Buying a Car, New or Used

Updated: August 12, 2025

When it's time to purchase your next car, you may ask yourself: Should I buy used or new? Along with choosing the make and model, determining your needs and wants, and examining your budget, deciding whether to buy new or used is another factor to consider. There are many options available in today's market. However, with planning and research, you'll be able to decide if buying a new or used car is the best option for you.

Whether you buy a new or used car, each option offers unique advantages and challenges. Here are some key considerations to help you make a decision that aligns with your financial needs and goals. 

Buying New 

Purchasing a new car remains an appealing choice for many. With current advancements, new vehicles often feature the latest safety options and entertainment features. These can range from convenience packages to environmentally friendly technology. Choosing to purchase a new car has many benefits. In most cases, shopping for a new car is easier because you don't have to research the individual car's history. After all, there are no previous owners. There's little to no mileage with a new car, and it's usually in perfect condition.

Purchasing new also opens more finance options for you. For example, most car dealerships have special incentives to entice you to buy a new car. Also, new car loans typically have better interest rates and terms. 

New cars offer the latest technology, style, and comforts. Usually, this technology is packaged together with other upgrades within the car. Ask if any dealer-installed options you do not want have been added to the car. These unwanted upgrades can add thousands of dollars to the final sale price.  

Another perk to choosing new is that your car may offer better gas mileage and lower emissions, saving you money and trips to the gas pump. Consider also the benefits of purchasing an electric or alternative fuel car; they have become increasingly reliable and cost-effective, with more charging stations available nationwide.

There are some drawbacks to consider with a new purchase.  Depreciation remains a reality, with the steepest drop occurring within the first two years. Insurance and annual vehicle taxes are frequently higher on new models because of their elevated replacement value.  

Although new car inventories have increased over the recent years, there is still a reduction in cars being delivered to dealerships.  You may have to wait a few weeks for the car to arrive to the dealer; this may require a deposit to hold the car. 

Buying Used

Buying a used car continues to offer meaningful financial benefits. Lower sticker prices, reduced insurance costs, and decreased annual taxes make pre-owned vehicles an attractive consideration for many buyers.  Thanks to milder depreciation, the resale value of a used car will be closer to your original purchase price over the next few years.

Certified pre-owned (CPO) programs remain popular, bridging the gap between affordability and reliability. CPO vehicles are inspected, refurbished and backed by limited warranties, giving you added confidence in your purchase.

Still, buying used has its considerations.  Even with expanded Carfax and title report access, some elements of a vehicle's history can remain unknown.  Especially how the previous owners cared for it and how it was driven. If you choose to purchase a used car, you may find yourself worrying about factors like reliability. The car you are buying may not be as reliable as a new one and may require more trips to the shop for repairs. 

Also, by opting for a used car, you may have to compromise on what you really want regarding the features, colors, and luxury options you desire. Your options may be limited, and you may have to shop around to find what you want. 

Do Your Research

A car is an important purchase, and you want to make sure you're making the best choice for you. Research is especially important if you're planning to purchase a used or new car. Here are some tips to get you started:   

• Figure out what you can afford. Knowing your budget and prequalifying for an auto loan can give you an advantage when negotiating a sales price.  
• Shop around — visit multiple car dealerships or search online.
  
• Review the car's history through online websites.
• Check the title. If you're buying from an individual and not a dealership, you want to make sure that they are the legal owner and can sell you the car.
• Have the car examined by a mechanic for any issues before purchasing it.
• Read reviews and ratings for the car you want to purchase. Look for what people liked and did not like about the car.
• Research MSRPs (Manufacturer Suggested Retail Price) and invoice prices to make sure that you are paying a fair price for the car.  
• Look into the cost of ownership for the car. The cost of fuel and insurance are just a couple of costs to consider. Foreign or luxury cars often come with a higher cost in terms of maintenance and repairs.
• Take it out for a test drive to get a feel for how it handles. Then, spend some time in the car adjusting seats, experimenting with controls, determining passengers' comfort, and if your cargo will fit.  

When looking for a new or new-to-you car, it's going to come down to whatever option brings you peace of mind. While a newer car may cost more, it does come with all the bells and whistles. On the other hand, you may find a more budget-friendly option by going with a used car. Decide your priorities and what choice is right for you, and be on your way to enjoying your new car.