Are you Paying more for Vehicle Ownership?
So far, 2014 has been a tough year for the dealerships. Significantly fewer vehicles have been sold in the first quarter of this year. Of course the manufacturers blame the weather. Thinking consumers blame the fact that many manufacturers have not been investing in new models, delaying the launch of redesigned vehicles until 2015. Many therefore prefer to wait and buy the newest models when they are released.
Because they will not depreciate as quickly as the old models. If you look at the infographic, you will see the speed new vehicles lose their value is one of the key factors in deciding the cost of owning a vehicle. Every day that passes sees a few dollars fall off the resale price of your pride and joy. If you buy new, you immediately lose any sales tax payable in your state, and then watch as up to 40% of the value drops out of sight in the first two years of ownership.
Of course some models lose less per year than others. The best way to calculate how much you are losing is to look at the trade guides to secondhand prices. These will give you a guide in percentage terms as to how much you will lose.
Now follow the infographic as a guide and look at the cost of car insurance and the interest you are paying on any auto loan or bank overdraft. Just because interest rates are low right now is not an excuse for ignoring the cost of borrowing.
Then come the running costs. How many miles per gallon does your pride and joy deliver? If it’s low, the cost of the guzzling will mount up to a hill of beans over the years you drive it. Just think how much you would save if you paid a little more and bought a model that delivers real gas economy.
Now think about the warranty. If you are proposing to keep the vehicle beyond the period of protection, how reliable is the model? Many repairs become necessary as vehicles age. The infographic also gives you the top five most expensive vehicles to own and the top five cheapest. That’s not likely to change so quickly, but if you are reading this late in 2014, you might want to check the latest lists before deciding what to buy. The careful buyer saves the most when calculating the cost of ownership.