Here’s How Much an Auto Loan Will Cost Retirees for a New or Used Car in Arizona

Did you know that two-thirds of Americans swap their cars every five years or less? Whether this describes you or not, a study by insurance company The Zebra found that most people end up car shopping every eight years or so.

If you live in Arizona and are thinking about buying an automobile — especially if you are a retiree on a fixed income — you should get a good picture of the new and used car markets before you go shopping.

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GOBankingRates recently conducted a study on the average auto loan rates across the U.S., focusing on rates for commonly purchased vehicles like SUVs, trucks, electric cars, and sedans.

Learn more about Arizona’s auto loan rates below to make the best purchasing decision for your financial situation.

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How Much Does an Average New or Used Car Cost?

The cost of vehicles in your area will fluctuate depending on your regional living costs and the local supply and demand, but used cars are roughly half the cost of new cars nationwide.

New car national averages:

• Average price: $47,480
• Average amount financed: $37,984

Used car national averages:

• Average price: $25,415
• Average amount financed: $20,332

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How Much New and Used Auto Loans Cost in Arizona

If you live in Arizona and are in the market for a vehicle, it’s essential to understand the difference in auto loan rates for new and used vehicles. The following is a breakdown of the average loan, according to vehicle type.

New SUV

• Average auto loan rate: 7.2%
• Average auto loan total cost: $47,290
• Average auto loan monthly cost: $755

Used SUV

• Average auto loan rate: 11.5%
• Average auto loan total cost: $25,903
• Average auto loan monthly cost: $447

New Truck

• Average auto loan rate: 7.4%
• Average auto loan total cost: $47,347
• Average auto loan monthly cost: $759

Used Truck

• Average auto loan rate: 11.3%
• Average auto loan total cost: $25,872
• Average auto loan monthly cost: $445

New Electric Vehicle

• Average auto loan rate: 4.5%
• Average auto loan total cost: $46,646
• Average auto loan monthly cost: $709

Used Electric Vehicle

• Average auto loan rate: 11.8%
• Average auto loan total cost: $25,950
• Average auto loan monthly cost: $451

New Sedan

• Average auto loan rate: 8.3%
• Average auto loan total cost: $47,580
• Average auto loan monthly cost: $776

Used Sedan

• Average auto loan rate: 13%
• Average auto loan total cost: $26,107
• Average auto loan monthly cost: $462

State Average for All New Cars

• Average auto loan rate: 7.7%
• Average auto loan total cost: $47,352
• Average auto loan monthly cost: $760

State Average for All Used Cars

• Average auto loan rate: 7.4%
• Average auto loan total cost: $25,950
• Average auto loan monthly cost: $451

Tips for Finding an Affordable Car

Whether you’re a retiree or not, following these tips can help you find the most affordable vehicle for your budget:

1. Research first: Your first step should always be researching your options. Consider the reasons you need a car and determine which type of vehicle best suits this role. Then think through different factors like storage requirements, insurance costs and fuel consumption.
2. Figure out how much you can afford: Many retirees live on a limited budget, so make sure you don’t spend beyond your means. You can use an online auto loan calculator to solidify your budget and narrow down your options at the dealership.
3. Buy a used car: Used cars are typically cheaper than new cars, so this is one of the best ways to lower your overall expenses. But don’t forget to research the vehicle’s history to avoid expensive maintenance costs in the future.
4. Take it for a test drive: Be sure to thoroughly inspect any car before purchasing it, especially when it comes to used vehicles. This will help you avoid buying a car with hidden defects and avoid unnecessary repair costs.
5. Learn about financing options: Compare financing plans from different banks, credit unions and dealerships to figure out which plan offers the best payment terms. One way to clarify your budget and streamline the purchasing process is to get preapproved for an auto loan before going shopping.
6. Negotiate with the seller: Whether you’re buying from a dealership or a private seller, it’s always worth the effort to negotiate the final price. Make sure you’re prepared with information about average costs for your chosen vehicle, which could potentially help you negotiate a lower price.

Methodology: For this study, GOBankingRates analyzed each U.S. state to find the average auto loan rates. Using Edmunds.com’s car loan rates from August 2024, the auto loan rates were found for SUVs, trucks, electric cars, and sedans, as well as the overall average for used and new cars for each state. The average total cost for an auto loan can be calculated by using the average used car and new car price, as sourced from Kelley Blue Book, assuming a 20% down payment, and using five years for the loan term. The monthly and total auto loan costs can both be calculated for all states and car types. Using these filters, the total cost for an auto loan can be calculated for each state with different car types. All data was collected on and is up to date as of Sept. 5, 2024.

This article originally appeared on GOBankingRates.com : Here’s How Much an Auto Loan Will Cost Retirees for a New or Used Car in Arizona