At some point in the lifespan of your car, whether it be 3 years down the road or up to 10 or more, its likely to lose its allure. You’ll find yourself magnetized to new makes or models with better safety and groundbreaking technologies. You’ll likely want to make the switch, thereby leaving you with a major decision: should I trade in my car or sell it?
The answer to this question is determined by the car you drive. You could essentially save hundreds or thousands of dollars by making the right choice. For good measure, you’ll want to weigh the pros and cons of each option to see which offers the most benefits. Fortunately, we’ve already done that for you.
Take a look at the pros and cons of trading in your car versus selling it privately. We hope these points guide you in the right direction when shopping for a new car this year.
Pros & Cons: Should I trade in my car?
Once you’ve set your eyes on a new vehicle, the decision to trade in your old car becomes that much easier. There are a lot of advantages to saying your final farewell to your past ride at the dealership. Here are the top benefits to keep in mind, followed by the cons that makes buyers hesitant of this decision:
In most cases, dealerships have no problem making a deal with you and your car. Once you select your dealership of choice, make a decision on a new car, and work out the logistics, your trade-in is guaranteed to just add value to your deal. It’s simply the most time-saving way to make a change.
Lower sales tax
The sales tax is the added financial punch to every deal you make when buying a new car. It’s inevitable, however, one of the main pros about trading in your car is having less of a fiduciary responsibility to the tax. Unlike selling privately, most dealerships only require you to pay the difference between the trade-in value and the price of your new car. All said and done, less money to get into a new purchase.
Less money in return
This reality is probably the hardest fact for new buyers to swallow. Since the dealership is in the business of making money, don’t expect them to be handing over full value for your ride. There’s no way around it. You will get less money compared to selling it yourself.
Finite buying power
Trading in your car at a dealership limits you to a certain deal. You’ll only get the amount the dealership is willing to offer, which means you might feel constricted within your decision. This is quite a contrast to having the cash on hand from selling beforehand.
Pros & Cons: Should I sell my car?
With excellent resources like Carvana’s sell and trade option at drivers’ dispense, the option to sell your car online or privately with a For Sale sign is a quick way to gain buyers interest. With a DIY mentality, you can set your price point either aggressively or right at market value. Here is the main pro and con of selling your car on your own:
More money in your pocket
As mentioned earlier, the option to sell is a one-way ticket to more money at hand. If you’re looking for the best value for your car and don’t care about putting in the legwork, you’ll end up making the best financial situation. Trading in your car is easy, but the reward is not always the same. With full value for your car, you can delegate some funds towards your new deal and put some away in your savings for future repairs.
Selling your car certainly adds more workload to your busy schedule. It requires gathering the right documentation, taking the time to fix minor repairs, and showing it to a number of potential buyers. Unlike trading in your car, selling to a private buyer will become a major time consumer, which is definitely something to consider.
Drumroll please — should I trade in my car or sell it?
After weighing in the pros and cons of both options, there comes a moment of truth. How much is the money actually worth to you? If you’re looking to make top-dollar return on your previous investment then selling is the way to go. A lot of drivers take a chance on trading in merely for the sake of time, but with the vast demand for both used and new cars on the market, the time to sell is now.
This option might not work for everyone, especially those who still owe payments on their current vehicle. However, it is the best way to make the most out of your new car deal experience. Whatever choice you choose, just make sure it works out best for your wallet and future car investment.