Buying a used vehicle is one of the biggest financial hacks that I know of. Did you know that new cars lose 10-20% of their value as soon as you drive it off the lot? They only continue to depreciate over time.

Unfortunately, not only do they lose value over time, most people end up paying significantly more than the car is worth due to interest payments. If they aren’t sure what they are doing, they can get slapped with a high interest rate on a car that they already couldn’t afford to begin with, simply because they were “talked into” purchasing the latest and greatest.

All that being said, you do need to be careful when purchasing a used vehicle too. It’s easy to purchase a vehicle without knowing all of the issues it may come with and how much it will cost to repair it. If you know a trusted mechanic, I highly recommend asking them to come along and look over the vehicle before you purchase it. I actually still have my first vehicle, it’s a 2002 Volkswagen that I got when I was approximately 15 years old. I’ll be 32 years old this year, but because we’ve (my brother and I – he’s a mechanic; and now my husband and I) maintained the car, it is a wonderful back up vehicle for my family. We’re using it currently since one of our cars sprung a coolant leak. Our family has to have two cars due to both my husband and I working. Cars that are well maintained can last a very long time.

All good things must come to an end, so it’s also important to know when a car may not be worth repairing too. Please find someone that you trust to work on your car and get their opinion. Used cars can save a lot of money, but they can be money pits too. It’s important to know the difference. The money you save on a car payment could be put towards other debt or into savings for when you want to “upgrade” your car or for other big purchases.