While buying a car can be exciting, it can also be a stressful process. Next to buying a home and paying for higher education, purchasing a car will be one of the largest purchases that most people ever make. Though a car may be expensive, there are steps that you can take to save money on your purchase without giving up what you want in a car.
- Look at both new and used cars. If you are purchasing a second or third car for your family, you can save money on both the car and the cost to insure it by purchasing a used car. Many car manufacturers offer certified pre-owned cars that carry a manufacturer warranty while being sold for a fraction of the price of a new car.
- Carefully select the features you need in the car that you want to buy. Many safety and comfort features are standard on car models. Passing on options such as the navigation system and alloy wheels can reduce the cost of your car.
- Check the incentives that are available from dealers. You can save money by using cash back incentives or low interest rate loans. A dealer may offer you your choice of incentives, so you may need to determine which incentive offers you the greatest savings when you purchase a car (see Resources below).
- Explore your financing options. Auto dealers are not the only place where you can secure a car loan. You may find better terms for your loan from a bank.
- Visit car dealerships toward the end of the month. Salesmen have sales targets that they need to meet. If the salesman has not yet met his sales goal, you may be in a stronger negotiating position.
Tips & Warnings
- If you are purchasing a new car and do not see a car with the options you want on the lot, the dealer may be able to order it for you or find it at another dealer. Before you purchase a more expensive model on the lot, find out how long you would need to wait for the model that you want.
- Avoid taking out a long term car loan. Though a long term loan may offer smaller payments, letting you purchase a more expensive car, you will pay significantly more in interest. In the future, you may end up owing more than the car is worth.