Cutting Car Depreciation Costs

    Posted by Ben Davidson about 2 months ago

    Cars are one of the most valuable possessions we own. Most of us have to save or take out a finance agreement to buy one, which is fine because they are useful, lots of fun, and often necessary. However, it can be a bit of a bummer to find that the car you’ve just bought is already worth far less than it was just a minute ago.


    Did you know that the average new car will lost 25 percent of its value the second you drive it off the lot or that it could be worth as much as 40 percent less than you paid for it 12 months on? It’s a shocking fact that most car owners won’t be happy to hear, but all is not lost - there are some things you can do to cut the level at which your vehicle depreciates...


    Buy a Used Car


    It’s pretty obvious that if you buy a used car, you won’t see it depreciate as far as a new car. Used cars have already lost a lot of their resale value, which means that you can spend less on acquiring them and that they will hold their value far better, if you look after them than new cars. If you’re smart, you can find high-quality used cars for sale under $25,000, which have barely been driven, and you could make an absolute steal. It’s definitely the smart thing to do.


    Buy a Cheaper Car


    If you don’t want to buy a used car, buy a cheaper one. Sure, it’ll probably still depreciate at the same rate, but at least the actual dollar amount you’ll be losing will be lower, and that will mean less of your money will have been effectively “wasted.”


    Buy an Ex-Lease Car


    Buying an ex-lease car that is just one or two years old is one way to get the best of both worlds. You get to own a relatively new and shiny vehicle, without having to pay the depreciation costs because the first owner will have paid for those. It’s easier than you might think to pick up relatively new cars in this way and it could just be the smartest thing you’ll ever do.


    Take Good Care of Your Car


    You can’t avoid your car depreciating in value completely, but if you look after it, carrying out regular maintenance before bigger problems rear their head, you can hold on to more of the value than you would if your car was poorly maintained. Well looked after cars are always more attractive to buyers for obvious reasons, so use that to your advantage.


    Buy a Car You Love


    Finally, when you come to buy a new car, make a real effort to choose a vehicle that you love, and which will meet your needs now and in the future. That way, even if your vehicle does depreciate in value significantly, it won’t really affect you too much because you’ll love it and use it for longer and its value won’t be of much importance to you.


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