Should You Buy a New or Used Car

Summary

In this video, Greg, the 'Car Angel,' explains why buying a used car is financially smarter than a new one. He illustrates that most car depreciation occurs in the first few years, with repair costs increasing exponentially over time. The 'sweet spot' for buying a used car is between the second year and the eighth year, or 24,000 to 96,000 miles, offering the best balance of price and maintenance. Greg's website, carbuyingsupport.com, offers guidance on purchasing high-quality used cars in this optimal range.

Takeaways

• 🚗 The best choice for a car is often a used one, according to Greg, the 'Car Angel'.
• 📉 Depreciation is steepest in the first few years of a car's life, leveling off as it ages.
• 🔧 Repair costs are low for new cars but increase exponentially over time.
• 💰 The 'sweet spot' for buying a used car is between the second year and the eighth year of the car's life, or 24,000 to 96,000 miles.
• 🏞 Cars are built to last, making it financially wise to buy within the sweet spot for optimal value and maintenance costs.
• 💡 Buying a new car is often chosen for the perceived low risk, but financially it's not the best move.
• 🌟 Greg's website, carbuyingsupport.com, offers guidance on how to buy a high-quality used car in the sweet spot.
• 🛠 The sweet spot is ideal because it balances lower depreciation with manageable repair costs.
• 👤 Most people opt for new cars due to the lack of immediate repair costs, but this overlooks long-term value.
• 📈 Greg illustrates the financial benefits of buying a used car with a graph showing depreciation and repair costs over time.

Q & A

What is the main topic of Greg's video?

The main topic of Greg's video is determining whether it's better to buy a new or used car, with a focus on why a used car is often the best choice.

What does Greg's graph represent?

Greg's graph represents the relationship between the age of a car and its value (depicted as a line for money) and the age of the car.

How many miles per year does Greg assume in his analysis?

Greg assumes that a car is driven 12,000 miles per year in his analysis.

What is the significance of the first few years of a car's life according to Greg?

According to Greg, most of the depreciation in a car happens in the first few years, after which the depreciation evens out.

Why does Greg suggest that buying a new car might not be the best financial move?

Greg suggests that buying a new car involves heavy depreciation in the beginning with little repair cost, which is not the best financially because you lose a lot of money in the initial years.

What is the term Greg uses to describe the optimal time to buy a used car?

Greg uses the term 'sweet spot' to describe the optimal time to buy a used car.

What is the duration of the sweet spot according to Greg's video?

The sweet spot occurs between the second year and the eighth year of a car's life, which translates to between 24,000 and 96,000 miles driven annually.

Why is the sweet spot considered the best financial choice for buying a car?

The sweet spot is considered the best financial choice because it offers the best price for the car with the least amount of maintenance required during ownership.

What advice does Greg give about the risk involved in buying a new car?

Greg advises that while buying a new car involves very little risk in terms of repair costs, it is not the best financial move due to the high depreciation costs.

What resource does Greg offer to help viewers buy a high-quality used car?

Greg offers guidance on his website, carbuyingsupport.com, where he teaches viewers how to successfully buy a high-quality used car in the sweet spot for the best value.

What is Greg's role as the 'car angel'?

As the 'car angel', Greg's role is to provide advice and guidance to help people make informed decisions when purchasing a car, particularly focusing on the financial benefits of buying a used car in the sweet spot.

Outlines

00:00

🚗 Why Used Cars Are the Best Choice

Greg, the 'car angel', discusses the financial benefits of buying a used car over a new one. He uses a graph to illustrate how depreciation is most significant in the first few years of a car's life, after which the value drops more gradually. He also points out that new cars have lower initial repair costs, but these increase exponentially over time. Greg introduces the concept of the 'sweet spot' for buying used cars, which is between the second and eighth year of the car's life, or 24,000 to 96,000 miles. He argues that during this period, the car offers the best value for money due to lower purchase cost and manageable maintenance expenses. Greg encourages viewers to visit his website, carbuyingsupport.com, to learn more about buying a high-quality used car in this optimal price and maintenance range.

Keywords

💡Depreciation

Depreciation refers to the loss in value of an asset over time, due to use, wear and tear, or obsolescence. In the context of the video, it specifically addresses how a new car's value decreases significantly in the first few years of ownership and then at a slower rate as it ages. The script illustrates this by showing a graph where the line representing the car's value drops sharply initially and then levels off.

💡Repair Costs

Repair costs are the expenses incurred to fix or maintain a vehicle. The video script explains that new cars typically have low repair costs initially due to their freshness off the assembly line, but these costs increase exponentially over time. This is depicted in the video as the green line starting low and then rising sharply as the car ages.

💡Sweet Spot

The 'sweet spot' in the video refers to the optimal time frame for purchasing a used car, which balances lower depreciation with manageable repair costs. It is defined as the period between the second year and the eighth year of a car's life, or 24,000 to 96,000 miles, where the car offers the best value for money. This concept is central to the video's message about making a financially smart decision when buying a car.

💡Car Angel

Greg refers to himself as the 'Car Angel,' which is a playful and friendly way to position himself as a guide or advisor for car buyers. This term is used to establish a personal brand and to create a connection with the audience, suggesting that he is there to help and protect them from making poor car purchasing decisions.

💡Miles per Year

Miles per year is a measure of how much a car is driven annually. The script assumes 12,000 miles per year to calculate the car's age and depreciation. This figure is crucial for determining the car's condition and value, as well as the expected repair costs over time.

💡New Car

A new car, as discussed in the video, is a vehicle fresh from the manufacturer and has not been previously owned. The video contrasts the high initial depreciation and low repair costs of new cars with those of used cars, suggesting that buying new might not always be the best financial decision.

💡Used Car

A used car is a vehicle that has been owned and driven by someone else before. The video advocates for buying used cars, particularly those within the 'sweet spot,' as they offer a better balance between lower depreciation and manageable repair costs, making them a financially wise choice.

💡Financial Choice

Financial choice, in the context of the video, pertains to the decision-making process when purchasing a car with an emphasis on cost-effectiveness. The video suggests that choosing a used car in the 'sweet spot' is the best financial choice due to its lower overall cost of ownership.

💡Car Buying Support

Car Buying Support is mentioned as a website where Greg provides resources to help viewers buy high-quality used cars. This term represents the practical assistance offered beyond the video, guiding viewers to make informed car purchasing decisions.

💡Risk

Risk, as used in the video, refers to the potential for loss or damage, particularly in the context of car ownership. New cars are said to have less risk initially due to lower repair costs, but the video argues that the risk of high depreciation outweighs this benefit, making used cars in the 'sweet spot' a preferable choice.

💡Ownership

Ownership in the video refers to the period during which a person owns and is responsible for a car. The discussion of depreciation and repair costs is tied to the concept of ownership, as these costs are experienced and managed by the car's owner over time.

Highlights

A used car is often the best choice for car buyers.

Depreciation of a car happens most rapidly in the first few years.

After the initial years, depreciation slows down as the car ages.

New cars have low repair costs in the first few years.

Repair costs increase exponentially as the car gets older.

The 'sweet spot' for buying a used car is between the second and eighth year of the car's age.

The sweet spot corresponds to 24,000 to 96,000 miles driven per year.

Cars are built to last, making the sweet spot a financially smart choice.

Buying a car in the sweet spot offers the best balance between price and maintenance.

Most people buy new cars due to the perceived low risk.

The best financial move is to buy a used car in the sweet spot.

Greg's website, carbuyingsupport.com, teaches how to buy high-quality used cars.

The website provides guidance on buying from private parties or dealers.

Greg offers tips to get the best car at the best price and experience.

The video aims to educate viewers on smart car buying strategies.

Greg is referred to as the 'car angel', guiding viewers through the car buying process.

Transcripts

hi I'm Greg your car angel which is the

better choice a new or used car in this

video I'll be showing you why a used car

is really the best choice so in this

graph that I'm drawing for you this line

represents your money and this line

represents the age of the car beginning

when new and when it's two four six

eight and ten years old so now of these

years I'm assuming twelve thousand miles

per year all right okay so that is how

many miles are being driven per year if

you were to buy the car new here you'll

find that most of the depreciation in

the car happens pretty much in the first

couple of years and it evens out as the

car ages in other words you will lose

most of your money on a car's value in

the first few years and as the years

progress you're going to have less and

less depreciation between individual

years money that you lose and

depreciation is here in the first few

years you will also on the other side by

buying a new car have very little repair

cost if any in the first few years so

that's why I begin it down here okay so

here the green being your repair cost

are low at the beginning and they start

going up over time exponentially okay so

now you have your depreciation

and you have your repair costs so the

question is should you buy new and have

the heavy depreciation in the beginning

but have very little repair cost or buy

a car that has had a lot of depreciation

that's occurred and risk the repair cost

and the answer to that is what I call

the sweet spot and the sweet spot occurs

at about the second year and goes to the

eighth year and that would if you're

putting on twelve thousand miles a year

that would be between twenty four

thousand and ninety six thousand miles

and this sweet spot is what I consider

the best financial choice to own a car

cars are built so well these days that

the sweet spot is at twenty four

thousand two ninety six thousand miles

so this scenario you're going to get the

best possibility of getting the car for

the best price with the least amount of

maintenance during your ownership most

people buy a new car because there's

very little risk involved in other words

there's no repair cost but the best

financial move is really to get into

this sweet spot right here and what I

have done at my website car buying

support calm is to show you how to

successfully buy a high quality used car

in the sweet spot for the best money

whether you're buying from a private

party or a dealer so I encourage you to

go to that site and I will teach you

exactly how to get the best car at the

best price with the best experience I'm

Greg your car angel thanks for watching

I'll see you in the next video