10 Frugal Habits You Shouldn’t Use When Car Shopping

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When shopping for a car, you’ll naturally want to save money and not overpay. However, it is essential to consider all of the factors around owning a car and not look purely at the price.

You need to know which frugal habits could be detrimental to the process before you begin the hunt. 

Going for the Cheapest Vehicle

While you may want to save money by spending the least amount that you can on a vehicle, you could cost yourself more in the long run if you go for the cheapest option. Cheaper isn’t always better when it comes to your mode of transportation. 

There are numerous other factors to look into before buying a car, and price shouldn’t be the only deciding factor. You’ll want to look into safety, reliability and fuel efficiency to get a car you can have for many years. You don’t want to return to the car lot in a year or so because you chose the cheapest option. 

Not Looking Into Financing

Even if you’ve saved up the money to purchase the car in full, you still don’t want to ignore the financing options. Many dealerships offer favorable financing terms that you could take advantage of while you leave the money in a savings account, where it can grow.

For example, if you get a car loan for 6% but make 8% off your investments, that’s a 2% profit if you skip paying cash and keep your money invested.

You want to review the financing offered at the dealership and see what your bank offers so you make the best decision when it comes to getting your new set of wheels. 

Avoiding the Test Drive  

Your frugal nature may tempt you to avoid the road test because you’re unsure it’s worth the time. Even though frugality is often about efficiency, you shouldn’t skip the test drive. You want to see how the vehicle moves around on the roads so you don’t regret purchasing it. 

Not Buying New

Even though you can save money by purchasing an older vehicle, this doesn’t mean you shouldn’t consider buying a new one. Sometimes, you’re better off spending the money on a new car because it comes with an extended warranty and gets better gas mileage — and you have the comfort of knowing you can get plenty of use out of it.

You don’t want to be stuck with a used vehicle that requires frequent maintenance and repairs. That new vehicle could also have features that make your drive more enjoyable. 

Saving Money on the Vehicle Inspection

If you’re purchasing a used vehicle, you may want to spend the money on an inspection by a quality mechanic. Even though this will cost you money, you can save on future headaches since you want to ensure that you’re buying a reliable vehicle that you can get decent use out of. 

A $300 inspection might save you from buying a car that might need a new $3,000 engine.

Ignoring Insurance Costs

Every type of vehicle has different insurance rates, so you’ll want to consider your future insurance expenses before purchasing. Your frugal nature may lead you to focus only on the car’s price, but you could spend more on insurance in the future. This is why you need to run the numbers to see how different cars stack up when it comes to insurance rates. 

Not Looking at the Future Resale Value

Your frugality may lead you to purchase the cheapest vehicle you can find, but you can’t forget the importance of the future resale value. When making long-term financial decisions, you want to think about depreciation and the resale value of your vehicle.

While another vehicle could cost you more today, it might maintain value in the long run, making it the better choice. 

Not Factoring Future Maintenance Costs

As you’re trying to find the best deal, you could easily overlook that the vehicle will require extensive maintenance. You’ll also want to research how much parts and labor cost for the vehicle you’re planning on buying.

You don’t want to save money today only to find out that you are going to have to pay more for repairs tomorrow. 

Ignoring Your Future Needs

When you buy a vehicle, you want to think about your long-term goals and future needs. While you may want to save money on this car at this time, you need to consider whether it will be the right vehicle for you in a year or two.

Maybe you plan to start a family soon and will need a bigger car.

If you plan on driving the car for many years, you also will want to consider your future living plans. For example, if you know that you’re going to move in the next year, you may need a different type of vehicle for the area where you plan to reside. 

You might want to pay a little more for a car that drives better in inclement weather.

Not Doing Enough Research

If you want to limit the amount of time you spend on researching your vehicle purchase, this could hurt your final decision. You’re going to want to take the time to research everything from different types of vehicles to financing options.

If you plan on holding on to this car for the next five years, you’ll want to spend the time and energy on research. 

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