It is funny how disillusioned we Indians are about our cars. Cars somehow got to a level of signifying our status. I was there too, It is just a car. Cars help you get from one place to the other, say to your work, an airport run, a get together etc., not something to flaunt.
Thanks to the advertisements that have made us believe new is better while making most of us debt-ridden. Of the many things that can be bought used, cars definitely top the list with their many benefits. Yes, new cars come with their fair share of benefits, a monthly payment, a fat tax and a hefty insurance bill.
Let alone the chance of getting a “Lemon Car”, if you get one then you will end up paying more on maintaining it. It is almost impossible to look for timely help from Consumer Protection to save our fannies.
On the other hand, buying a used car would save you a bunch of money with its low cost, tax rates, insurance and no monthly payments. Buying a used car also means it has been tried, tested and proven durable.
Believe it or not, you would have saved lakhs right from the day you bought it, while your brand new ride lost value the moment you drove it off the dealer’s lot. There is more to this than meets the eye.
Used cars attract only half the price of a brand new car, especially if you are shopping around for a car that is around 4-5 years old.
If you are looking for a car that is as-good-as new (2-3 years old), you would get it about 25-30%, minus tax and still avoid the maximum depreciation period. A brand new car loses 20% the moment you drive it off the dealership.
Petrol can be driven for 15 years as opposed to 10 years for diesels. The older the car the more money you get to keep with you.
Check the price of the new car, you saved up so long, to buy. Now go to a used car dealership like Galaxy Cars and check the price of the same car. It is guaranteed to be 30-60% cheaper for about half the tax and insurance.
This gives you the opportunity to move a segment or two above the new car your money could buy. If you saved up for a hatch you could now look at a sedan or a crossover. Upgrade for free.
I have experienced both, being least bothered about monthly payments with the used, and having to leave a chunk of cash every month in the bank for installments on the new one. Loans attract an additional burden and are considered bad financial planning.
I can’t repeat it enough, as if new cars weren’t as expensive as they already are the percentage of interest ranges between 8.5-10% PA with a tenure of 12-36 months or up to 7 years in some banks. You will end up paying 10-15% more than the cars actual value.
Low Insurance Cost
Used cars attract lesser insurance costs as they tend to lose about 50% of their value by the fourth year. You will only be paying half the insurance premium if you bought a four-year-old car with over 60-70% of its drivable life left. New vehicle buyers have to buy insurance for three years.
There is no denying the fact that some cars made in a specific year or with a type of engine last longer than their new or upgraded counterparts.
Some models even have a feature or two unique starting from a particular color to a year’s model. Shopping in the used market opens a world of variety in segment, specs, trims, models, colors, etc.
You could even find a well-maintained vintage car, if that is your style. New cars often lack such variety as they come in 3-5 trims excluding engine options. The used car may still have the feature you most loved about it that isn’t available on the new one anymore.