When it comes to your expenses, the cost of your car is certainly at the top of the list. With Americans holding onto their cars longer, it has become extremely important to car buyers to get a quality car for the best price. Recent research from the AAA agency shows that the average car price is now close to $40,000 and the average American spends $9,282 on their car each year. Therefore, whether you are upgrading your car for your growing family or are a first-time car owner, being a savvy buyer is just as important as choosing the right car. Getting the best price for your car essentially means you are getting the best return on your investment, and it is key in preventing you from overextending yourself financially. Taking simple steps before you make your next car purchase can save you thousands of dollars and help you find the best car for your needs and your budget.
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Define Your Optionals And Non-Negiotables For A New Car
Getting the best price for your car also means choosing the right car. Whether you opt for a used car or one fresh off the dealership lot, each buyer must have a list of must-have features they need in a car. Try to be specific as well. For example, don’t just list extra space as a need, but relate it to your lifestyle and how it would be used. Maybe you will be taking a lot of family road trips, which means a kid-friendly and spacious backseat (and trunk) is needed. Once you have created your list of must-have car features, you can head online and narrow down the models that offer what you need at a price you’re comfortable with. You can also research specific reviews from past car owners to gauge how the car runs, its wear and tear record, and whether the model is worthwhile buying used.
Spend Time Checking Around The Market
Generally speaking, it is recommended that you follow the 1/10 rule for car purchases, which means spending no more than 10 percent of your income on a car. If you are going to get the most for your budget, you need research, not just the best cars, but the best times to buy and the best places to buy your car from. Start with narrowing down your list of potential cars using your list of must-have features and of course, your budget. If you plan to buy local, it is always wise to check out more than one dealer in your area. Visit the dealership and have a conversation with your sales representative to get an idea of their mark-ups. More often than not, their prices are negotiable. Finally, don’t forget to make use of online automobile selling and valuation platforms to choose your target price and get an idea of what the car sells for in different conditions (new, used with high mileage, etc).
Don’t Just Shop Around For A Good Car – Shop Around For Good Financing
Around 44 percent of Americans use finance to purchase their cars, used or new. According to the Federal Reserve Bank Of New York, car buyers average a $515 monthly repayment on loans for new cards and a $358 repayment on loans taken for used ones. With the average time spent repaying auto loans climbing beyond 7 years, you need to consider the attached costs of financing your car. A simple browse or use of an online loan calculator can give you a glimpse of the various interest rates banks and lending institutions may charge you based on your credit score, loan value and payment history. While credit unions tend to offer the best rates, banks and dealerships can also offer valuable incentives like promotional discounts on car insurance.
Stick With The Age-Old Trick: Haggling
Finally, when heading into price negotiations, be sure to go into them well informed and armed with information. Knowing about your chosen car, the current market value and even reviews of its performance are great tools you can use in your bid to drive the price down. If you haven’t seen any current offers or incentives on their websites, don’t be afraid to ask. Car dealers want to move stock off their lots and are more open to discounts than you may initially think. You also want to be aware of the trade-in value of your old car at various retailers (if applicable) and the vehicle’s invoice price, which is the recommended starting point for your bidding.
Buying a new car is not just about choosing the right car for you: it is about choosing the right car for your wallet. After all, your car purchase is one of the biggest purchasing decisions you will make besides buying a home. By going into the car buying process prepared and armed with a few simple tricks, you can ensure you get the most out of your car and the most from your money.