How to Buy a Car on a Budget

If you’re in the market for a new car, you’re going to want to keep a few things in mind to make sure you’re as informed as possible when starting your search. Follow these steps to make sure that your car-buying process is as smooth and fun as possible.

1. Establish your budget. You should go into your search knowing how much you are willing to spend on a car. Generally speaking, your car payment should be around 10% of your monthly income. Spending much more than that can get a little financially dicey, so make sure you do the math and are aware of what you can realistically afford. Many people think that taking out a car loan or going into debt is ok for a new car, but that can have strong negative repercussions down the line. Rather than spending money you don’t have, keep to a budget that works within your current financial situation. Future you will be very grateful.

2. Choose a car that matches your needs. As you travel around town, a few cars are bound to catch your eye. Maybe you’re in the market for an action-ready crossover. Maybe it’s an eye-catching luxury sedan you’re craving. You should also be aware of the features different makes and models offer. Features like all wheel drive, or hybrid engines, are the kinds of details you should pay attention to when choosing your car. Buying a car can certainly be stressful, but shopping for them can actually be pretty fun once you get a feel for your tastes and what features you’re into.

3. Know where to buy. Get ten people in a room and you’ll find out ten different ways and places to buy a car. So how do you know where to look? Well, that will depend largely on your budget. If you’re tight on cash, looking for deals on Craigslist or a similar sight might be a good option – just be careful, as you’ll need to know a thing or two about cars (or bring a friend who does) to make sure you’re not stuck with a lemon. Even if you’re perfectly able to buy a new car full price, there are still some important tips to follow: for instance, buying a car in a smaller town, like an Audi dealership near Kirkland, might offer a better deal than one in a big city, like Seattle.

4. Sort out your payment plan. Dealerships will often offer their own in-house payment plans – but don’t be so quick to accept the first offer you hear. Getting a loan from your bank or credit union can be a much smarter move. That’s because they are more likely to offer you a better deal, but also because having that better deal in-hand when you walk into the dealership will give you leverage in negotiating. Overall, just be sure that you have the best interest rate you can when you walk onto the lot.

5. Keep in mind the extra costs associated with your car. The price tag you see in the car lot is, of course, not the end of the story. You’ll have to make sure that you are aware of the maintenance costs for your make and model, how often it’s likely to need that maintenance, and other important stats like its highway and city MPG. Sometimes buying a cheap car can lead to continuous and onerous costs down the road, so make sure you’re using an online tool like Kelley Blue Book to price-check cars’ likely extra costs. This is also a good place to check the resale value of your new car, which is definitely something you should always consider.

6. Be clear and straightforward. It’s very possible that a salesperson will try to upsell you or push you toward the upper end of your budget – that’s their job, after all! Try to remain as confident and clear as possible about your desires and limitations. It can be easy to get swept up in the excitement and nerves of car-buying, but don’t let that get in the way of remaining true to your financial goals.

It’s true that buying a new car can be difficult and stressful, but being well-informed and buying from a reputable dealership can make the process much easier. Make sure that you keep your budget, your must-have features, and your style preferences in mind.

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