Not sure whether a used car or a new car will save you more money? Here’s a price comparison of the two to see which one is really better value.
Upfront costs: Used
When it comes to saving money on upfront costs, you’re definitely much better off buying a used car. You won’t find any new cars cheaper than £6,000 in the UK – in fact, the cheapest currently is the Dacia Sandero at £6,995. This car doesn’t even come with air con or radio – something that a used car for £5,000 less is likely to come guaranteed with.
Of course, you can always lease a new car to save costs. The likes of this new Vauxhall Insignia comes with a rental upfront cost of just £1,500, so long as you’re willing to pay the monthly fees that come after. Leasing will cost you more in the long run, but if you’re just eager to save money on upfront costs it’s usually the way to go.
Used cars also win this round. Depreciation is the amount by which a car loses value over time. New cars can lose up to 40% of their initial value in the first three years. After this period cars tend to lose their value more slowly – as a result used cars which are older tend to depreciate less. In fact, there are some older cars that can end up becoming classics, resulting in them gaining value – just take the classic Mini Cooper S which has been steadily rising in value for the last decade.
Fuel efficiency: New
As a general rule, newer cars tend to be more fuel efficient than older cars. This is particularly the case with SUVs which have only recently started to become greener with many hybrids now on the market. If you’re looking to save money on fuel, you’re much better off buying a new car. There are of course some older cars out there with a fairly decent mileage such as the Honda Civic HB VX, but these are few and far between.
This one should come as no surprise – newer cars require much less maintenance than used cars. In fact, many used car buyers can end up paying more than the initial value of the car in repairs alone. This is simply because used cars have more worn parts and are more prone to needing to be fixed.
Insurance: It depends
If you’re wondering whether older cars or newer cars are cheaper to insure, unfortunately it’s not a clear cut answer. Whilst newer cars tend to come with higher insurance premiums due to the greater risk of being stolen, older used cars can have equally high insurance premiums if the car model has a bad history of car accidents. To save money on insurance, look out for older models with low cases of crashes. Of course, there are far more effective ways to save money on insurance.