New Car vs. Used Car PDF

BUYING A NEW CAR Advantages Disadvantages WARRANTY: New cars typically come with a warranty that covers the cost of repairs and labor. Warranties vary with make and models. The average coverage is for 5 years or 50,000 miles, whichever comes first. DEPENDABILITY: When you buy a new car, you don’t...

BUYING A NEW CAR Advantages Disadvantages WARRANTY: New cars typically come with a warranty that covers the cost of repairs and labor. Warranties vary with make and models. The average coverage is for 5 years or 50,000 miles, whichever comes first. DEPENDABILITY: When you buy a new car, you don’t need to worry about unknown mechanical problems, previous wear, or body damage. HIGHER INSURANCE, TAXES & FEES: Taxes, and registration fees for a car are higher when the car is new. Also, used cars are generally less expensive to insure compared to a new car. CHOICE OF LATEST FEATURES & OPTIONS: With a new car you can have more flexibility to order a car with the features and options you want. INSTANT DEPRECIATION: Almost all cars depreciate but a new car depreciates the minute you buy it. A new car depreciates about 15% the day you drive it off the car dealer’s lot. HIGHER PRICE: The purchase price of a new car is higher than a used car. BUYING A USED CAR Advantages LOWER PRICE: Used cars have a lower purchase price and can be a much better value overall. When buying from private seller, one may have substantial savings when purchasing a used car. LESS DEPRECIATION: Though used cars continue to depreciate; they depreciate much slower than newer cars. Because depreciation is the loss of the value of a car, you may save a lot of money with buying a used car. LOWER INSURANCE, TAXES, AND FEES: It cost less to insure an older car, one of less value. Also, other fees and taxes are much lower. Disadvantages HIGHER LOAN INTEREST RATE: If you finance a used car, there is a higher interest rate than for a new car. Also, cars more than seven years old might not qualify for financing. LIMITED OR NO WARRANTY: If you purchase from a private seller, your car may not carry a warranty. A car dealer may or may not offer you a warranty on a used car. Extended warranties can be very expensive and are often not worth the cost. HIGHER MAINTENANCE COSTS: Because used cars have more miles on them than new cars, they are more likely to require repairs and maintenance. Depreciation is when the value of a car goes down due to wear and tear over time. Most all cars depreciate. If a car loses value (depreciates), you lose money, because it is worth less money. ©Career and Life Skills Lessons, All Rights Reserved. 5|P age Analysis New Car vs. Used Car Name___________________ Per._____ Date:___________ Directions: Using the charts showing the advantages and disadvantages with purchasing a used and a new car, answer the following questions. 1) Which type of car, used or new, depreciates the quickest? 2) How much does a new car depreciate as soon as you drive it of the car lot? 3) What does depreciation mean? 4) Which type of car, used or new, will mostly cost less to insure? 5) What are two advantages with buying a new car? 6) What are two advantages with buying a used car? 7) What are two disadvantages with buying a used car? 8) What are two disadvantages with buying a new car? Your Own Opinion 9. What type of car, used or new, do you think is best to purchase? Explain. ©Career and Life Skills Lessons, All Rights Reserved. 6|P age