Old Car vs New Car – Long Term Cost, Safety, Reliability, Appearance

I don’t have a PhD in something money-related, but I have common sense and experience owning and working with cars on a daily basis. Here’s my two cents (well, hopefully you can save a bit more than two cents) on keeping your old car or purchasing an old car vs going with a brand new or newer used car.

Safety First

You can make more money, and you can always buy another car, but you can’t replace a human life, so safety is a top priority in a car purchase.

Unfortunately, this is also the most complex aspect of the whole new car vs old car discussion. The newer the car, the better the safety technology.

Side curtain air bags, crumple zones, etc. are very helpful in many types of accidents, while older vehicles (for example, those that use body-on-frame construction) might fare better in other times of crashes.

It’s important to consider that a newer car will sustain more damage, even in small accidents, while an older vehicle of similar type and size might get damaged less, though the occupants will feel the accident more.

Here’s why – the more force the car absorbs, the less hurt you’ll be. From a strictly safety perspective, you should always buy the newest car, right? Well, not necessarily, because the whole newer car vs older car thing is only meaningful within the same class of vehicles. A sub-compact with five-star safety ratings might not be as safe in most situations as a mid-size car with four-star safety ratings, and if you buy a slightly older vehicle, you can get a higher quality, slightly larger vehicle for the same price or cheaper.

For example, in an offset head-on collision at highway speeds, such as a drunk driver drifting across the double-yellow line and hitting you, would you rather be in a 2008 Chevrolet Suburban, or a 2016 Toyota Yaris? I know that’s an unfair comparison in many ways, but assuming the accident is unavoidable, I’d much rather be in the Suburban.

If we take the same offset head-on collision at highway speeds with two Honda Accords, a 1999 and a 2017, of course I’d much rather be in the 2017, as modern safety standards and technology could mean the difference between death and walking away from that crash.

As you can see this is a complex subject, but in conclusion a car that’s a few years older but a class larger than a new smaller car is a safer bet. For example, instead of a compact sedan, you could get a mid-size sedan. You might lose a few MPG, but you gain some practicality, ride quality, and perhaps reliability – more on that later.

Money Money Money

For many people, the biggest factor in what they drive is money. Financially, it’s clear that an older vehicle is cheaper, in practically every way except for unexpected repair costs.

Let’s look a few examples. First, a Hyundai Elantra. MSRP of a new 2017 Elantra is about $21,000, while I found a great condition clean title 2010 Elantra with about 100K miles for less than $5,000 on Craigslist. Assuming a $5,000 down payment on a 5 year loan on a new $21,000 vehicle with 9% tax rate and 4% APR, your monthly payment would be a bit under $300 on the new car.

On top of the payment, you would need comprehensive insurance on the new vehicle, while on the owned used vehicle cheaper liability insurance is an option. Since insurance rates are so variable, I’m not going to discuss full-coverage vs minimum liability, but the difference would probably be, at a minimum, several hundred bucks a year for most people – more if, like me, you’re a male in your early 20s.

So, a $300 monthly payment over the course of a year is $3,600. On your used Elantra, best case, you don’t have any unexpected repairs beyond regular maintenance, so you save $3,600 in a single year. Even if you have an expensive repair, such as replacement of the automatic transmission or the whole engine, that would most likely cost  less… but then you don’t have to worry about that for another 5-10 years.

Do you see why the used car is so much cheaper? And, again, I’m not even including insurance in the savings. I’m also assuming regular maintenance costs the same on the new car and the older car, which isn’t really true, either – things like tires, brake pads, oil changes, air filters, etc. are almost always less expensive, especially for common cars.

Now, if you are going to finance your used car, and not buy it outright in cash, it gets a bit more complicated. New cars often have far better interest rates than used cars, and the way some vehicles hold their value, a new one can be almost the same price as a used one.

Outside of the price of the car, the only obvious disadvantage to the older car is fuel economy. If we stick to our Elantra comparison, The 2017 Elantra gets about 3MPG better than the 2010. But according to fueleconomy.gov, that’s only a $750 difference over the course of 5 years. That’s a measly $150/yr.

Let’s run another example – a Chevrolet Silverado 1500 V8 4WD. $6,000 for a 2001 Silverado or $50,000 for a new one. The newer vehicle with $6,000 down is a whopping $800/month payment, and all you get to show for it is a 4MPG improvement. So not worth it from a cost perspective, especially because parts for a 2001 Silverado 1500 are so cheap and available. For example. while the 4L60E transmission used in a 2001 Silverado isn’t known to be the most reliable transmission, especially if the truck is used for towing, you can have your transmission replaced with a quality remanufactured one for $2-3,000 depending on your location.

As you can see, from a cost perspective, an older vehicle is always cheaper, assuming we’re talking about “normal” cars and trucks. When it comes to European cars like BMWs and Fiats, which are notoriously unreliable and expensive to repair, it’s a little different – that new or CPO (certified pre-owned) warranty is worth it for most people.


This is a tough one. On a new car, you have a warranty, so you won’t have any major issues for the first 36K or so miles, and if something does go wrong, it’s fixed for free.

On the other hand, with some research, due diligence on a potential purchase, a thorough pre-purchase inspection, and choosing a reliable year/model of vehicle, you can do 36K miles without major repairs on a used vehicle. And just remember, regular maintenance work like shocks, brakes, etc. that a used vehicle will need soon is a great way to negotiate on the price of a used car.

In terms of the inconvenience of having your car in the shop, you have less to worry about on a brand new car. On the other hand, you have to take it to a specific dealer, vs on a used vehicle you can take it to any shop – hey, both places I’ve ever worked have had at least two auto repair shops within a few block radius. Drop off your car and walk to work, then pick up after work or on lunch – super easy! And you can always take an Uber or something…

And from all the horror stories I’ve heard from people with new cars, they really aren’t perfect either. Things still go wrong, and then you have to put up with the dealer running in circles trying to wiggle out of repairing it.


This right here is what America is all about. Having a better, bigger, flashier car than your neighbor. I get it, I really do. I think I’d look cool driving around a brand new GMC Sierra 2500 with the beastly Duramax diesel, a pointless lift kit, and some sweet off-road wheels and tires that would never leave the pavement. If I won the lottery and got a ton of money I’d probably get something like that.

But at the end of the day, my 2008 Ford Escape with 215K miles is good enough.

Because let’s face it, nobody cares. Random people driving on the street only notice your car enough not to crash into it (hopefully). And unless you’re in some upscale industry, chances are both your clients and coworkers don’t care whether you have a nice used vehicle in good condition or a brand new car with dealer plates, because it simply doesn’t matter.

Hey, what about creature comforts?

Now, I know a few people that love new cars with all the gizmos and creature comforts. Backup camera, heated seats, heated steering wheel, etc. Sure, those things are nice, but most of us grew up in vehicles that didn’t have that, and we all survived. I draw the line at an automatic transmission, power windows, power locks, and air conditioning – the four things that are crucial to me in a car purchase, and everybody has their priorities, but you really need to sit down a think about how badly you need a heated steering wheel when comparing new cars to old cars.

I also would never own a car without a Bluetooth stereo, which, while standard on new cars, wasn’t all that common 5+ years ago. The good thing is, it’s very easy to install an aftermarket unit in most vehicles, and even if you aren’t mechanically inclined, installation of a Bluetooth radio will run you a couple hundred bucks at your nearest Best Buy or some local car audio shop.


Everybody’s situation is different, but it’s my opinion that a nice, well-taken care of vehicle that’s been around the block a few times is a better financial choice than something straight off the dealer lot.

One thought on “Old Car vs New Car – Long Term Cost, Safety, Reliability, Appearance

  1. Thank you for reminding me that we should always prioritize the passengers’ safety when it comes to buying a car. My brother crashed our family car last week and since it is a very old model, he easily received the entire force brought by the blow. We’ll take the car’s capacity to absorb force as one of our main concerns as soon as we apply for a car dealership.

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