There’s nothing like the smell of a brand-new car. The leather interiors, touch screen system, and fancy features are more than enough to entice anyone to buy a car. But a vehicle purchase can be one of the most expensive black holes in any budget.
Unlike real estate, cars are a depreciating investment. A vehicle’s value drops the minute you drive it off the dealership. Which is why it’s essential to have a money-saving strategy in place before you hunt for your next car. Here are a few ways you can do it.
1. Do Your Homework
Even before you go out to the dealership in search for your next car, do a little introspection. It helps if you do your homework and have a checklist of questions such as:
- How much am I willing to spend on my next vehicle?
- What type of vehicle do I need? a Car, truck or SUV?
- What size should my next automobile be? Small, medium or large?
- Power and fuel efficiency – Gas, hybrid or electric?
- What safety features and entertainment options do I need?
- Entry level or top of the line?
Answering these questions will give you a clearer picture of what you want versus what you need.
2. Research and Compare Vehicles
After determining what type of car you need, do some research on the specific vehicle brands you like. Compare prices, specifications, talk to mechanics and read reviews to avoid getting a lemon vehicle. Plenty of people end up spending more money because they’re clueless about what they want and buy the first shiny car they come across.
3. Set a Strict Spending Budget
Determine how much you’re willing to spend on your next car and stick with it. Don’t fall for all the extra options and add-ons the dealership throws at you unless it’s something you firmly believe you need.
4. Be Patient About the Process
Impulse buying is your worst enemy. If you know what car you want, but can’t get the price you want for it, walk away and move on.
5. Consider Buying a Used Car
Used cars make more financial sense than buying a new vehicle because old cars don’t depreciate as fast as new ones. Buying used also makes sense if you’ve always wanted a particular make and model, or if you want the top-shelf model with all the features. Make sure you do a vehicle background check before buying a used car. You can check your car’s vin number here.
6. Get the Lowest Vehicle Price Possible
Don’t be afraid to tell dealerships that you’re asking around. Inform the sales representative that you’ll award the sale to the one who can give you the best price.
7. Avoid Auto Loans and Pay in Cash
You’ll end up paying more money on car loans, especially if it exceeds 36 months. If you have to get a loan, choose the shortest amount of time possible to pay for it. Only spend what you’re certain you can afford on your monthly salary though.
8. Save Up Money First
To avoid wasting money on interest, consider saving up before buying your next car. Set up a savings account that automatically deducts from your main bank account so you won’t have to worry about forgetting to put money in.
9. Trade-In an Old Automobile
You can trade-in your old vehicle at the dealership to lower the price of the car you want to buy. But be prepared to accept a lower offer than what you would get if you sold your vehicle to an individual. Here are tips for estimating the value of your car.
10. Sell Your Car, Truck, or SUV Yourself
If you want to get the most out of your car, sell it yourself. Avoid selling to garages or used car lots and seek out an enthusiast. It may take a while, but there are enthusiasts for every type of vehicle, so do your research and be patient to get the best deal.
Final Thoughts on Saving Money When Buying Car
Follow the steps we outlined in this article and save big on your next car purchase!
Patrick Peterson is a writer/editor at AutoDetective. Born and raised in the automotive world. He’s a passionate writer who crafts exquisite content pieces about everything related to cars and bikes.
