New Cars Vs. Used Cars

Q: I need a new set of wheels and I’m wondering if it’s better to spring for a new vehicle

Two women looking at car

or to go the cheaper route and buy a used vehicle. What do I need to know about each kind of purchase?

A: Any decision surrounding a purchase as large as a car needs to be made with careful research and consideration. There are pros and cons on both sides of the fence here. Your final decision, though, will depend on your budget, personal preferences and particular needs.

To make your job a little easier, we’ve outlined the pros and cons of each purchase type below.

Pros of new cars

  • Status symbol. The strongest allure of owning a new vehicle is obviously its attractiveness. You don’t hear many people bragging about their just-purchased used car or posting pictures of it all over their social media pages.
  • Fewer repairs. With a new vehicle, you can assume you won’t be dealing with major repairs or maintenance issues for a while.
  • Easier shopping. When everything is completely new, there’s no need to drag your prospective new car to the mechanic. It’s also easier to determine a fair price for the car.
  • More financing options. If you’re considering a new car, you’ll be offered attractive incentives like cash rebates from the carmaker and better interest rates from the lender.
  • Improved technology. Cars are getting more updates, and recent models have incredibly convenient technology, such as programmable settings, autonomous emergency braking, adaptive cruise control, blind spot monitoring, built-in Wi-Fi hotspots or lane-departure warnings.
  • Automaker’s guarantee. All new cars come with warranty coverage for their first three years or 36,000 miles, whichever comes first.

Cons of new cars

  • Price. Of course, a new car is going to be more expensive. But it’s not just the price that puts you at a disadvantage – it’s the fact that you can get a perfectly comparable vehicle for much less.
  • Depreciation. New cars go down in value as soon as they leave the lot. In fact, a new car can lose 20% of its value once it’s owned. At the end of the first year of ownership, your new car can drop another 10% thanks to the mileage you’ve clocked and the wear and tear. You’ll feel this loss if you try to sell your car a few years down the line.
  • Higher premiums. Insurance companies charge more for newer vehicles. You’re also more likely to want the maximum coverage and protection when every dent in your new car is enough to bring you to tears.

Pros of used cars

  • Price tag. Let’s be honest here: No one would think of buying a used car if it weren’t for the savings. And those savings can be enormous! Consider this: according to the National Automobile Dealers Association (NADA), the average American own 13 cars in their lifetime. A typical new car costs $30,000. If each car that a person owns throughout their life is just 3 years old and costs $20,000, the driver can save $130,000 on car costs throughout their life!
  • Less depreciation. The savings on a used car don’t end at the dealer’s lot. With the previous owner absorbing the initial depreciation on the car during its first few years of ownership, your vehicle will only experience a minimal drop in price. You can save yourself thousands of dollars in loss if you want to sell your car a few years down the line.
  • Lower insurance premiums. With your car weighing in at a lower value, your monthly insurance premiums will be more manageable. You can also opt out of full protection when your car isn’t a new model anyway.
  • Lower interest. If you choose to finance a used car instead of a new one, you’ll likely have a higher interest rate. However, since the loan amount is lower, you’ll save in total interest payments over the life of the loan.
  • Predictability. When purchasing a just-released car, you never know what issues might crop up in the future. But, when you’re buying a model that’s been around for a few years, you’ll have a wealth of research and ratings available on your car so you’ll know what to expect.

Cons of used cars

  • Complicated purchase. You won’t be able to walk into a lot and walk out with your new car an hour later. With a used vehicle, you’ll want to get a vehicle history report, ask to see the vehicle’s service records and bring it to a mechanic for a professional inspection.
  • Fewer choices. When buying pre-owned, you don’t get to be picky about things like colors, upgrades and features. If you find something in your price range that meets most of your specifications, you grab it!
  • Risk. Even if you do your homework well, you still run the risk of walking out with a lemon when you buy a used car.

It’s a multi-faceted decision, but by carefully weighing your options and personal preferences, you’ll drive off of the dealer’s lot with a real winner!

Whether you choose to go new or previously-owned, don’t forget to call, click, or stop by Destinations Credit Union to hear all about our auto loans. Not only do we offer one of the best car loan rates in the Baltimore area, between now and November 21, 2018 you can win prizes worth up to $200 in our CARnival of Savings event!

Your Turn: Did you buy your car new or pre-owned? Are you happy with your decision? Tell us all about it in the comments below.

SOURCES:
https://www.nerdwallet.com/blog/loans/compare-costs-buying-new-car-vs-used/

https://www.autotrader.com/car-shopping/4-questions-help-you-decide-new-or-used-car-167808
https://cars.usnews.com/cars-trucks/new-cars-vs-used-cars
https://www.iwillteachyoutoberich.com/blog/cost-vs-value-should-you-buy-a-new-or-used-car/

Don’t Get Caught In A Free Trial Scam!

You know what they say: “If it’s too good to be true, it probably isn’t.” And yet, dozens ofFingers pointing to computer key labeled Free Trial people fall for scams that promise them the moon – and they don’t realize they’ve been played until it’s too late.

Because of this truism, the Federal Trade Commission (FTC) is warning of an uptick in free trial scams. The scams come in several shapes and sizes, but most will look something like this:

You see an ad from Netflix or a cosmetic company saying you’ve been granted a temporary subscription to their service or product. They say it’s absolutely free. The only catch? There is none. They say that, anyway. That is until you’re asked to pay for hidden fees in addition to shipping and handling at a time when it’s too late to back out. Or, you might be asked to share all of your financial information even though you’re officially not obligated to pay anything.

In other words, there’s hardly a “free trial” that won’t cost you big.

In one such scam, a company aggressively advertised “free trials” for skin care products, dietary supplements and e-cigarettes on various popular websites. The lucky consumer would only need to cover the cost of shipping and handling and the product would be delivered – absolutely free!

Of course, the product wasn’t free and the unlucky victims sometimes paid close to $100 in fees before the first shipment was sent out. Worse yet, they were charged this same fee each month for the next year, with no way to back out of their contract until the 12 months were up.

In another scam with a similar setup, consumers were asked to share payment information for the $1.03 to cover shipping and handling for the “free” products. After their order was placed, another screen with a “Complete Checkout” button appeared. Shoppers who clicked that button unwittingly agreed to pay for monthly shipments of the product to the tune of $94.31 each month. And when that button was clicked, yet another “Complete Checkout” button appeared.

Again, those who clicked this button were subjected to a $94.31 charge each month. Consumers who’d taken the bait twice ended up with a total monthly charge of $188.62 – plus shipping.

In a third “free trial” scam, shoppers were lured into signing up for a 12-month trial subscription to a popular service, like Netflix, absolutely free. Unfortunately, though, the company advertising for the free trial wasn’t Netflix at all; it was a group of scammers. Victims were redirected to a new webpage where they were asked to share their sensitive information to qualify for the trial.

You can probably guess the ending: The scammer made off with the consumer’s information and emptied their accounts, went on a wild shopping spree or stole their identity.

Don’t let this happen to you! Here’s how to steer clear of free trial scams:

  • Do your research. A quick online search of the company name with words like “scam” or “negative review” should give you a basic idea of what the business is all about.
  • Read the fine print. Too often, there’s no way to refute charges relating to this scam because the consumer agreed to pay them. Don’t click anything without reading all of the terms and conditions attached to the offer. If you can’t find any, or you can’t understand them, opt out of the offer immediately.
  • Look for an exit strategy. Is there a way to cancel the offer? Can you change your mind about the product? If you only have a small pocket of time to cancel the trial, you might be looking at a scam.
  • Always review your credit card and checking account statements. This way, you’ll immediately spot anything suspicious and you’ll be able to determine if you can back out of a shady deal.
  • Never share sensitive information online. Unless you’re absolutely sure you know who you’re dealing with, it’s difficult to know if a website is 100% secure.
  • Check URLs. When signing up for a free trial, you’ll usually be redirected to a new site. Check the URL of the webpage and determine if it matches the company you are allegedly dealing with.
  • Ignore urgent calls to action. If an ad urges you to “Act now!” or claims an offer will expire momentarily, it’s likely a scam.

Read the fine print and only sign up for free trials that won’t cost you in more ways than you’d imagined.

Your Turn: Have you ever been duped by a free-trial, or similar, scam? Share your experience with us in the comments.

SOURCES:
https://www.google.com/amp/s/www.lovemoney.com/news/amp/69117/netflix-free-trial-subscription-scam-warning-fake-1-year-offer-email

https://www.consumer.ftc.gov/taxonomy/term/858
https://www.consumer.ftc.gov/blog/2018/07/dont-let-free-cost-you

Why More People Are Opting To Watch Big Games At Home

When your favorite sports season is in full swing, and as your favorite teams play in

gold football icon

important games, it’s time to decide where to watch the game. While going to a live game is exciting and sports bars have their appeal, more people are choosing to stay home.

Fewer People Watching at Sports Bars

In cities with NFL teams, as well as in cities without NFL teams, “Sunday sports bar foot traffic dropped by double digits between the 2015 and the 2016 season.” (1)

Why the move from sports bars?

Increasingly, people are choosing to stay at home rather than going to their favorite haunts to watch their games. The proliferation of options for online watching is at least one way to explain this trend.

Lots of fans, however, say it it just too expensive to hang out in a sports bar. The food tends to be costly and not worth the high price tag. Also, more people are trying to eat healthier food, a goal that’s easier to achieve at home.

There may be an unspoken competition to keep up with the drinking levels of others in the bar. That can lead to more expenses, in addition to other potentially serious ramifications, such as getting home late or not being able to drive safely at all.

About half of today’s football fan base is female. Women often find bars to be a less than ideal environment for watching sports, with distractions ranging from mild flirtations to outright harassment. It’s often simply not worth the hassle. For both women and men, the quiet, unthreatening home environment is a definite advantage.

What’s the Appeal of Home Watching?

First and foremost, the appeal of home viewing comes with the ability to control the remote. You are the captain of the ship when you watch at home. When watching on DVR, you can fast forward through commercials you don’t like or pause and get up for a snack. This is a luxury that viewers at the bar, or even at a live game, simply do not have.

What’s the most important aspect of watching the big games? Food, of course! At home, you can prepare your favorite dishes and snacks at a fraction of the cost of bar or stadium food and drink. You can choose healthy options and keep the calories down along with the costs.

Another advantage is flexibility. Thanks to online devices, you can run an errand at mid-game, keep up with the score on your mobile device and return home to finish watching the game. In our busy world, this flexibility makes a huge difference. In fact, it appears that some of the people who used to frequent sports bars are actually going to other places. “Instead of watching the game, fans appear to be finishing their errands. In 2016, hardware stores and gas stations experienced a 12% uptick in Sunday visits from people who frequented sports bars those days the year prior, according to Foursquare. Foot traffic to pharmacies and grocery stores also increased.” (2)

What About Atmosphere?

Many people like the camaraderie of watching games with like-minded fans. This is a legitimate reason to leave the comfort of home and seek out the hallowed halls of the sports bar. However, having a game night at home is increasingly the choice that many fans are making. You can invite the people you feel most comfortable sharing your team’s ups and downs with, and avoid the others at the sports bar who can spoil your fun.

What About Watching the Game Live?

While most sports fans agree that there’s nothing better than seeing their favorite team play live, when pressed they may admit that it just isn’t that comfortable to sit in the hard stadium seats or fight the crowds. Oddly, some fans report that even if they go to a live game, they watch it again on TV when they get home because they feel they missed too much by actually attending the game.

While paying pricy cable bills can be painful, going to a live professional sporting event can be much more expensive for a one-time event. In addition to the price of a ticket, there’s parking to consider as well as the cost of concessions and any souvenirs.

For many reasons, from costs and health benefits to personal control, it’s clear that skipping the sports bar and the stadium is a growing trend.

Your turn: How do you prefer to watch your favorite games? Live, at a sports bar, or at home?

SOURCES:
1. Foursquare, Steven Rosenblatt. https://medium.com/foursquare-direct/game-time-declines-d2a7d93ba37f  

2 Market Watch, Jacob Passy. https://www.marketwatch.com/story/why-we-should-pour-one-out-for-sports-bars-2017-08-17  

3 Is Watching Sports on TV Actually Better Than Being at the Game? Dan Levy. http://bleacherreport.com/articles/923563-is-watching-sports-on-tv-actually-better-than-being-at-the-game