If you want to buy a new car, you should ask yourself, “Do I need a new car, or can I save money and buy a used car?” Though new cars are fantastic, there’s a lot to be said for your savings. If you’re going to purchase a new vehicle, you could potentially save quite a bit of money by purchasing a “nearly new” ride.

A “nearly new” vehicle is a pre-owned car of the previous model year. It’s a well-known fact that the value of a vehicle falls the second it’s driven off the dealer’s lot. Though this may be a bit of an overstatement, vehicle depreciation is a really big deal. Typically, it’s the owner’s most significant expense during the first several years of ownership. And, the most considerable doses of depreciation come in years one and two of ownership.

For a new-car owner, depreciation could mean a big financial hit, but it’s a substantial opportunity to save money for savvy car shoppers.

Here’s an example:

In 2018, a BMW 330i retailed for around $41,000. At that time, if you bought a one-year-old 2017 BMW 330i instead of a 2018 model, you would get everything that the brand-new 3-Series offered for around $35,000!

Thinking this is some anomaly peculiar to BMW or luxury cars? It’s definitely not! Depreciation is everywhere! This means you could find similar potential savings across the automotive market.

So, if you’re not ready for the 3-Series yet, a Honda Civic is an excellent entry-level car to consider. Back in 2018, a new Civic EX offered excellent value at an average transaction price of $23,500. In contrast, a pre-owned 2017 EX with the same specs could be found at $21,500. It could’ve had as many as 12,000 miles, but the balance of the factory warranty would still cover it. This means that you would have saved about $2,000.

A critical aspect of buying nearly new vehicles that you should know is that the car you buy will be one model year older than the brand-new car you’re considering. This can result in a lower trade-in value when it’s time to get a new vehicle.