The first step in the car buying process may have the greatest impact on your overall satisfaction level with your purchase or “Lease”. Many people choose to buy a new car based on their WANTS rather than their NEEDS. It is important to Select the Right Car for you based on what is most practical for your given situation.
-
(Expert Tip) Do not spend more than 15% of your gross income or 20% of take-home pay on your vehicle’s monthly payment. Your total debt (including credit cards, rent, mortgage) should not exceed 36% of your gross income.
-
(Expert Tip) Always consider the costs for insurance, maintenance, fuel and other ownership expenses. Call your primary insurer or utilize a great company like Esurance for insurance quotes.
-
Consider your overall lifestyle including intended use, family situation, other vehicles owned, commute and even the weather conditions where you live to find a vehicle that fits best.
-
Utilize MANUFACTURER SITES, social media, Edmunds, US News and FuelEconomy.gov for cost-of-ownership, vehicle reviews, fuel economy statistics, crash-test safety results and recall information.
-
Consider award-winning vehicles from competitors within the same class. Car & Driver is a great resource to use for such information.
-
Consider popular models that have been in existence for several years. Cars in limited supply or those in huge demand will fetch premium pricing.
-
Avoid choosing your next vehicle based on manufacturer or dealer sponsored advertising (newspaper and TV ads). Find a vehicle that fits you best by using your own personal research and then investigate which incentives are available.
-
Plan to keep several months of payments in reserve to account for any unforeseen life-changing events such as losing your job.
-
Don’t take a new vehicle home unless you are 100% certain that you will buy it. Some dealerships will encourage you to take their vehicle home with only a promise to buy. If at all possible, rent the same make & model instead to get a true feel for the car without any pressured sales. A few days of experience under different driving situations will give you the knowledge to make the right choice.
-
Consider “Certified Pre-Owned” vehicles to save money. In many cases, you can even have the “Extended Warranty” and other dealer products (add-on “F&I Products”) removed allowing you to buy an inspected vehicle at an even better price.
-
Avoid buying a demo as its many disadvantages outweigh the slight pricing advantage. Demos are basically used vehicles and have a shortened warranty period.