Good way to break it down, makes sense given the miles you drive.Recently purchased a 2022 Yukon. Being in the military, we put a lot of miles on our vehicles and generally consider that we will wear them out before they age out of daily use.
Given this, when car shopping I generally subtract new price from resale value at the end of useful life (say 200k), then calculate per mileage depreciation. Good used value is anything substantially below the depreciation per mile. This is assuming the vehicle will wear out before age out. Could do this time-based too.
For our recent purchase, went like this: 70k new - 10k used @200k miles (conservative?)
That's $60k to depreciate over 200k miles. For a used model with 50k miles, 60/4=15k. It's burned through 15k of mileage based depreciation; thus, retail value should put it at 55k. A good deal to me for dealing with the uncertainties of buying used would be anything below 50k.
Those who have been tracking the used car market know that the past couple years have had insane valuations. Thus we made the decision to buy new.
Financing was 0 percent at the beginning of the year, so no cost to hold a larger loan ... in fact a better rate than used financing and no opportunity cost over purchasing with cash.
Additional factors for us were the body style changes on the recent Yukon giving more rear legroom and cargo space, plus the peace of mind with a new vehicle. Given that this purchase may last the entirety of our child-hauling years - it was the right choice for us.
Everyone's got legitimate reasons here. None of them sound like rationalizations for buying new cars and I have read some convoluted, tortured claims over the years.
So many I have wanted to scream: "Just say you like having the latest and newest at whatever cost and stop trying to convince yourself there's a good financial reason for your automotive debt load." No shame in that. Don't try to justify it. Just enjoy it.
I don't see that sort of nonsense with BITOG member posts.
Crap, all my drinking, tobacco, gambling, hobby and chasing money is tied up in cars and car stuff. But not new cars. Everyone has something they indulge. I probably spend too much on them. Could have bought a new car with what I've spent on what I have.
But: The idea of going into debt for a new car gives me the bloody vapors. I've had more fun, more value from my three than a new one would ever give me [done it, twice]. After the new wears off and the excitement levels off.... there are the years of debt ahead.
Not something I want. YMMV.