Why You Should Never Finance a Brand New Vehicle

If it is time for you to buy a new vehicle, this can be a really exciting time for you and your family. It can also be a very scary time as buying a new vehicle can be a huge expense. As you start to look at vehicles, you will be able to choose between brand new and used automobiles. You will also be faced with a million questions regarding financing and how you are going to pay for this vehicle. One of the most important things you can remember, especially if you are trying to make sure that you get a new deal, is that you should never finance a brand new vehicle. Here are a few reasons why you should stay away from financing a brand new vehicle:

You Don’t Truly Own It

When you finance a vehicle, you don’t truly own it. Not until it is paid off. This puts you at risk, especially if you are spending more to make sure you have something that is brand new. Remember, the car loses value almost the moment you drive it off the lot. If you have enough money to buy the car cash, then that is great, but most people don’t have that much money sitting around. Before you finance a vehicle, remember that you aren’t exactly buying it outright. This should also influence your decision on how much you can and should spend on your automobile.

It’s an Expense Not an Investment

One of the biggest misconceptions that people have about cars is they think that just because they are expensive like houses, that they are also an investment, like a house. This is not true. A house or a piece of property can be an investment. It can go up in value, and you can actually make money when you sell it. A car is not, not even a brand new car. Your car loses value every single time you drive it and put miles on it. You are not making an investment with a car, you will never get that money back. A car truly is just a big expense.

Your Money is Put Elsewhere

If you are stretching to come up with the money for your vehicle, this should be your first sign that you should not be buying a brand new car. Your money can do much more somewhere else. Even if you buy a used car, you can end up saving a few extra thousand dollars, money that you can put into an account and that you can invest in. You have the opportunity to make your money work for you in better ways and to put your money into something else that will actually make money, instead of losing your money by putting more into financing a car. Your salesman may try to convince you that by financing you aren’t losing any money, but in reality, you are still paying interest and you are still not making the best decision about what to do with your money.