping and negotiating. You’re unlikely to get a deal like this on your first attempt. But if at first you don’t succeed, offer, negotiate and push some more. But be nice. The dealer is just trying to make a living, like everybody else.
While I do strive to only write accurate information and dispense valuable advice, I am not a licensed financial adviser. All information is based solely on my personal experience and personal research and should be treated as such. Find out more.