For most Americans, having a car is a necessity — even during a pandemic. But while driving your own vehicle can represent freedom, it can also represent significant costs. We might not be able to control the price of gas, but we can often save a bit of money on the purchase price of the vehicle itself. If you’re planning on purchasing a car in the near future, here are just a few ways that can help keep costs a little lower.
Pick the Right Time
Ideally, you won’t want to wait until your current car is on its last legs before you decide to buy. For one thing, this can limit your ability to trade in your current vehicle. But it can also cause you to settle for a higher price out of sheer desperation. If at all possible, start shopping for a new car before you really have to.
This can allow you to pick the best time to buy. Contrary to what you might think, there are certain times of the year that may yield lower prices. You might consider shopping at the end of the model year. This doesn’t always take place at the end of the calendar year; next year’s models might start to arrive at a dealership as early as summer. This will vary by maker and dealer, however. You might also be able to score a deal at the end of a calendar month or the end of a quarter, as some auto dealers may be under the gun to make their quota. Look out for holiday sales events, as well. Interestingly, some experts say that going to the lot on a Monday might allow you to get a better deal from a salesperson because they’ll have more time to devote to you. Generally speaking, you’ll want to avoid going to a dealership at the beginning of the month and on Saturdays, when lots are at their busiest.
Choose a Model in Ample Supply
When you buy matters, but so does what you buy. It’s a good idea to look at any models that are being discontinued, as this can allow you to negotiate and get an even better deal. Resources like Consumer Reports can also let you know about commonly discounted models that may be selling below their sticker price. Thanks to the pandemic, there were a number of 2020 “leftovers” that didn’t sell. Right now is actually a great time to buy those models at a lower price, as the end-of-the-year rush wasn’t nearly as pronounced in December. Many dealerships have those 2020 models left on the lot and are motivated to sell them. Pandemic notwithstanding, however, you’ll want to look for cars that come with lower demand and a higher supply. With something like a 1964 Mark II, which had only 538 total models built, you’d theoretically pay a higher price due to its scarcity. But if you pick a model that’s prevalent, you’ll be in a better position to negotiate a deal.
Secure Financing Beforehand
Around 50% of Americans have less than $10,000 saved in their bank accounts, which means that most car buyers will need to secure some type of financing. The dealerships know that — and they’re counting on you needing them for financing help. This is where they actually make a lot of their money. But you’ll have the upper hand if you come in pre-approved with financing already secured. You don’t need to tell them this upfront (in fact, it’s often better if you keep that to yourself at first), but it’s good to have in your back pocket. Being pre-approved allows you to bypass the interest rate markup that a dealership will put on a loan, which will save you money.
Buy Used When Possible
Although 80% of homes in the US are more than 20 years old, you probably won’t want to buy a car that’s been around for two decades. Still, you may want to consider a used car over a brand new model if your aim is to save. While a brand new model is no doubt tempting, there may not actually be that much difference between a 2021 model and a 2018 model of the same vehicle — other than the price. You could pay significantly less for a car that’s essentially the same if you opt for a certified pre-owned option. As long as the car hasn’t had any major repairs and has the safety features you want, it really is better to consider a used car in this scenario. Since a new vehicle will immediately depreciate in value as soon as you drive it off the lot, you can avoid some of those losses by choosing a high-quality used car from a reputable dealer.
Skip the Extras
A dealership may offer to create the car of your dreams for you, but you’re going to pay a pretty penny for customization and upgrades. Unless there’s a feature that’s non-negotiable and it’s unavailable in the model you want, it’s best to compromise when possible. Your car is never going to have every single feature you could ever want — especially not for an affordable price. Before you visit the dealership, determine what you truly need versus what would be nice to have. Do some research to assess whether those must-haves are common or even possible with the model you’re after to avoid disappointment or sticker shock. Even dealership-provided maintenance warranties may not be necessary. They’ll likely try to sell you on them, but you should go in knowing what’s truly vital and what isn’t worth the money.
Certainly, a car is going to be one of the most expensive purchases you’ll ever make. But that doesn’t mean you have to accept high costs outright. With these tips in mind, you can save some money and still secure a vehicle that will serve all of your needs.
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