When buying a car, you always expect to invest a large amount of money into a quality vehicle. However, you can also shop for your next car with a budget friendly strategy so that you do not overspend. Here are 5 smart car-buying tips for frugal shoppers.
- The first and most important tip is to sit down and truly determine if you are shopping for a new car because you absolutely need it or simply because you want something new. You may really need a new car if your current car is guzzling gas, broken, or if you do not yet have a vehicle. However, if your car is still in good condition and you can get a few more years out of it, it may be best to continue saving up and work with what you have for the time being, so that you are not spending a lot of money for no reason.
- Avoid leasing a car or buying a car brand new. This is never a good move. When you lease a car, it is not the best financial decision because you pay monthly, and in the end you do not have anything to show for it. It is comparable to renting an apartment as opposed to owning a condo or home. In the end you can sell a condo or home for some profit, but you are left with nothing when your rental agreement ends. In regard to buying a new car, this is also not a wise choice. A car’s value depreciates the second you drive it off the lot. You will never get back what you initially invested and are playing a lot extra simply to know that you were the first person to own the car. Instead, try buying a car that is only a year old so it will be in near perfect condition at a fraction of the cost!
- Research a variety of cars. Before you even head to the car dealership, scope out the web to see which cars fall in your price range. Also look at which features you’d prefer. You can check reviews, ratings as well as Consumer Reports. Also talk to friends or neighbors to ask about cars they like or what kind of car they currently drive.
- Set a budget and be realistic. Before you venture out, you need to know how much you can realistically afford to spend on your next car. Don’t simply consider the monthly payments; also look as the overall price including any fees, taxes and maintenance work you will need to pay for. In addition, consider the car’s gas mileage in order to determine if it will be an affordable car to drive (think Prius vs. SUV).
- Finally, you need to look into financing options. If you can pay cash, that is always the ideal way to go, but if you need to finance, be sure to get it yourself. Never stress over financing when you’re in the dealership, instead show up pre-approved with a loan from your personal bank or a credit union. This way you will have the power and ability to negotiate a deal with the dealership and often get a better price for the car you want!
Planning ahead and keeping these tips in mind will help you to shop frugally so that you can get the car you need and love without breaking the bank. Aside from inspecting the vehicle to ensure it shifts in sixth gear, you need to take financial precautions as well. Always be sure to shop around and do research first, buy a used car over leasing or purchasing brand new, set a budget, and get financed ahead of time.