By Jason Lancaster
As a person who worked in car dealerships for nearly 10 years, I can tell you that a lot of people make expensive mistakes when buying a new or used car. Fortunately, these common mistakes are easy to avoid – here’s what you need to look out for:
Buying for an un-common need
Nearly every consumer is guilty of making this mistake at some point. People often buy a pickup truck so they can haul or tow something, buy an SUV or minivan because they want to make sure that “everyone fits” when family visits, etc. That’s all fine and good when those are common needs, but the trouble is that these are often rare uses. Why not rent a truck when you need to tow, or rent an SUV when family is in town? That way you can buy an inexpensive economy car for every day needs, and then use some of the money you saved to rent a special vehicle if and when you need it.
Buying a car without doing any planning
Before you buy your next vehicle, ask yourself what you’re going to be doing in one, two, five, and 10 years. Are you planning on children? If so, it might make sense to buy a four-door instead of that snappy little coupe. Are you moving to a snowy climate? If so, it might make sense to opt for all-wheel-drive. When you don’t make a plan and you have to trade-in your car prematurely, you lose money (sometimes a lot of money).
Negotiating a purchase on the basis of monthly payment alone
A classic car sales technique is to ask the customer to negotiate payments instead of the vehicle’s cost. Instead of lowering the price to get you a lower payment, dealers can often extend your finance term instead. You end up paying more for the car and more finance charges. So, instead of negotiating on payment alone, negotiate the total price AND payments.
Locking in on features that don’t matter
Consumers often feel that they must have a certain feature on their next car, and while it might make sense to mandate a safety or performance feature, you should never get caught up in “non-essentials.” Take color, for example. Color has nothing to do with the way a car performs, yet I’ve seen customers walk away from a big discount because the only car I had to sell them was the wrong color. The same can be said for other non-essential features like leather interior, sunroofs, stereos, etc. It’s important to get what you want, but it’s also important to get a good deal. If you’re flexible on features (especially non-essentials), you’ll always get a better deal than someone who isn’t.
Impulse buying is expensive for a lot of reasons, but the main reason is this: Car dealers know how to spot an impulse buyer and they are quick to take advantage of their emotional (and often uniformed) state.
Image courtesy of Ben McLeod