Tips For Car Buyers

To be successful financially, you have to show some motivation and independent thinking. This includes the decisions you make regarding the type of vehicle you drive and some intelligent decisions you make regarding that choice. You can make a “wheel” difference to your net worth just by understanding how to make a cost effective choice regarding your means of transportation.

Your Purpose-Driven Car

Choosing a car does not have to take on the significance of a religious decision, but you should seriously consider why you think you need a car, if at all. If you cannot do without a car, it is sensible to be wise to the salespeople who will appeal to your desire for a status symbol. Choosing a car to look good will undoubtedly cost you in the long run.

Drive Vs. Alternative Arrive

According to the AAA’s study, “Your Driving Costs” (2006) it costs, on average, $8,000 a year to own a motor vehicle. The cost is higher for SUVs and minivans. It can be double that if you choose to update your luxury car every two to three years. These figures were calculated based on the car travelling 15,000 miles per year.

Think about it - do you really need a car so much that you are willing to spend such a hugh sum, when you can save thousands by car pooling or using public transport? This amount of savings would take into account the times you may need to call for a taxi or rent a car in absolute emergencies. If you are able to, it is also a great cost saving, as a new family previously on two incomes, to cut back to one car and therefore live on one income.

Why do cars costs so much? After all, there are all those ads that claim it only costs $299 per month! What they don’t tell you about are the high deposits required, or the sales tax, or the fact that the loan is over such a long period of time that what you are left with when you have finally paid the last instalment is a car that is not worth much at all because of depreciation. They also don’t mention the cost of fuel, maintenance, or insurance that has to be added to the cost of owning a car.

New Vs. Used:

It is mostly the case that a fancy new car with all the extras will cost you more than a late model used car. The new car will depreciate at a very fast rate. The used car has already gone through the worst of its depreciation and it will cost you around one third of the price of a new car. There is also the problem that a completely new model of car could have some unforeseen problems; it does not have any reliability records, so you don’t know what you are buying, nor do you know the potential repair costs.

One positive about purchasing a new car is the extended warranty period, which may balance out the cost of a new car against that of a used car, when you don’t know its service history.

Insurance

The most attractive cars attract the highest insurance premiums due to their desirability amongst thieves and they often cost more to repair. One example is that the humble Honda Accord that has an insurance premium around 20% less than the more desirable Acura.

SUVs usually cost more to insure as well because their repair costs are higher. It is usually the case that a late model used car will cost 10% less to insure than the same car when new.

Use, Convenience and Safety

For a number of people in high-powered positions, such as consultants or entrepreneurs who need to transport clients, their car can be seen as an extension of their “image”. Paying extra for the appearance and the added features of such a car may be considered a worthy investment. In some cases, a SUV may be justified, especially if you are required to transport clients and their luggage around.

When choosing a SUV, keep in mind that, whilst some of the “crossover” models have improved, more “car-like” handling, many still have problems with fuel efficiency and can be more prone to rolling or other accidents related to the handling of the vehicle than a standard passenger vehicle.

Should You Lease, Loan, or Fully Own?

It is a sad fact of life that, unless you are looking to purchase a true classic vehicle, your investment will depreciate. There are ways to keep the depreciation as low as possible and ways to keep the operating costs at their lowest:

Loser Leasing

At first appearance, leasing a car gives you a new asset in return for monthly payments that appear reasonable. In fact, leasing is in fact a loan on the biggest depreciating portion of the car’s life, that is, the first few years. The cycle repeats itself as you replace the old car with a new model, so you never see the benefits of reduced operating costs associated with an older vehicle.

Leasing can also be an expensive trap. Because lease contracts are far from simple, you may think that you have struck a good deal, when in fact you are paying hundreds or maybe thousands of dollars over the term of the lease that you should not have had to.

Swimming with the Loan Shark

You may find yourself in financial difficulties if you miss a payment and have to resort to extending the loan on a vehicle that is now worth less than the amount of the loan that you still owe. You may also find that the “great deal” you made with the dealer’s finance will cause you grief should you have to sell the vehicle in an attempt to repair your finances. It is better to arrange a loan with a reputable bank or credit union.

Cash In and Out on Ownership

Patience and cunning are the keys here. Researching a particular vehicle’s market value, finding the best dealers and having your possible purchase checked over mechanically before you pay cash for a fuel efficient late model used vehicle is a wise move financially. Why? Because the “middle years” of the life of a car are the least expensive when it comes to maintenance.

Paying cash for your vehicle also avoids the burden of monthly payments, which you can then put aside for the maintenance of the vehicle as well as saving some cash towards the purchase of your next (late model) car in the near future.

It is the case, though, that there are people who either don’t have the time or persistence or the ability to negotiate a deal to be able to make a successful cash transaction. The option for these people is to buy a late model vehicle that is high in quality but is not in the luxury category and simply running it until it “dies”. Yes, the maintenance costs will be higher as the car ages, but there will be no real value in the car to depreciate and as such the annual running costs will be less for the ensuing years when you can keep it going until you can buy another late model or new car.

If it is necessary for you to purchase a new car, make sure that it is as reliable and as fuel efficient as possible.

By the Light of a Silvery Moon Roof

If a new car is your option and you are going to sell it on before the maintenance costs become too high, you should ensure that you maximise the marketability of the vehicle and keep the depreciation as low as possible. Some cars depreciate very quickly, so choose carefully.

There are some “extras” that will help the vehicle maintain its value, including sun/moon roofs and better seating. Safety features such as airbags don’t, but they should be a consideration purely for their safety aspects and they will be a plus with the insurance companies and when you are ready to sell the vehicle on, they will increase the chances of someone buying the vehicle.

Drive Down Your Car Costs

There is good news and bad news. The good news is that with the advancement of safety features in vehicles, insurance costs have become lower. The bad news is that poor drivers will see their insurance premiums skyrocket - only the good drivers will see the benefits of lower premiums.

It is obvious, then, that you will save a great deal of money when you have worked out these skills:

When you are in the process of negotiating a new lease or purchase, don’t fall prey to the what is listed in “special extras” of many car companies, for example, extended warranty periods. You might be paying more on what are not necessary. Paying for extras might affect your credit report rating.

Do your homework regarding the reasonable price of a good used car, so you know where you stand, whether you are buying from a dealer or privately.

Find the best mechanics that will give you the best deal.

Go for a more fuel efficient vehicle and one that is reliable, but be wary of the hybrid claims as they are often much more expensive to purchase initially and their repair costs are higher.

Make sure that your insurance cover meets all of your needs.

Why You Should Get Multiple Quotes For Car Insurance

When thinking about buying car insurance, it is important to look at all your options and get more than one quote so that you can see what else is available in the market. Without doing this step you might not be getting all of what you paid for or you might just be wasting your money in general.

There are various types of car insurance and car insurance companions out there wanting your business. The rates and quotes vary from each one but because auto insurance companies have good marketing skills, they can easily sell high rates to their customers.

Usually they have tie up with various automobile dealers hence they could load their insurance on the customers who come to purchase a car from the showroom as a result the customer wouldn’t pay much concern about what insurance they have taken and continue paying the premiums without knowing its actual worth.

At the point at which you actually accept car insurance and begin paying it is important to understand that you might not be getting what you are paying for. Therefore it is important to check multiple companies to ensure that you are always getting the best deals on car insurance.

Using online resources, you should look at all the details between each and every company. If you find yourself with cheap car insurance, it doesnat necessarily mean that everything else is cheap as well. For example, look deeper into things like past services, claims, deductibles, and any other hidden fees.

Before buying car insurance, you should also look into the value of your car online. Depending on how valuable your car is, you can determine how much coverage your car insurance should include. So take your time and do the necessary research to make sure that you are using the best quotes you can find for your car.

California car insurance are a bit expensive hence by doing a little bit of enquiry will help you obtain a less expensive one. It is necessary to compare various quotes and select the appropriate one. You can also insure it outside california to get cheaper insurance. Think for reasons of why you should get multiple quotes for car insurance and then select the most apt auto insurance.

So please, it can not be stressed enough, shop around for different car insurance quotes when you are buying a car. You definitely do not want to be stuck in a long term contract paying prices that are much higher than your car is worth or higher than you can afford. Hard earned money is not always easy to get, so donat waste it.

Learning How To Submit An Insurance Claim

Do not feel left out if you have never submitted an insurance claim. It is not one of the easiest things to do. Just like most of us out there, your day will come when you will have to deal with an insurance company regarding a claim. Listed below is a step-by-step guide to help you through your first insurance claim experience.

To back up a step, there is one essential step you must take before you ever get to the point of submitting a car insurance claim. Itas of key importance to first get a cheap car insurance quote and to buy the insurance policy (preferably a cheap car insurance policy).

So, with your new policy in your glove compartment, and your insurance companies card with your insurance agents name on it in your wallet you head out on the wide open road. Of course you are driving carefully right? Wouldnat want to cause an accident and have your premiums go up.

You are sitting at a stop light thinking about how you need to stop by the drug store on the way home but your too tired, another car slams into the back of you. You are disoriented but ok. First things first, you call the police. With the way the other person is mugging you can tell this is not the first thing they wanted to do. A word of advice though, insurance companies are much easier to deal with when the accident is not your fault and you have a police report saying so.

Say the accident was your fault and you slammed into someone elses new car with your beat up beauty. Of course you didnat mean to, and boy wouldnat it be nice if we just went our separate ways, it doesnat look that bad right? I doubt the other person feels the same and the cops are on their way.

So the sometimes nice sometimes not police officer shows up. After this happens you will be able to move your cars out of the way of traffic. He will most likely ask you a series of questions and ask for proof of insurance as well as your drivers license. Pray everything is up to date on your car.

Once you are given the go head you head home, or to moms to cry on someones shoulder. You get out the card that your insurance agent gave you and call him. Be prepared to wait a while, put in your favorite movie. No I am not kidding unfortunately.

A representative from the company will eventually make their way to your call. Asking you the same questions the police did. Yes you have to tell the story all over again. You will want to give them a police report when you get it. You will want to know the details of your policy. If you donat they can help you with that. They can also help you find an adjuster or a body shop if needed. You should feel lucky; you made it out of the crash alive and also through your first claim. Congratulations.