Nowadays, there are plenty of cars on the market. Because of the different models available, finding one may be a struggle — especially for first time car owners. As always, there are numerous factors to consider when purchasing a new car, and you’ll have to account for all of them in order to find the perfect car for you. However if you have a tight budget, this constraint may actually be more of a godsend, by limiting your options and making your choice somewhat easier. Despite these advantages though, you’ll likely also benefit from following these tips so you don’t end up overspending on your car purchase:
Tip #1: Create a household budget
If you’ll be getting a car loan, it’s extremely important to assess how much your monthly expenditures will be. You can start by making a list of everything you need to pay each month — your rent, cell phone bills, groceries and everything else. Once you have assembled these items on paper, you’ll have a much clearer idea of the amount you have left after the monthly expenses have been taken care of. By determining this, you know what a safe amount will be so you can afford a car that will not be too much of a burden to pay every month.
Tip #2: Look for a car based on what you can afford
After following the first tip, you should have a pretty solid idea of how much money you can spare every month to pay for a car loan. The next step, however, involves the actual car hunt. While it may be tempting to pick out a model based on its looks and speed, this is decidedly not the best way to choose a car to invest in.
Instead, you’ll need to make another list based on your wants and needs in a car model. Don’t forget to indicate features that you feel are a must on your needs list, including the number of passengers that can be accommodated, type of transmission, gas mileage, and much more. On your wants list, you can put down the features that you wish your car could have, but would still be OK with if they weren’t available.
Apart from listing the features you need on a potential car model, you’ll also need to know its resale value and the cost of ownership. You may think that your monthly car loan payment is all that you will need to spend on, but it actually involves a lot more—fuel, taxes, insurance, and more. As for the car’s resale value, it will cost less the moment you drive it off a car lot. While a car may make your life a lot better, it should not be considered as an investment. Its value simply does not grow over time. This is why you shouldn’t pick out a car just because it looks pretty and drives really well.
Tip #3: Learn to say no
Car salesmen and dealers will always try to buyers to look at models that have a higher value and price tag. It’s their job to gain a high volume of sales on what they are selling. Once you learn the value of the car they offer, you can decline it right away. After knowing these two tips, you already have an idea of how much your budget for a new car could be. There is no reason why you should burden yourself by getting something beyond it. Instead, the best you can do is just say, “No!” to the car model they offer — especially if it has a price tag that will cost you an arm and leg.
Remember that dealers will always try to sell you a car more than you can afford. The important thing is that you know how to say no to them and be firm with your decision. After all, spending more than your budget allows will only make them richer, leaving you to worry about the extra money you spent. Keep your budget in mind whenever you look for a car to purchase so that you won’t have to overspend.
Written by Marc Laferierre, owner of Dents Unlimited. Dents Unlimited offers the best auto repair Columbia MO has to offer, where their expert staff can get your car back on the road in no time.