If it’s time to buy a new car, then it’s also time to learn to buy one without breaking the bank. Here are seven things a shopper should consider before a dealer tosses them the keys.
1. Do Your Research
Comparing and contrasting prices is probably the most vital thing you should do to get the best deal on a car. But price isn’t the only aspect you’ll want to think about: fuel efficiency, maintenance costs, and the average total cost of ownership are all just as important to your bottom line to learn about.
2. Set a Budget and Stick With It
Just like with any large purchase, you’ll want to make a separate budget and adhere to it. This budget should include some of the previously mentioned elements, like fuel cost, but also other expenses, like insurance. You don’t want to just see if you can afford the car itself—you want to ensure you can drive it without worrying you’ll run your bank account into the ground.
3. Turn Back Time With the Model
Don’t be too enticed by the most recent models. Many older model years are still fantastic cars. And not only that, but dealerships are often itching to rid themselves of the older cars to make way for the new ones, meaning you can likely snag a better deal if you time things correctly.
4. Haggle Your Heart Out
It’s not just something your dad did back in the day — negotiating prices for a car is pretty typical, and dealerships are used to striking deals with potential buyers to get their inventory off the lot. Try not to negotiate down from the sticker price. Instead, determine what the dealer paid for the car and go up from there to get the best possible deal.
5. Be Wary About Extras and Add-Ons
It’s a salesperson’s job to convince you that you couldn’t possibly live without an extended warranty. But we promise you, you can. A lot of these extras can be valuable in niche situations. Still, if you just need a car to get them from point A to point B, don’t fall for the siren call of the car salesman trying to get you to shell out for paint protection: it’s just not worth it.
6. Sell Your Old Car
Before you even bother with a budget, determine the value of your current car and include it in your budget. Selling your old car frees up a lot of extra cash for you to play around with, regardless of whether you spend it on the new car or not. You’ll likely need it until you buy the new one, but you can at least consider its value as part of the overall cost of the new one.
7. Try Certified Pre-Owned
Certified pre-owned cars, or CPOs, are usually significantly less expensive than brand-new cars. And most frugal people would agree that a brand-new car isn’t the wisest thing to spend your money on anyway. However, CPOs are lightly used and still in terrific condition, so you’ll get a like-new car for a used car price — a total win-win!
