If you have ever tried to sell or trade in a car, you know just how absurdly much your car’s value can depreciate. Just based on simple economics and how the market works, your car’s value will inevitably dip after you purchase it. However, that’s not to say there aren’t ways you can minimize your car’s deprecation in value.
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Ways you can minimize your car’s depreciation in value
It is flat out impossible to completely avoid depreciation. That’s just how it works. But when some small details are paid attention to, one can help to keep their car’s value as high as possible. For example, choosing the right car and keeping it in good condition are the easiest things you can do to help ensure it retains most of its value.
Servicing your car is obviously a necessary part of being a car owner. Routine oil changes, tire rotations, and more expensive (and hopefully rare) fixes are needed to extend any vehicle’s lifespan. To maximize your car’s resale or trade-in value, hold on to your maintenance receipts and invoices for services, as a full service history can be used to up the value.
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Another way to keep your car’s value up is buying it in its second year. On average, a brand new midsize sedan that sells for $27,000 will lose $7,400 in value after one year. The year after that it will only lose $1,100, and in years two through four it will lose just $5,900 combined. In those three years, its value depreciates less than it did in the first year. Buying a car a year late saves the consumer a ton of cash, and the only downside might be very slight wear and tear. Avoiding depreciation is impossible. But minimizing it is plausible.
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