Over the years, Money Under 30 has written a fair amount about many people’s second-biggest expense (after housing): our cars. We either love them or love to hate them, but either way, we spend a lot of money on them. We’ve put together this car buying guide to help you navigate the process of buying (or selling) you’re next new-to-you car.
From my brief stint as a car salesman, here’s what I know about buying a car wisely.
Negotiate your price via phone or e-mail. Do your test driving first. Leave the dealership. Call back the next day and negotiate a price over the phone, or better yet, follow this trick the car dealers hate to secure a rock bottom price. The dealer will hate you, but you’ll get the best price possible.
Consider buying used. Vehicles are not an investment. It’s an emotional thrill to buy a new car, but a used car is a far better value.
Finance wisely. If you have to borrow money for a new car, get a car loan the smart way. Put money down, and shop for rates! Check auto loan rates with your local bank or credit union before applying for credit at the dealership.
Sell privately if you can. Cream-puff or clunker; you can get more for your old car on the private market when you follow this advice for selling your car. Don’t be lazy, sell it yourself. If you simply can’t stomach the task, be sure to take steps to maximize how much you get for your trade in.
Skip the extras. In general, dealer extras like paint coating to warranties are not worth it. Save the cash for car washes and oil changes.
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You swerved for a skunk and wrecked your ride; now your car insurance is going to double, right? Not necessarily. With the right insurer — or some clever maneuvering — you can still save money on car insurance after an accident.
I’ve never owned a new car, and I don’t think I’m missing a thing. For starters, a new car depreciates the second you drive it off the lot. And monthly car payments, whether by lease or purchase, saddle drivers with yet another monthly expense to bear. That’s why I’ll be driving my sweet 1998 Toyota minivan to 200,000 miles and beyond.