Article courtesy of GreenPath(TM), a partner of ECU, offering ECU members access to free and confidential financial wellness counselors and resources.
Learn more about GreenPath
Buying a car can be one of the most exciting decisions you will ever make and one of the most confusing.
How do you decide whether to buy a new or used car or whether you should purchase or lease it?
Consider the advantages and disadvantages of each option to decide what is best for you.
Should I Buy New or Used?
Some people buy used cars all of their lives and others prefer to buy new. It’s an individual choice based upon many factors. Below are some of the pros and cons of buying a new or buying a used car.
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New Car
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Used Car
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Advantages
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- You get the year, make, model, color and features you want
- You will have less concern with mechanical problems
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- You might not need a loan
- You’ll have lower insurance costs
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Disadvantages
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- Requires you to take out a loan
- You’ll have increased insurance costs
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- You’ll have an Increased risk of mechanical problems
- Your choices may be limited
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If you’ve decided on a new car, research your car choices, research your car prices and get pre-approved for a loan. If you are leaning towards a used car remember to research your car choices, get pre-approved for a loan, test drive the cars and negotiate the price.
Should I Buy or Lease the Car?
Another important decision is whether to buy or lease your vehicle. You might consider leasing a car instead of buying it with a loan. While buying a car makes you the owner, leasing is a way of obtaining a car for a set period of time without owning it.
Some of the considerations you should look at when deciding whether to buy or lease a car follow:
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Buying a Car
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Leasing a Car
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Advantages
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- You can keep the car for as long as you want
- You are not limited on the amount of miles you can drive
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- You might be able to drive a more expensive car than you could afford outright
- You won’t need a large down payment
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Disadvantages
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- You are required to pay the full price
- You will generally need a sizable down payment
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- Could be a costly option if you exceed the mileage limits or do not adequately maintain the car
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Are you looking for a strategy to use to decide whether to buy new or used or whether to buy or lease? As a member of ECU, you can take advantage of the GreenPath Financial Wellness program, a free financial education and counseling program. GreenPath counselors are available Monday through Thursday 8 a.m. to 10 p.m. (EST), Friday 8 a.m. to 7 p.m. and Saturday from 9 a.m. to 6 p.m. To use this service, simply call 1-877-337-3399 or visit them on the web at www.greenpath.com
