ASK GARY: What is the true cost of a car?
What is the true cost of a car? The Toyota Parts blog has a good article up on its site that discusses this very issue. Check out the link below to read the article and my response to it or simply read my response below for some additional thoughts that should be considered when purchasing a vechicle.
While this article brings to light good points about the true cost of a vehicle, as the CEO of an automobile dealership, I’d like to point out some other factors to consider when figuring out how much a vehicle is costing you. First, is it more cost effective to buy a pre-owned or new vehicle? Many people look for pre-owned vehicles as an economical alternative to buying new. Is that right for you? That depends upon your budget. Determine how you are going to pay for the vehicle up front. Know your budget and where buying a vehicle fits into your monthly budget including maintenance costs. If you are financing the car, use an online calculator to determine what you can afford and how much you want to finance. Also look at your driving patterns and be well informed about the warranty packages offered to you to help you manage costs and budgeting. These programs can assist you in budgeting and managing overall out of pocket costs.
The next thing you should consider is the length of time you plan to have the vehicle. This is an important consideration in determining if buying a pre-owned vehicle makes sense for you. If you plan to own the vehicle for many years (eight plus years), buying a new vehicle may be a good alternative for you in terms of reliability and total cost of ownership over the long run.
Finally, once you buy a vehicle (new or pre-owned), ongoing maintenance is an important factor. If you want a newer-model (less than five years old), remember the maintenance and financing fees of buying pre-owned could cost more than new in the long run depending on your driving needs. Ask yourself: How many miles do you average in a year? What style and features are important to you? Be consistent about taking care of your vehicle; cutting corners in the short term can cost you especially in areas of the country where the seasonal changes are extreme. Also be consistent about where you take your vehicle for service. There is benefit in having the technicians know you and your vehicle as well as a real benefit of your having trust and confidence in the expertise of the service staff. Being conscious of these requirements and your driving habits will help you evaluate the cost and benefits of buying a new vehicle versus buying a pre-owned model with the features you want.