Building Abundance through Strong Financial Foundations
How to buy the right car for the right price.
My daughter was recently in a wreck which totaled her car. She is ok, but devastated that her car has to be replaced. I gave her a list of things to think about and to find the right car for the right price. Purchasing a car is the second biggest investment most people will make in their lifetime.
Make a list of your must haves and then your wants. Once complete review the list with the next 5-8 years in mind. Example: Four door cars are convenient with children.
When deciding on a vehicle, I go to the library (one of my favorite places) and review top choices for used cars in the Consumer Reports Car Guide. I pick cars that have been out for a couple of years because they have plenty of reviews. New cars lose up to 20-30% of their value as soon as you drive it off the lot. I pick the top 2-3 cars and begin my research on prices.
Research your area for availability. The internet gives you a great place to start. You can look at various ads on Craigslist or AutoTrader.com as well as dealerships.
My family pays cash for cars. Cash talks. We have saved thousands of dollars over the years not having to finance a vehicle. It wasn’t always that way (we financed like everyone else until we became debt free). If you have to finance call around for the best deal. Start with your bank or credit unions. Purchasing from a car lot usually means you pay 1-2% higher. Shop around, know your numbers before hitting the dealerships.
Never lease a car. Leasing is like renting a house. You may get a same payment on a car but the backend of the lease costs a lot more.
If you purchase a car from an individual, meet at a bank, they can notarize the title and cash money orders for a small fee.
Think long term. Buy a car that you can keep long after the payments are over. Start making payments to a savings account and then you too can purchase with cash.
Talk to your insurance agent. Tell them some of the cars your looking at and price out the insurance for each. Ask about discounts. Multi-car, how close to work you live, good student, four door over two doors and non-smoking to name a few.
Cars depreciate over time, can cost a lot of money and require upkeep. Don’t buy until your ready, make educated choices and save money in the long run.