Buying a new vehicle requires a lot of preparation and a lot of time. The amount of money invested is important and it is not easy to change our mind after the sale is concluded if we find ourselves with a vehicle that does not suit our needs or is too expensive. So here are some mistakes to avoid in order to make sure that you are buying the right vehicle for you.
Stretching your budget
It’s easy to stretch your budget when buying a new vehicle. A difference of $5,000 on the sale price seems huge, but once you have leased or financed a vehicle, the difference may be only $100 per month. Many fall into that trap but the reality is that this $100 can also be huge once we take into account the other costs associated with owning a car.
Sometimes, some buyers stretch their budget to buy a luxury car without thinking that it will cost a lot more to service and insure. So, try and set a budget before you go into the dealership, and make sure you leave yourself some financial leeway.
Not thinking about future needs
Our immediate needs are likely to change over the next few years. That flashy sports car that we love today could quickly turn into a nightmare if we start a family in a few years. To avoid having to change vehicles too quickly and thus lose money due to depreciation, try to evaluate how your needs will evolve over the next few years.
Buying a vehicle with a low resale value
Many buyers do not look at the historical resale value and depreciation of a vehicle they are thinking of buying. This information is easy to find, and can help you to not lose too much money when replacing your vehicle.
Buying a new vehicle before they done paying the one they currently own
It is never good to add a residual balance of a previous vehicle to a new vehicle, no matter what offer you are presented. Your next vehicle will end up being worth a lot less than the total amount you owe, and it will take you that much longer to pay it off and be debt free which should be your objective when it comes to your car.
Thank you to Morrey Nissan of Burnaby for their help with this article.