Shopping for a new car isn’t much fun. It’s a major purchase and important decision so it’s usually a stressful experience. If you’re not careful, it can even be a costly mistake. Others are simply intimidated by high-pressure sales and don’t know how to deal with a car salesman.
Whether you’re buying new or used, it’s important to do your research before buying the car and to save as much money as possible. Thanks to the internet, saving money on your next vehicle purchase has never been easier.
10 Steps to Savings
Step 1: Determine which type of vehicle you want. Review all of the different makes and models that are available and which ones are in your budget. Consider your needs as far as size, fuel efficiency, and features. Once you have narrowed it down to two or three potential vehicles, compare each of the options in detail. Creating a spreadsheet is a great way to compare the features between different cars. Some sites will also have a comparison feature that can help.
Step 2: Do some real world research. Some Once you have done your online research and have a few models in mind, it’s time to do some real world research. Go to your local dealerships and discuss your potential cars with dealers and see which car you like the best in person. Also, taking a test drive is a great idea. Keep in mind that your intention isn’t to buy anything yet. Don’t let the salesman show you other models or talk you into looking at something you didn’t already have in mind. After you get home, compile the information you learned from your hands-on experience with the previous information which you ascertained from the web. This should help you narrow your choices down.
Step 3: Search for the best price. Once you have read all of the available reviews and have taken the potential cars out for a ride, it’s time to start looking for the best price. Use sites such as CarsDirect.com and Edmunds.com to compare the prices and to see which manufacturers are offering incentives. You can also learn the True Market Value of all vehicles. For used cars, you can also use the Kelley Blue Book to determine what the appropriate price for the vehicle is. There are several websites which you can visit to research and look for the best price. These include MyRide.com, AutoTrader.com, CarsDirect.com, eBay Motors, and many more.
Step 4: Verify your findings. After you have researched the model of the car and the various options which are available online, you can also order your potential car’s cost report from ConsumerReports which costs around $12. This data will serve to verify the data which you have previously found and it will also uncover any incentives the dealers are offering.
Step 5: The next step is to locate potential dealers (or private parties if buying used). Probably the easiest way to do this is to simply go to Google and search for “car dealers” with the location option turned on. This will typically give you a whole series of local options, show them on a map, and provide website information and phone numbers. Some dealers even have online pricing specials or coupons, so make sure you check their site before making the trip out there. Finally, don’t be afraid to look at dealers a little ways from where you live. Wouldn’t it be worth it to make a half hour drive if it saved you a thousand bucks?
Step 6: Search inventory. Most car dealers are smart enough to put their inventory online so it makes shopping easier than ever. So, after picking out the potential dealers you should be able to browse their current inventory to see what they have on the lot. This will give you a heads up as to whether or not a car with the features you want will be available or need to be ordered.
Step 7: Contact and negotiate. If they list prices right on their website, great. You already have a starting point. In some cases you will have to call or email for a quote, so do that if necessary. After a dealer comes back with a price it’s time to see if you can get it down to your price. You’re armed with all of the information you need about car values so you have some room to work. Insinuate that you have found better prices elsewhere or that their competitor across town was throwing in some extra incentives and they will often lower their prices to avoid losing any business. It is certainly possible to get a better price than what’s listed or the original quote. Use these car buying tips to make sure you avoid the biggest traps.
Step 8: Put the pressure on them. In order to make sure that you have the lowest possible price, keep trying to bring them lower. Once the bidding slows down, you should let the dealer know that you are aware of their incentives and costs and you should offer a price that will allow them to earn a few hundred dollars including incentives. The majority of dealers will accept this offer, especially towards the end of the month when a sales quota is involved. Remember, you are in control and can walk away at any time so it pays to be persistent.
Step 9: Don’t accept additional unforeseen prices. Some dealers will try to add additional charges such as advertising fees, taxes, extended car warranties, and delivery charges. Don’t let this happen. Remember, the whole reason you did all of your legwork online was to avoid all of the tricky sales tactics and the upsell, so don’t cave in at this point.
Step 10: Buy the car. Keep a record of all of your communications so that you know that the deal which you made will be honored. If they try to pull a bait and switch on you it pays to have any emails, correspondence, and printouts from their website to back your claim. And as always, read the fine print before signing anything!
Using the web to assist with your next car purchase can literally save you thousands. The worst thing you can do is just walk into a dealership without doing any research and spending hours being beaten down by a trained salesman. You’ll likely end up buying more car than you need and spending much more than you had to. Doing your research first will put you in the driver’s seat and ensure you don’t spend a penny more than you have to.
Author: Jeremy Vohwinkle
My name is Jeremy Vohwinkle, and I’ve spent a number of years working in the finance industry providing financial advice to regular investors and those participating in employer-sponsored retirement plans.