This post was written by Frugal Dad.
For most people, buying a car is the second-largest purchase they will make in their lives, surpassed only by purchasing a home. When making such a major expenditure of your hard-earned money, it’s important to shop around and make sure you get the most “mileage” out of your dollar. Whether you’re looking for something brand new or a car that’s seen a few owners already, following some simple guidelines can help you make this important purchase a little easier on you and your wallet.
A must before heading out to the dealership or meeting with potential sellers is determining what you’re looking for and what your budget is. Having a clear idea of what you are realistically able and willing to spend on a car is essential to getting a good deal; if you haven’t considered your budget beforehand, it’s easy to get caught up in the excitement of shopping and pay more than you really want.
Price-conscious car shopping almost always means visiting more than one dealership or seller; be prepared to spend some time shopping around for the best deals! Be open to looking at cars similar to the specific one you’ve got in mind, too; even if you’ve got a dream car picked out, you may find a better price on one with similar features, design, and quality. Likewise, if you’re looking for a brand new car, also consider cars that are a year or two old. The price difference between a new and almost-new car can be huge, saving you thousands while you still reap the benefits of a low-mileage car in excellent condition. Don’t miss out on a good deal by being too picky.
Once you’ve determined your budget, you can start looking at cars from a number of different vendors, the most popular being dealerships and private individuals. If you plan to buy a brand new car, a dealership is your main option; if you’re shopping used, you have a little more flexibility when choosing where to buy.
One benefit to shopping at a dealership for a used car is that most dealerships offer “certified” used cars that have undergone mechanic inspections and are covered under a warranty. Warranties can save buyers significant expense down the road should the car encounter any problems. When shopping at a dealership, you may feel pressured by salespeople to make a decision and purchase quickly. Take your time; look around, go on test drives, and ask plenty of questions.
Buying from private parties is a bit riskier since few individuals will be likely to offer warranties for their cars. On the other hand, car shoppers can save serious cash buying from individuals who don’t need to up their price for the purpose of getting a good commission. Individuals also tend to have lower prices than dealerships because they are often as anxious to sell their car as you are to buy it. Again, don’t be shy about asking questions and taking test-drives in the vehicle; you’re about to spend thousands of dollars on this purchase, so you can and should take your time.
If you’re looking for a really good deal and are willing to take on bigger risk, you can also shop for cars with salvage titles. These cars have suffered a major accident or theft, and have been restored by repair and body shops. Given their troubled pasts, these cars can be problematic; if the repair work was done sloppily, the new owner will suffer the consequences. However, some salvage cars are carefully reconstructed and looked after, giving buyers a fully-functional used car at a fraction of the usual asking price. Even savvy car buyers can get a lemon when salvage title shopping, so pursue this option with caution.
Once you’ve found a car you feel good about buying, don’t start handing over your cash just yet; you’ve still got a couple money-saving steps to go. If buying a car from a private party or one with a salvage title, always take the vehicle to be inspected by an independent mechanic. Spending $50-$100 making sure a car is in good working order before you buy is worth the investment to be sure your buying price won’t go up a few thousand dollars in major repairs weeks later.
Finally, be willing to negotiate. When it comes time to buy, see if you can get your seller to knock off a portion of the price and give you a better deal. Negotiation is standard practice when buying from a dealership, and you’ll find many individual sellers willing to entertain reasonable offers as well.
By practicing self-control and keeping and your options open, you can hit the road in your new car, confident you’ve gotten the best deal possible.
Do you have any car-buying tips to share with us?
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