Saturday, June 2, 2018

Make the Most of Your Money When You Buy a Car

Getting a new car can be pretty exciting, but it's also one of the most expensive
things you can do. Before you spend thousands on your new purchase, you want
to know that your money is going to be working as hard as possible. Car dealers
will try to get you to spend as much as you can afford, but you don't want to
overspend. The maximum amount that you can spend isn't necessarily what you
should spend. If you want to make sure that you make the most of your money,
you need to do a few things to choose the right vehicle and get the best price.

Know What You Can Afford

Start by setting a budget, so you know how much you're prepared to spend. You
might not use your whole budget, but it's useful to have a starting point. If you're
not sure what you can afford, you might consider getting pre-approved for a loan.
Knowing what lenders are willing to give you can help you work out reasonable
monthly payments. However, be aware that some lenders are willing to give you more
than it might be wise to spend. If you spend less than your maximum budget, then
you're doing well.

Compare New vs. Used

If you want more car for your money, considering buying used is obviously a possibility.
A used car could be as good as new, but cost you a lot less. As soon as a new car
leaves the dealer's lot, its value goes down. So even a car that's had one owner for a
couple of months to a year could save you a huge amount of money. However, a
used car isn't always the way to go. If you get it wrong, you could end up spending
more over the car's lifetime than you might have spent on a new car. If you're going
to take the used route, buying from an approved dealer is often best because you know
they'll do the proper checks.

Compare Buying vs. Leasing

As well as thinking about whether it's better to buy new or used, you can weigh up the
pros and cons of leasing. Leasing a car is a great option for some, but other people
just prefer to own their car. If you lease, you could find that your monthly payments
are lower. At the end of the contract, you'll have a choice of things to do, depending
on the contract type. You can give back the car and not lease another, choose to lease
another car, or sometimes buy the car so that you can keep it. With a leased car,
maintenance costs are low, and you don't have to worry about depreciation. However,
higher insurance rates complicate things.

Don't Buy Bigger Than You Need

It can be tempting to get the biggest car you can afford. You might not ever leave suburbia,
but that doesn't mean you won't ever need a huge, off-road vehicle that can handle
anything. It's certainly useful for the school run. But there's no need to buy a big car if
you're not really going to use it to its full potential. If you like the idea of something sporty
and suitable for the outdoors, consider a medium SUV. You can get a car that's safe
and works as a family vehicle, without going overboard. Think about how many seats
you really need, and what you need your car to be capable of.

Hone Your Negotiating Skills

If you're hoping to save some money, you need to be prepared to negotiate. This can
be tough, as many people are shy about doing it and it's difficult to push against the
dealer. But they want to make a sale, and they can be persuaded to offer a lower price
or throw in some extras. So how do you do it?

Before you go to a dealership, prepare your strategy. Do some research on prices and
especially check if any other dealers are offering better deals. If you want to (or have to)
go with a particular dealer, using their competitors can be a good way to talk down the
price. Make sure you know which features you need, so you can get a lower price on
the car you want and not get talked into giving up some of those features. When you're
at the dealership, don't let the salesperson know your maximum budget - or they'll try
to get you to spend it. Ask outright how much they might be able to drop the price by -
if you don't ask, you don't get. Remember to be polite, but don't let yourself get pushed
into anything you don't want.

Be Careful of Add-ons and Extras

It's important to know what features and add-ons you need to have. Make sure you're
familiar with everything that you get as standard and what's available as an extra.
Some salespeople will try to talk you into having things that you don't need, so be firm
on what you want and what you think is a waste of money. Try to be strict with yourself
too, and avoid spending money on shiny extras that aren't really going to improve
your driving experience. Be careful of things like extended warranties or extra
protection for your car too - you probably don't need them.

Think of the Long-term Costs

When you buy a car, don't just consider the initial price of the vehicle. There are other
costs to be concerned about too. How much will the car cost to insure? Are you going
to be paying more for fuel for one model compared to another? Are there any
maintenance problems associated with the model or manufacturer that you might need
to watch out for? The cost of a new car includes a range of different factors, and you're
likely to own it for at least the next few years. Don't just think of it as a one-time purchase.

Take a Test Drive

Remember always to test drive a car before you decide whether to buy. You need to
know how it handles, and whether you feel comfortable driving it. Of course, it might
not feel completely right on your first spin, but there's a difference between a car that
you need to get used to and one that doesn't work for you. Take note of a few different
things during your test drive, like how the car feels when you accelerate, brake, and
turn. Does the car run quietly, and do you have good visibility? If you're thinking of
buying, it's a good idea to do another test drive at night.

Trade in Your Old Car

Trading in your current vehicle is a great way to get a discount on your new one.
However, it's best if you keep quiet about it until you've reached a price on the new car.
Once you've agreed, you can let the dealer know that you'll be trading in your car.
If you are going to trade it in, it's important to know how much it's worth. You don't
want to be short-changed, but it's also important not to have expectations that are
too high. The Kelly Blue Book is a good way to check what your car might be worth
and get a realistic impression of how much you could save on your new car. Use
the KBB figure to back you up when you trade in your vehicle.

Make the most of your budget when you buy a new car by taking your time with the
process. Don't rush into anything and learn how to hold your nerve.

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