Maybe it’s your first time visiting a car lot as a would-be buyer, and you’re beaming with anticipation and nerves while taking this next big step in your life. Maybe it’s just time to upgrade to something fresh and new. Whatever the case, there’s one big question weighing on everyone’s mind: Do I buy new or used?

There’s no right answer to this question. Much of it depends on your personal situation. Here are a few key factors to help you make up your mind:


First, there’s the case of the warranty. Almost all new cars come with a built-in manufacturer’s warranty that’s good for three years or 60,000 miles. This is an invaluable benefit to buying a new car, as even the best-engineered machines sometimes break down. In addition to major repairs, some warranties cover routine maintenance, such as oil changes. If you have someone else covering the expenses for the first three years that could be money you’re saving. Since the warranty applies for three years, you can sometimes find recently used cars that still have the original manufacturer’s warranty.


Vehicle repairs come with the territory of car ownership, whether you’re buying new or used. No matter how well the car is made, some parts will wear out over time. While you can expect to pay more to maintain a used car than a new one, no one gets away completely free.

Given the possible expenses involved in repairs, buying a pre-owned vehicle can be a bit of a gamble. Of course, if you’re buying from a lot that’s connected to a trusted car dealer, it’s a pretty safe bet. Many lots inspect incoming cars and perform any necessary repairs or polishing. Buying from a used car specialist or looking for a vehicle on a site like Craigslist can be a bit more risky. It’s definitely cheaper, but you’re going into that deal with no idea what the past owner has done to the car.


Depreciation is a big concern when buying a vehicle. Depreciation is an asset’s loss of value over time. For all the reasons we’ve talked about and others, a car is worth less the longer it’s out of the factory. The biggest depreciation occurs immediately. Any car depreciates by approximately 11% of its original value as soon as it leaves the lot for the first time.

If you’re buying used, the loss that new car buyers experience is your gain. For starters, all that money now gone to the depreciation is money you save. The money’s already been lost by someone else; it’s not your problem!

Everyone has a different reason to decide whether to buy new or used. But if your goal going in is to save as much money as possible, there are some definite things you’ll want to keep in mind:

  • Am I willing to take the risk on the car surpassing its warranty?
  • Is it really worth losing so much money to depreciation?
  • Am I willing to pay extra for maintenance and repairs?

The more questions you ask, the more confident you can be in your decision to buy new or used. Take the extra step and go in with a pre-approval. It’ll allow you to negotiate from a place of confidence. Also, it’ll prevent you from falling in love with a car you can’t afford. If you’re thinking about investing in a new car, this is your month.

River City Federal Credit Union can get you pre-approved for your auto loan today! Apply online, in branch, or call (210) 244-2505.

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