3 Ways to Save Money Buying Your Next Car
Buying a new car can get very expensive. Staying within a budget can be a challenge. Luckily, there are three simple steps you can take to save money on your new car purchase. Learn what steps to take to make sure you are not overpaying for your new car.
Buy Used, Not New
The minute you buy a brand new car, it starts to lose value. As a matter of fact, in the first year of new car ownership, according to Kelly Blue Book, you can expect to lose upwards of 20% in value. Once you drive that car off the new car lot, that car becomes a used car. Buying a used car can save money, a significant amount of money.
Most people do not realize how easy it is to get used car financing. In 2019, about 85% of cars were financed either with a loan or a lease. The same was true for 2018. You can get used car financing as easily as you can get new car financing.
Of course, the benefit of buying used is the lower price, but that is not the only benefit. This may sound counterintuitive, but used cars lose their value slower than new cars do. The previous car owner has experienced the majority of the loss in value before you ever purchase the car. It is a sounder financial decision if you are considering the return on your investment. New cars are one of the worst investments you can make.
Choose a Reputable Dealership
Who you do business with really matters when it comes to purchasing a car. There are a lot of dealerships that are what are called “fly by night.” A dealership with a good reputation has earned that reputation by being fair with their customers and providing reliable vehicles that they stand behind. Unfortunately, car dealerships, especially used car dealerships, often wind up in the newspapers for shady practices.
Recently a dealership in Ohio made the papers for selling vehicles that they had adjusted the odometer readings on. Messing with odometer readings is a white-collar crime, but a crime nonetheless. Even first-time offenders of white-collar crimes often wind up being sentenced to jail time as that dealership owner did. The point is, be sure that you do your homework when you are considering which dealership to do business with. Read reviews and talk to people that have purchased a vehicle from them before.
Do not let the lowest price or best deal be your only guiding factor. Work with a reputable dealership to ensure that you get the best deal and the best value. Saving money now and in the future strongly depends on working with a reputable dealership. Down the road, you will be glad you did.
Seek Friendly Salesman
You want to choose a salesperson that you feel fully comfortable with. Choose a salesperson that takes the time to answer your questions and is willing to educate you on your options. About 32% of consumers that jump ship for another brand do so because of dissatisfaction with customer service. Your level of satisfaction and whether you trust the salesperson or not is essential in the car buying process.
If you feel uncomfortable with the salesperson but still want to stay with the same dealership let the management know and they will put another salesperson on your deal. A friendly salesperson that wants to close the sale will pull out all the stops to find you the best deal and help you save money.
It cannot be stressed enough that you should do your homework if you want to save money. Pricing at various dealerships can range greatly for the same or similar vehicle. Do not be afraid to play one dealership against another by using the lowest price offer to get a dealership to move the needle a bit on the pricing.
Make sure you understand what you are paying for. There are a lot of small fees and charges that a dealership will roll into the cost of a new or used vehicle. If you have questions about the fees and charges, ask. You may find ways to save money by understanding what you are being charged for.
Don’t overpay for your next car, focus on these tips for saving money, and buy for less.