1) The joy of year-old carsThe average new car is priced at just under £30,000. Yet by the time the clock has ticked over to 10,000 miles, the corresponding average value drops to around £21,000. That’s a decrease of 30%, on a car that’s still almost new! Thereafter, the rate of depreciation on average drops by a about half, meaning that, in most cases, getting a car that is roughly 12 months old will allow you to get the best value from it. The exceptions to this rule usually pertain to luxury cars, which tend to hold their value better over the first year. But depending on your budget and what you’re after, this may not matter anyway.
2) Have a checklistAsk yourself what you REALLY need from your next car, and compile it into a written checklist for you to use as a reference. For example, it could look something like this:
• Essential requirements? (eg: room for the family, a big boot, space for the car seat etc)
• Anything specific that I need? (eg: tow-bar for trailer, fitting into a small space etc)
• Short city drives or long motorway journeys? (eg: will it need to be able to cruise at high speeds, big engine or small engine needed etc)
• Petrol or diesel? (fuel preference and costs will affect the model that suits you)
• Green or non-green? (hybrids and electric cars will probably be more expensive initially, but may be eligible for grants from Government)
3) Sell your old one privatelyPart exchanges may be less of a hassle, but it is estimated that going down this route will see you miss out on up to 20% of the value of your old car. True, selling privately will mean you have to put in more effort, advertise the car, meet prospective buyers etc, but it will likely be worth your while. However, if you still decide to go for part exchange, beware of dealers inflating the value of your old car, only to charge you more on the new model. Remember, the difference between the two is all that matters.
4) Inspect it thoroughlyIf you aren’t much of a mechanic, make sure that when you view the car you are with someone who is. Someone that you can trust, too. A thorough once-over is arguably the most important thing to do when buying a used car, so make sure that you have absolutely every base covered. Here is a handy checklist, which should help your cause.
5) Be smart with financeThere’s a good chance that you might not have the necessary funds lying around to cover the cost of a new car. That’s okay, and you’ll be pleased to know that there are some excellent deals out there on car loans and car finance. Be sure to do your research, and find a rate and repayment structure that suits you. However, what you don’t want to do is skimp on your next car because you’re afraid to take out a loan. Remember, this is a long-term purchase that will serve you and your family for many years. Make sure you do it properly!
This is a sponsored post in conjunction with Lending Works.