Fast forward 12 months and that car will lose around 20% of its value from the day you bought it. If you buy a $35,000 shiny new car, that car loses somewhere between 9-11% of its value the moment you drive off the lot. 3Most cars lose about 10% of their value every year after that steep first-year dip. You’re basically throwing $3,500 out the car window as you drive the car home for the first time!Īfter One Year: Fast-forward 12 months and that car sitting in your driveway will have lost around 20% or maybe even more of its value from the day you bought it.Īfter Five Years: You can expect your new car to lose 60% of its value after driving it around for five years. It’s going to be a bumpy ride! Here’s a look at how quickly a new car loses its value:Īfter One Minute: If you buy a shiny new $35,000 car, it loses somewhere between 9–11% of its value the moment you drive off the lot. Just how fast do new cars lose their value? Buckle up. But they all lose their value over time-especially new ones. Depending on the make and model, some cars might hold their value a little better than others. That loss in value is called “depreciation,” and it’s a fact of life.īut here’s the kicker when it comes to car depreciation: New cars lose their value at a much faster rate than used cars do. Whether you have a car, a boat or a lawnmower, they all go down in value over time as they go through the wear and tear of everyday use. It all depends on the type of car you’re looking at and how long the car has been on the road. So just keep in mind when you’re car shopping that new doesn’t automatically equal safe. 1 From faulty air conditioners to troublesome transmissions, many drivers of newer model cars end up making constant trips to the mechanic or getting manufacture recall notices in the mail. In fact, some newer cars (especially models in their first year of production) are among the least reliable cars you can drive. You can find like-new used cars that are just as safe and dependable as a new car-and at a much cheaper price. And one of the most common arguments against buying a used car is that it’ll wear out sooner and won’t be as reliable as the new ones rolling straight off the assembly line (this feels especially convincing if you're buying one for your kid).īut the truth is that despite all the claims from your friends and neighbors to the contrary, you can find like-new used cars that are just as safe and dependable as a new car-and at a much cheaper price. “You won’t have to worry about repairs or maintenance,” they said.įirst, safety is always a concern. The choice between a new or used vehicle (and how you pay for it) could be the difference between riding the highway to wealth and financial independence or spinning your wheels in a rut of debt and endless payments.īut if that new car smell has given you a serious case of car fever, the only prescription is cold, hard numbers. Don't let car insurance costs get you down! Download our checklist for easy ways to save.
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