If you have gone car shopping recently, you may have experienced sticker shock like many other Americans due to today’s incredibly high prices for both new and used vehicles. According to Kelley Blue Book, the average new car price today is about $47,401, which is nearly double what it was just 12 years ago. These increases are leading more consumers to keep older vehicles longer to avoid hefty down payments and expensive monthly payments. Here are some things to keep in mind as you navigate the car buying process in this new pricey market.
Consider keeping your current car longer than you might have originally wanted
While vehicle prices continue to rise, so does reliability and longevity making these investments a little less difficult to swallow. While some people still go by the old rule of thumb of trading in your car when you hit 100,000 miles, Consumer Reports states that a modern car from a brand known for reliability should be capable of 200,000 miles or more. A reasonable lifespan for a modern car is therefore much longer than before due to advancements in automotive technology, proper maintenance and good driving habits.
Rather than waiting until your car breaks down or you see a warning light, it’s important to do preventative maintenance like oil changes, cabin- and air-filter replacement, battery cleaning, wiper-blade replacement and headlights checks periodically. Additionally, with lower mileage and less wear and tear on vehicles today due to a nationwide transition to hybrid and remote work, many vehicles aren’t racking up nearly as many miles today as they were pre-pandemic.
Think through all factors to make a smart financial decision
With so many different vehicles on the market today that offer a range of amenities, there are lots of factors to consider when making the decision to purchase a vehicle. If you are interested in an EV, there are some tax incentives that might help make your decision an easier one. For gas-powered cars, you may want to consider one that is known for reliability and longevity, and these retain their value much longer than others. You will also want to think about your driving habits and how much time you expect to be in your vehicle as gas prices continue to rise and the cost of filling up your tank may be something to consider.
Research your trade-in value
Trading in your current vehicle can significantly offset the cost of your new car, making it an essential part of the car-buying process. However, to maximize the value you get from your trade-in, you’ll want to do your homework. Check reputable online tools like Kelley Blue Book, CarMax, Carvana, and Edmunds to estimate your car’s trade-in value and compare values from at least a few of these platforms. Make sure to be honest about your car’s condition when using the valuation tools and don’t settle for the first trade-in offer you get.
Weigh the pros and cons of purchasing a new or used vehicle
You have likely heard that new cars lose their value as soon as they are driven off the lot and this continues to be true, although the loss in value isn’t quite as staggering as it once was. Also, given that inventory of used cars is lower due to many people holding onto vehicles longer, the price of used cars vs. new cars may not be as extreme as it once was. If you’re interested in a used car, you may want to consider a certified pre-owned vehicle as they typically have better warranties and are in better mechanical shape due to a more rigorous inspection process.
Buying a car in a pricey market requires careful planning, research, and patience. By setting a realistic budget, exploring all your options of both used and new vehicles, researching your trade-in value, and negotiating wisely, you can navigate the high-cost market and find a vehicle that meets your needs. Remember, the goal is to make a purchase that aligns with your financial situation and long-term goals.
Review your car insurance policy thoroughly
Once you make the decision to purchase a new car, you’ll want to review your car insurance thoroughly to make sure you’re covered. Reviewing your policy with a trusted attorney like the North Shore Injury LawyerMark T. Freeley is a great way to ensure you understand your options as best as possible. With over 30 years of experience fighting insurance companies on behalf of his clients, Mark is ready to help. If you have any questions about your car insurance policy, give him a call at 631-495-9435 he will happily guide you through the choices, for free.