Is It Worth Keeping An Old Car – Or Should You Buy a New One?
In this modern age, most people are quick to jump onto new trends and material upgrades. The act of purchasing new items instead of fixing and re-using old ones has become a hallmark trait of today’s society. But there may be more cons than pros to this approach to life. Especially, when you are asking is it worth keeping an old car vs buying a new.
When it comes to cars, there are many valid, practical reasons someone might want to swap their old model for a newer one. Perhaps it consumes more gas than you’d prefer, or there are fundamental maintenance issues that cost more than your kid’s annual school fees?
Whatever your incentive might be for showing interest in buying a new car, taking a moment to stop and think about whether it’s really worth it can save you a lot of time, money, and effort.
In fact, there is a strong argument for holding onto your old car instead of switching it out for a younger version. Old cars might be difficult to manage sometimes. But they are often less expensive to maintain in the long run.
There is also depreciation to consider. The rush of buying a new car doesn’t last long, and by that point, all you’re left with is a shiny hunk of metal that you’ll still be paying for well into retirement. Without further ado, let’s dive into nine different reasons you need to keep your old car.
9 Reasons You Need To Keep Your Old Vehicle!
1. Help Protect The Environment
One of the strongest arguments for keeping your old car is that it helps protect the environment. At such a crucial point in environmental history, many people are making lifestyle changes to slow the strain on our planet—and one way to do that is by holding onto your current car.
Despite the reputation that old cars have for having a high gas mileage, recent research has uncovered that buying a new car actually increases the amount of Co2 emissions released.
This is because even though newer, more environmentally friendly cars are designed to emit less carbon, the energy it takes to produce them far outweighs what the average old car emits in its lifetime.
If part of your reasoning for wanting a new car is because they are “greener” and more environmentally friendly, think again. Your old car produces significantly less Co2 than an electric one would, purely due to the process of development.
2. Omit The Indirect Costs Of A New Car Purchase
Sometimes, people forget about the many indirect costs that accompany a new car. When it comes to maintaining your personal finance, few of us can afford to take risks.
The auto insurance costs of a new car can be a lot weightier than your current car, even if it’s a similar model. In fact, the insurance premiums allocated to brand new cars in 2021 are 12% higher than they were just a year ago in 2020. This may be due to the impact of Covid-19, but the inflated costs are likely to stay.
If you want your bank account to stay in the green zone, it might be worth taking into account the high auto insurance costs that inevitably come alongside new car buying or leasing.
3. The Depreciation Of New Car
A common word you might hear in a conversation about new cars is “depreciation.” Depreciation is the gradual reduction of value that an asset accumulates over time, usually due to wear and tear.
No car owner can escape depreciation, no matter how beautiful the car is at the time of purchase. Pretty much everything decreases in value over time, but an old car already has most of its depreciation behind it.
A new vehicle, on the other hand, loses roughly 50% of its total car worth within a mere five years of purchase. Compare that with the car maintenance costs of your current car, and you’ve got a clear winner.
4. Save Money By Keeping The Car In The Family Line
If you’ve got children or younger relatives, keeping your old car in the family could prove extremely beneficial once they come of age to drive. Suppose you have a young person in your life that will need a car at some point, saving your old one for them can be extremely. If you or your elderly parents have a classic car, it can also become an heirloom that’s passed from generation to generation.
5. Learn New Car Maintenance Techniques
Regular maintenance needn’t be expensive or a hassle. Not everyone has a passion for car repairs and maintenance. But those that do could have an interest in keeping their old one around for the purpose of learning new car maintenance tips over the course of its life.
All that’s really necessary to get started is some basic mechanical knowledge and the desire to learn. Cultivating this sort of hobby can be fulfilling on a personal level, but it can also serve a very legitimate purpose. You’ll keep your car running and reduce the costs of any future repair bill.
Knowing how to replace windshield wipers, jumpstart your car, and do your own oil changes can save you from nasty repair costs later on down the line—and you’ll have gained a lifetime of car maintenance tips to apply to your next car.
6. No Need For Monthly Car Payments
There’s a lot we can say about the joy of being free from car payments each month. If you’ve ever experienced the relief that comes with finally paying off the car you’ve been driving for years, you’ll know it’s right up there with watching your hometown team beat their nemesis.
Instead of plunging straight into the next big car loan, consider what other valuable investments you can make with that money. You could start a college fund for your kids, start preparing for retirement or put aside the money for an emergency fund. Or you could invest it in a money market account and ensure you avoid bad credit in the future.
According to an approved loan calculator, the average monthly car loan cost in the US sits at a whopping $580. Just think about what you could do with all that auto loan money after saving for the next three to five years!
7. You Can Use Your Old Car For Collateral On A Financial Loan
Interestingly enough, your old car is potentially a major financial asset. More specifically, it can help you to qualify for a collateral loan, which is potentially life-changing in an emergency situation.
Within certain lending agreements, assets like cars can serve as a pledge that the loaner can use to secure the repayment of a loan. Major assets like stocks and homeownership can serve a similar purpose, but if you have neither of those, an old but functioning car is just as valid.
In such economically fraught times, everyone should be looking into fall-back options for the future, should their current income ever turn unstable. In this instance, keeping your old car can be the gift that keeps on giving. You can secure a loan based on the blue book or trade-in value of your car. Just make sure that you get fair pricing on any agreement and there are no exorbitant once-off loan registration fees.
8. Save Up For An Even Better Vehicle
With just a little bit of patience, you could soon be driving an even better car than the one you want to buy now. If you’ve only recently paid off your current car, why not focus on saving money for a new one?
Instead of signing off hundreds of dollars each month to a car dealership, invest money or set it aside in an interest-bearing account and wait to see how much you have in a few years’ time. You’ll come out the other side with not only the money you’ve saved but a significant amount of interest, too.
Holding onto what’s in your bank account now can seriously pay off if your current car is still in a drivable state. Choosing to drive an older Honda Accord for another few years will seem like nothing by the time you’ve made back its worth with money to spare.
Not only that, the older your car, the less auto insurance you’ll pay. This adds up to another saving, as just like life insurance and renters insurance, car insurance is a must-have expense. The total cost you save on insurance monthly can be added to your savings, significantly bolstering your future new car fund.
9. Good Old Nostalgia
There is something undoubtedly comforting about driving a car that has served as your main form of transport for the past few years (or longer). Assuming it is still in working condition, your car probably still has a lot to offer you in terms of practical and emotional value.
The chance of major repairs and the cost of keeping your old car running until a better solution presents itself are low, and chances are your finances are already getting tugged in numerous directions at once. Holding onto what you have now can add value to your life in the form of nostalgia, memories, and, of course, financial savings.
Making The Right Decision
When it comes down to it, nobody knows your situation or your car nearly as well as you do.
Perhaps you’ve got every desire to maintain your current old car, but there are practical issues that prevent this from being possible.
What’s important here is taking the time to analyze the pros and cons of buying or leasing a new car, and finding a sweet spot that works for you specifically.
Now that you know the argument for sticking with an older model, you can weigh up what it means to you and make a decision that is as informed as possible. Whether you drive an old car or a new one, just ensure that any safety concerns you have are alleviated with regular maintenance.
- Is It Worth Keeping An Old Car – Or Should You Buy a New One?
- 9 Reasons You Need To Keep Your Old Vehicle!
- 1. Help Protect The Environment
- 2. Omit The Indirect Costs Of A New Car Purchase
- 3. The Depreciation Of New Car
- 4. Save Money By Keeping The Car In The Family Line
- 5. Learn New Car Maintenance Techniques
- 6. No Need For Monthly Car Payments
- 7. You Can Use Your Old Car For Collateral On A Financial Loan
- 8. Save Up For An Even Better Vehicle
- 9. Good Old Nostalgia
- 9 Reasons You Need To Keep Your Old Vehicle!