To Sell or To Trade-In A Car? That Is the Question
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When it comes time to buy your next vehicle, and you need additional funds to complete the purchase, you'll probably want to sell or trade in your current one.
But which option is right for you?
Though many believe selling your car to a private party can net you more money in total, the truth is, it can be a laborious, time-consuming process that can take weeks or months.
On the other hand, trading in your vehicle gets you behind the wheel of your next car as quickly as possible, but you may not receive as much money in return.
Weighing the pluses and minuses of each option can help you decide which fits your needs best.
Is it better to trade in or sell? Let's look at the ins and outs of both.
Selling your used car
Sure, selling your current vehicle to a private party may bring you more money toward your next car purchase when compared to trading it in.
But along with those extra funds comes additional work and waiting that can keep you from moving forward with your next car purchase.
Selling a car yourself entails cleaning it up, taking pictures, placing ads, and answering calls from prospective buyers.
And once you have an interested party, you have to meet them, allow them to inspect and drive the car, then work out the sale details. All in all, it can be a hassle that has the potential to take days, weeks, or even months before a deal goes through.
If your current vehicle happens to be an unpopular model on the used car market, you face the possibility of it not even selling or receiving a price less than you'd hoped for.
When you're ready for your next vehicle and need to sell your old one, Shift makes it easy. All you'll have to do is enter the make, model, year, and mileage on Shift's easy-to-use website, and you'll instantly receive a purchase offer that's valid for seven days. With Shift, there is no need to spend the extra time waxing and washing the car. A little dirt will not affect the quote, and we fully detail the cars ourselves anyway before listing them for sale. You can get a fair offer, better than at the dealership, driven by powerful machine learning algorithms and tons of data.
Trading in your used car
When compared to selling a car yourself, trading one in is simple and easy.
Instead of hours spent preparing your vehicle for sale and talking to potential buyers, trading it in is as basic as agreeing to an offer from a seller, receiving funds in return, and putting them toward your new purchase.
While sometimes trade-ins don't equal the monetary value generated from a private sale, the ease and convenience streamline the process of buying your next car.
Another advantage of trading in your car involves sales tax. Many states only impose sales tax on the amount left after subtracting the trade-in value from the sales price. This could amount to thousands of dollars of savings, allowing you to use your hard-earned money to opt for, let’s say, a Lexus in lieu of a Toyota or an Audi instead of a Volkswagen as your next set of wheels.
Is it better to trade in or sell?
Whether or not it's better to trade in or sell your car depends on what's more important to you: money or convenience.
Say you decide on selling your current vehicle privately, even if it takes more time and effort. First, you have to wash and clean your car thoroughly. Then you have to take detailed photos before placing an advertisement and writing up a thorough description.
Then the waiting begins. Maybe you'll receive some phone calls soon after, but perhaps you won't, and acquiring your next vehicle gets pushed further and further out.
Once you find a buyer, you'll have to meet them in person, look over the vehicle, and possibly take a test drive. That could take a good part of your day. And if they decide on buying your car, you'll then have to complete a myriad of administrative tasks, like transferring the title and assisting with registration.
On the other hand, the ease of trading in your used car makes the process hard to beat.
Instead of the hours and hours spent preparing your car, placing an ad, and answering the phone, you can visit a seller and decide whether or not you accept their offer. And if you do, you can take that money and put it right toward a down payment on the car of your choice.
Then you can drive away the same day in the car you want, with a nice amount of money paid toward the sales price.
Buying a used car can save you thousands of dollars. But wouldn't it also be nice to have the reassurance of a warranty? Shift offers best-in-class service contracts at a fair price without sales pressure. You get the great price and value of a used car with the bumper-to-bumper protection of a new car. And you know you're buying a quality car from Shift because certified mechanics perform extensive 150-point inspections on every vehicle sold, and you get a free Carfax report for the ultimate in transparency.
2013 Honda Accord LX (from $15,950)
Is now a good time to buy a used car?
In 2021, the average new car price was more than $45,000, and the median used car cost was around $25,000. For that reason alone, buying used is a wise financial decision.
But beyond saving money, buying used also gives you several additional advantages.
Having the ability to choose from a wide selection of pre-owned vehicles across the country, rather than waiting on dealer inventory, helps zero in on the one you want. And with so many cars to pick from, you can search for your preferred combination of options and colors.
And with today's excellent vehicle service contracts, like those that Shift offers, you can drive worry-free, safeguarded from unexpected mechanical issues.
Cars experience the most drastic depreciation in the first year of ownership, around 20-30 percent, so buying used gives you a more stable investment.
2018 Maserati Ghibli S Q4 (from $43,500)
Is it better to trade in or sell in summary
Selling or trading in your current vehicle gives you a nice amount of money toward your next one. And a down payment makes purchasing a new-to-you car easier on your wallet, lessening the amount you need to finance.
Deciding whether to privately sell or trade-in your old car is a decision that depends on whether you put a greater value on money or convenience.
While selling your old vehicle can mean more cash in your bank account, it's time-consuming and could take days, weeks, or even months to complete.
On the other hand, trading is easy in comparison and allows you to drive away in your new car the same day.
The views expressed in this article do not necessarily reflect the views of the author or Shift Technologies, Inc. Shift does not endorse or evaluate the accuracy of any claims made or data provided by third party sources referenced herein.
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All prices are based on vehicle availability and pricing as of
April 15, 2022
Pricing shown is not guaranteed and does not include taxes or other product fees.