Buying a new car can be such an exciting experience. After all, buying a new car is like meeting a new friend. You’ll use your car almost every day, and will depend on it for countless tasks.
Yet, it’s only natural to feel a little ambivalent about buying a new car. A new car comes with a new auto loan and other expenses. This includes car insurance, registration fees, taxes, and more
We’re here to help alleviate some of your stress. Keep reading for five car buying tips to help you save money.
1. Buy Used
First, if you really want to save money, avoid buying a brand new car. We recommend buying a vehicle that’s at least a few years old. Brand new vehicles depreciate rapidly, losing as much as 30% of their value in the first year.
By buying used, you can avoid taking the financial hit on the worst of your vehicle’s depreciation. Obviously, older vehicles also come with lower price tags. Buying used is one of the most practical car buying tips to save money.
2. Do Your Homework
The more research you do, the less likely you are to get swindled by private sellers or car salesmen. Find a vehicle you are interested in, then do some homework to learn more about its value.
Use Kelly Blue Book to find the car’s value based on age, condition, mileage, features, etc. Then, you’ll have leverage if the seller is asking for too much.
3. Trade-In Your Current Vehicle
Whether you’re looking at new vs used cars or vice versa, it never hurts to trade in your current vehicle. If you’re not planning on keeping your old car, trading it in can knock a significant amount of money off of your new car price.
It can be used as a downpayment which will allow you to take out a smaller loan, and possibly, get a better interest rate. Of course, these car buying tips are only possible at participating car dealerships.
4. Improve Your Credit Score Before Taking Out an Auto Loan
Next, if you want to learn how to buy a car more cost-effectively, take a look at your credit score. If you have poor or limited credit, your car loan is going to come with a higher interest rate. Over time, a higher interest rate will add thousands of dollars to your overall payments.
Spending some time before buying a car to improve your credit score can save you a substantial amount of money in the long run.
5. Give Yourself a Budget and Stick to It
Finally, when looking at cars for sale, determine the most appropriate budget based on your financial circumstances. More importantly, commit yourself to that budget. Don’t let pushy salespeople or flashy features persuade you to compromise.
Shopping within your means is one of the most important car buying tips. If you stretch yourself too thin, you won’t have money for things like fuel, vehicle maintenance and repairs, car insurance, and vehicle registration.
Looking for More Car Buying Tips?
If you’re planning on investing in a new car, take our car buying tips to heart. By following the advice above, you can save a lot of money and make a decision you won’t come to regret.
And if you’re looking for more insight into the car buying process or want to learn more about finances, don’t go anywhere. Look through some of our other blog articles to find more relevant content and helpful information. Our website was created to help people like you.