Greetings from the Hemet Car Guy,
Tax season is upon us and so are tax refunds for some. A survey shows a lot of folks may use their tax refund to buy a new or used car.
Sounds like a good idea but it may not be for a variety of reasons (and it might be for others). A new survey commissioned by eBay motors found that more than one-third of vehicle owners anticipating tax refunds will spend a portion of their newly found cash on something related to a car, truck, or motorcycle, and the parts to repair and maintain them. The data is based on a survey conducted for eBay Motors by Harris Interactive, which polled more than 2,200 adults across the United States.
According to the survey, 34 percent of current vehicle owners expecting tax refunds said they will spend part of their refund money to buy new or used cars or trucks, or spruce up their current vehicles. The categories in which the most people intend to put their tax refund dollars toward are:
• Maintenance (49 percent)
• Repairs (32 percent)
• Buying a new or used vehicle (21 percent)
• Tires (19 percent)
• Cleaning or detailing (14 percent)
Note: Survey respondents were able to select multiple options. If you were like one of the surveyors that would also choose “Buying a new or used vehicle,” make sure to stop by VIP Autos in Hemet or check out the website vipautos.net.
Based on the information in the eBay Motors survey, Americans appear to view tax refunds as opportunities to make purchases of vehicles associated with the joys of driving. The search terms on the internet that have shown the greatest increase in frequency during the past two tax seasons are motorcycle, sports car and exotic-related vehicles.
Here are some pros and cons about using your tax refund to buy a new or used car:
Pro: You don’t have to save for a down payment. Most Americans are going to use their refunds for down payments. According to the IRS, the average federal tax refund is $3,000 (in spite of what you see in those H&R Block commercials.)
Con: You’re most likely not going to get a good, used car for $3,000. Honestly, the best used cars outside of certified pre-owned are usually in the $8,000 to $10,000 range for most of us.
Pro: You’ll save money by buying now. Used cars keep going up in price. By buying now, odds are good you’ll be paying less for your used car than if you had waited.
Con: There’s going to be a lot of people out there just like you. That means it’s a seller’s market this time of year, which is competitive.
I hope this helps. Happy driving!
Richard Perry is the owner of VIP Autos in Hemet and is known to his readers in the Chronicle as the Hemet Car Guy. For more information about Richard Perry visit www.hemetcarguy.info