Online calculator to help you decide on a house or car within your budget
These simple tips will help you figure out your budget if you’re looking to buy a home or car.
problem solved
- Buying a car shouldn’t be a quick process. One expert says it will likely take more than a month to decide on the best choice.
- Your personal life stage and budget are key when determining your needs and wants when purchasing a new car.
Finding the right car doesn’t have to involve the kind of quest memorialized in a song.
But it shouldn’t be as easy as choosing a shirt to wear to your weekly bowling night.
After all, buying a car is usually the most important financial commitment for many Americans, second only to their mortgage.
One important consideration is how to choose the right car for your lifestyle.
needs and wants
Karl Brauer, executive analyst at iSeeCars.com, has a number one rule for car buyers. It’s about first considering your needs, then what you want. Of course, your results will vary depending on your life stage and budget.
Many two-car families have one car for one purpose and a second car that performs functions that the first car doesn’t, such as a small car for commuting or an SUV for the family’s needs. But many shoppers fall into the trap of thinking they’re shopping based on their needs, when in fact they’re buying what they want, Brauer said.
A new Corvette may be your dream car, but it may not meet the needs of someone with a family and a limited budget. But if you have the money, that may not be a concern.
“If they’re buying a third car for fun and they have a pretty high budget, they should go for a car that’s a lot of fun and probably not worry too much about value or how to get the most bang for their buck,” Brauer said, perhaps not a typical experience, noting what he described as an aspirational case.
Examples to consider
Urban dwellers, rural dwellers, and people with families likely have specific needs when it comes to transportation.
If you live in a city, regularly commute at low speeds, and have limited parking options, a smaller car, perhaps a plug-in hybrid or electric vehicle, may be a good choice, Brauer said.
At the other extreme, if you live in rural Wyoming, your commute is 80 miles each way, and you need to haul materials or make regular deliveries. Brauer said these situations likely require a larger vehicle that is comfortable, has plenty of space, can handle inclement weather and has the ability to travel long distances to refuel.
Regular rather than occasional needs
However, be realistic about how often you will need a particular type of vehicle. Sean Tucker, managing editor of Kelley Blue Book, said:
“Buy the car you need for 50 weeks a year and rent the car you need for two weeks a year,” Tucker said.
The biggest mistake people make, Tucker says, is thinking they need something for a rare occasion.
“They say, ‘Mom and dad are coming on vacation and we need three rows of seats.'” No, that’s not the case. It’s also $15,000. You can also rent a three-row car twice a year and buy something more reasonable,” he said.
It’s the same idea that motivates many pickup buyers who only occasionally need to haul cargo.
“Vehicles can also be rented for more extreme needs,” Tucker said.
Traps to avoid
Brauer said he often hears stories of people going to the dealership and falling in love with a particular car. He says dealers are feeding off of that.
“Dealers are masters at presenting you with a car you’re hooked on and recognizing when it’s happened,” Brauer said.
Car buyers who react emotionally instead of thinking rationally are easy targets, especially when dealers want to move products out of showrooms to make room for new models.
“If a dealer seems very keen to sell a certain model, or even a certain type of model, at their dealership, it might not be because it’s the best car for you. It might be because for some reason that clears a lot of the cars they want to clear, so it might be the best car for them,” Brauer said.
How to prepare
Brauer said you should never rush into buying a car.
He says a month or so is a good minimum time to buy for people who are actively researching potential options. A couple of months of casual consideration may be enough.
Brauer advised potential buyers to start researching online, checking reviews and prices, and considering which vehicles have the best ratings and features they like. Create a list of 3-4 vehicles on the low end, 7-8 vehicles on the high end, and eventually reduce it to a few.
He also suggested car shoppers arrange financing through a bank or credit union before going to multiple dealerships.
Finally, Brauer wants to remind potential car buyers just how much power they have. That’s what many people forget.
“Please make it clear to (the salesperson) that you better treat me right or someone else is going to get my tens of thousands of dollars,” Brauer said.
The money that a dealer or salesperson is willing to part with you gives you a lot of leverage in negotiations as a car buyer, he said.
Contact Eric D. Lawrence at elawrence@freepress.com. Become a subscriber. Submit a letter to the editor at freep.com/letters.
