1. Value Depreciation
The value of a new car drops swiftly in its first few years of life, often by as much as 40%. This makes it a poor long-term investment, meaning that the second person to buy it actually gets a better deal than the one who drives it home straight from the dealer.
2. Lowered Prices
In many cases, a large portion of the price tag for new vehicles comes simply from the fact that they’re new. Wait a few years, and the prices on these same vehicles will lower considerably, even for cars that have experienced little or no wear. Lowered prices aren’t necessarily a sign that the vehicle has been through an accident—they likely only mean that newer models have come out recently, driving the cost down.
3. Sales Tax
In many states, sales tax can be steep for new vehicles. Used ones, however, often have little or no sales tax. One of the first steps you should take before making a decision is to research your state’s laws and make sure that your new car won’t cost you thousands more in tax dollars than a slightly used one would.