Skip to site content
The Show

Car Buying Tips and Tricks

This week we break down the car buying process to give you some helpful tips when purchasing or leasing a car. Over the years we have developed a system for helping clients buy cars.  So, we have decided to give you a behind the scenes peak at the Money-Guy’s best practices for car purchases.

Finding the right car for you

Buying a car is like Cinderella and the glass slipper; you have to find the car that fits your wants, needs and styles. The first step is to define what the car is going accomplish for you, so, Brian came up with these automobile personalities:

  • The Money Master: Drives a car for at least 10 years, someone who might like to have more features or a newer car but likes not having a car payment even more. 
  • The George Jefferson: Is the type of person that prefers to trade their car in every two to three years to keep up with the latest and greatest or as a social indicator.
  • The Drive the Wheels Off: Someone who is putting tons of miles a year on the car and it is most practical for them to keep their cars as long as possible.

Three components to buying a car:

  1. Ownership: The difference between purchasing a car and leasing. Just remember, when leasing, your payments do not build equity.
  2. Depreciation: The downside of purchasing a car. The old saying is, “A new car loses 20-30% of its value the minute you drive it off the lot.”
  3. Interest: The cost of borrowing money when buying a car. The lower the interest rate, the less you pay extra over the life of the auto loan.

Buying New:

Buying new makes the most sense for “The Money Master” personality.

  • Know exactly what you want.
    • Build the car online from the manufacturer’s website and then go test drive it.
  • Do not negotiate in person.
    • Negotiate over the phone to eliminate the theater (pictures of the family, uncomfortable pauses, etc…).
  • Get an understanding of the market.
    • Research process
      • Edmunds.com – Check out the forum: “Prices paid and buying experience.” Take note of what part of the country the cars are selling cheapest for. Use those zip codes when doing online searches to find the cheapest deals.
      • Consumer Reports – After researching the car on Edmunds we like to go to Consumer Reports to price the car exactly the way you want. This gives the opportunity to compare the prices locally against the prices of the zip codes you found during your research. Once you find the lowest price use it as the starting point of your negotiations.
    • Inventory
      • Go to the websites of your local dealerships and shop their inventory for comparison shopping, find the cheapest dealership around you and start your negotiations.
    • Negotiating
      • Do not go there in person to negotiate, call them up or negotiate online with the online sales representative. It is much easier to negotiate on the phone or online.

Buying used:

The easiest way to lower the negative impact that car buying has on your cash flow. It makes sense to buy used if you fall into the “Drive the Wheels Off” category.

Leasing:

Leasing is basically a long-term rental. When you lease, the car company and dealership have to “guess” what the value of the car will be when you return your long-term rental. If they put a high value on the return you are better off because the rent will be lower. It makes sense to lease certain luxury brands that do not offer large discounts on purchases or if you fit into the “George Jefferson” personality.

Enjoy the Show?

Where You Can Watch and Listen:

Subscribe on these platforms or wherever you listen to podcasts for new episodes every Friday, live streams every Tuesday at 10am CT, and new highlight clips throughout the week.

Related Content

Free Resources

Financial Order of Operations®: Maximize Your Army of Dollar Bills!

Here are the 9 steps you’ve been waiting for Building wealth is simple when you know what to do and…

View Resource

Car Buying Checklist

Here’s how to buy a dependable car that won’t break the bank.

View Resource

Tax Guide 2023

Updated for 2023! Ever wonder what the highly trained professionals use to tax plan? Wonder no more! We’ve assembled the…

View Resource

Articles

Buying a House – Money Guy’s Ultimate Guide To Your Biggest Purchase

, , , , , , ,

Read More

Why Forecasting the Future of Inflation (and Interest Rates) Is So Difficult

, ,

Read More

Is a High Yield Savings Account Still the Best Place to Keep an Emergency Fund?

, ,

Read More

Financial FAQs

Courses & Tools

How about more sense and more money?

Check for blindspots and shift into the financial fast-lane. Join a community of like minded Financial Mutants as we accelerate our wealth building process and have fun while doing it.

https://moneyguy.com/wp-content/uploads/2023/10/accent-icon-book.png

Millionaire Mission (Brian’s Book)

Buy Now
https://moneyguy.com/wp-content/uploads/2023/10/accent-icon-math.png

Know Your Number Course

Buy Now
https://moneyguy.com/wp-content/uploads/2023/10/accent-icon-pencil.png

The Money Guy Net Worth Tool

Buy Now

Recent Episodes

It's like finding some change in the couch cushions.

Watch or listen every week to learn and apply financial strategies to grow your wealth and live your best life.

FULL WhyAmericansAreBroke A

Why Americans Are Actually Broke! (2024 Edition)

Watch Now
maxresdefault 3

Is the Economy DOOMED? (And What to Do About It)

Watch Now
FULL AreYouOnTheMilllionaireTrack A

Are You On Track to Becoming a Multi-Millionaire? (Don’t Miss These Important Milestones!)

Watch Now