Will a Used Car Always Cost Less Than a New Car?

Everyone knows a pre-owned vehicle costs less money up front than a new one, but you may wonder whether the initial low cost is worth it in the long run.

Used cars typically cost more to repair each year than a new one, which may be under warranty, and used car loans typically have a higher APR than new car financing. Used cars usually get fewer miles per gallon, too.

Bank of America went through the blow-by-blow on every factor to consider when budgeting a car over the course of five years, and in most circumstances, the checkbook balances in favor of used.

In 2015, the average new car shopper spent $13,000 more than the price of an average used car -- and the majority of those used vehicles were less than 3 years old. New cars depreciate rapidly in monetary value, but are still highly reliable in most cases. Check the CARFAX vehicle history reports available for most of our used inventory to get a better idea of how well a vehicle was maintained.

Used cars are also less expensive to insure, and despite a higher APR, almost always cost less to finance because of their lower starting price. In the example used in the video, the used car saved its owner over $7,000 over the course of five years compared to buying new.

Learn more about costs and benefits of a used vehicle at GMT Auto Sales in Florissant, MO.