Choosing your dream car
Where do you begin choosing a car?
Decide what you want in a car. Create a checklist of ‘must have’, ‘nice to have’ and ‘not important’ features. This makes it easier to identify the cars that best meet your needs and takes the emotion out of your purchase.
What should you look for when buying a new car?
First and foremost, does the car meet your criteria? It doesn’t have to meet every single one of your requirements but it should possess all your ‘must have’ features.
Don’t be tempted by deals that appear too good to refuse. If the car does not have your ‘must have’ features, chances are you will be selling it within a year - at a loss.
Buying a new car is less risky than purchasing a used car as you are protected by the manufacturer’s warranty. However, there are still some things you should make yourself aware of:
- the total cost of the car. Ask the dealer for the drive-away price as this will include statutory (registration, stamp duty, number plates and compulsory third party insurance) and dealer delivery charges;
- servicing intervals and costs. In order to maintain the value of your car, you should have it serviced at the intervals recommended by the manufacturer. However, servicing can get expensive so make sure you know what you are up for in terms of frequency and cost; and
- after sales service. Some dealerships will offer courtesy cars / taxis when you bring your car in for servicing. Others will offer you roadside assistance (if your car breaks down). Make sure you know what you are getting and don’t be afraid to ask for more. They can only say no, right?
What about buying a used car?
Buying a used car is more risky than a buying a new one, however, if you follow these simple rules (in addition to those mentioned above), that risk is minimized:
- what is the history of the car. A well-loved and cared-for car will have its service history and original manuals etc;
- what is the condition of the car. Do an inspection yourself of the car, inside and out, and note any defects (you can use these as a bargaining tool for a lower price);
- drive the car. It sounds simple but you’d be surprised at how many people will buy a car without having driven it first; and
- most importantly, spend the money to get an inspection done on the car. $200 may sound like a lot but it is nothing compared to what you might have to pay if you buy a car that is not up to scratch.
What online options are available?
There are numerous websites where you can view new and used cars for sale and contact sellers.
Some of these sites also offer objective reviews on a range of cars. If you are thinking of buying a car, read these reviews so that you know both the pros and cons of the car.
What unexpected costs do you need to budget for?
Fuel costs are unpredictable so make sure that you are able to bear rising prices over time.
Your insurance premiums may increase if you have an accident, regardless of whether it is your fault or not. Make sure you allow for an increase in premiums.
How to deal with dealers
When negotiating with a dealer, don’t let your heart rule your head. Dealers thrive on the emotional investment people make in cars.
If you have selected the car that you want, contact a number of dealers and ask them for their best driveaway price. Let them know you are also negotiating with other dealers, as this will force their hand and make them more competitive.
When you have your responses from the dealers, select the ones that you think will give you the best deal. Once at the dealership, here are some tips for negotiation:
- don’t ever tell the dealer your maximum price because, odds are, the car will just happen to cost that much.
- do tell the dealer what are you are willing to pay (this is not your maximum price). Be cheeky here and go low. It’s easier to negotiate up than it is to negotiate down and, chances are, you won’t get anywhere closer to your maximum price.
- don’t get sucked in by the extras such as tinting and rain protection. These are great for your car and will help maintain its value, however you can get these services elsewhere more cheaply.