I would like to know how often should I change my car. If I will buy a new car it would be a bad investment ? If I decide to buy a car, for how long should I keep it so that I won`t lose a lot of money ? I would like to know more about this as I have a neighbor that keeps changing his cars probably once an year or so. What`s the catch ? I am not a rich person but I would lie if I would say that I am poor, just a regular person.
Great question and I`ll try to explain this as best as I can. First of all let`s talk about new cars and second hand/used cars. I will also try to explain why the new cars are usually a bad investment if you can`t afford them.
New cars: the great thing about new cars is the new car smell. You`re the first person that touches everything, there are no scratches, everything inside and outside looks like new, no rust, dents, accidents, no hidden km or any bad history. Not to mention the guarantee that your car comes with and this means: no headaches, forget about going to service for repairing something and so on. It seems that there are a lot of advantages right ?
The disadvantage: Well, the main problem with a new car if you`re thinking at your money is the great loss of value around 40 % in the first year. Other minor issues would be a new scratch or a minor accident which would probably drive you crazy, sure we all want to keep our things as new and good looking as possible, don`t we ?
Used cars ( second hand ): If you will buy an used car and you`re going to get a popular model you`re going to increase your chances for a fast resale and at a good price. You won`t lose that much when compared with a new car. Sure, probably you`re going to change some parts but if we`re talking about components such as brakes or fluids you will probably pay less when compared with a dealer ( a new car will have to visit the dealer on a time or a limit of km otherwise you will lose the warranty ). You could also experience cheap prices if you have a friend who`s a mechanic or something like that. A small scratch won`t stress you that much, in fact you didn`t paid for a new car and it was cheaper than a new car.
The disadvantage: You have to be very careful when you purchase an used car. The engine must run properly. If the engine or the gearbox is seriously damaged it`s going to cost you so much money that will probably double the price paid on this car ( it happened to me once ). A cheaper car other than normal price of the market is usually a good sign: ``if it`s too good to be true, it probably is`` and if you still don`t get it - it`s a scam or a damaged car.
Now, regarding the first question: ``how often should I change my car ?`` I`ve made a picture which is a representation of a new car compared with a used one. It is a picture that presents a depreciation for both new and used cars/vehicles when we`re talking about two identical brands and models.
As you can notice from this picture, if you`re going to buy a new car and sell it in the first year you will lose 30-40 % from her initial price. You will continue to lose money as the car gets older but if you will decide to sell it after a couple of years you will obtain the same or a better value when compared with a similar car, exactly the same car brand, model and a better looking car with only 1 owner.
Sure, if you`re looking from a financial perspective buying a brand new car will be a bad deal for you as you`re losing the 30-40 % value from the first year while at a second hand car that loss doesn`t exist at a given time and date.
One other thing is the car warranty ( guarantee ), if you`re lucky enough to buy an used car with a warranty left for let`s say 1-2 years it`s great. So, how often do you change your car ? I am changing my car when I have money for a new vehicle or should I say after I am checking my savings and see if I can afford a new car. If there are other priorities and the current car is working well I would keep it for a longer period although I acknowledge that I will lose more money. I was talking about me, so you have to take a decision based on your status.
It depends a lot on how much money you have, how do you appreciate things in your life, what kind of a person you are, do you consider a car an investment ? and so on there are a lot of things.If you would lose your job tomorrow would you be able to afford a new, recently purchased car ? Sure, nobody wants to lose his job but you need to consider every scenario. I am telling you this because it happened to me exactly when I purchased a new car. Luckily I had a strategy which allowed me to get a new job in several months.
If happiness is all what matters for you and you want a car so badly, forget about the math and economy and buy a new car.If you don`t want to lose money, then go on and buy used cars and change them frequently and there is a good chance that you won`t lose money or at least not a significant amount. Probably you should keep a car between 3 months and maximum 1 year. Sure you will have to take a good care of it so that you can obtain as much money as possible when you will sell it.
If you fell in love with your car you`re probably going to keep it for decades and nothing else doesn`t seems to be logical. That`s why we`re seeing persons driving the same car after 20 or 30 years.As you can see there is no such thing as a single answer to this question and that`s why my father has a car with over 500.000 km in less than 6 years, an old man drives a 30 years old Porsche, that`s why a friend of mine keeps changing his cars and finally that`s why some rich people keeps buying brand new cars. After all, it depends on a lot of things.