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Owning a car is becoming more of a necessity in every day life. This post will show you what to consider when buying a car and how to do so on a budget.
4 Things to Consider When Buying Your First Car
New vehicles are one of the worst investments.
Buying a used car can help you lower prices even if it only has a few miles on it. There are plenty of used cars that are still in fairly good condition. You have probably heard this to death, but driving a brand new car off the dealership lot instantly depreciates its value by about 10%. Do not buy a brand new car when you can find a used version of it for a better price. Also, you need to spend below your means. Making $500 monthly payments on the new Nissan 350z doesn’t make sense when you make $600 a month.
Buy a new one when really you can afford it.
Dealerships make money from commission and branding fee.
You can also buy your first car on an online listing or from someone you know. Buying a used car from a private seller can help you and the seller save on “middle man” aka dealership fees. Just be sure to know what you are buying or bring a friend familiar with cars to point out all the flaws of the vehicle. You can save a lot of money this way just by cutting out the middle man.
Bypass the middle man, go direct.
Cost of Ownership
Be careful of cars with high maintenance costs.
Operating costs such as insurance, gas mileage, car maintenance, and parts add onto the total cost of owning a car. Many of us are guilty of just looking at the initial price without considering the additional costs. This oversight leads to unexpected expenses that can put you in debt.
The most expensive car you can buy is the one you don’t research.
Aren’t you going to sell the car in future, too?
Are you planning to keep the car for as long as you can, or are you planning to sell the car in the future? Although the car depreciates in value, you can still sell it to pay for a car upgrade. Luxury cars are notorious in depreciation so stay away from those. Try to buy reliable cars that are known to keep its resale value.
Buying a car is an investment. Research.