A nice new car in the driveway is every man’s dream. It’s easy to picture the shiny exterior, clean, white tires, and terrific body. Any man can imagine backing onto the street and tooting his horn as he says goodbye to the family, grateful to be inside this dream come true.
Of course, cars cost money. Saving money on a car means you have to start by trying to understand what kind of prices you’ll find at the dealers. The first price, MSRP, stands for manufacturer’s suggested retail price. It’s not the lowest price a dealer can provide. It’s only a guide to the fair markup on the car. It’s issued for the whole car and for each option that comes with it. The MSRP tells you the most you ought to pay, not the least.
After the MSRP, you find the invoice price. It’s not really the price the dealer paid for the car. It doesn’t include rebates or discounts the dealer received. A luxury car will cost more than an economy car. If you’re buying a BMW, you may find the invoice price is thousands higher than what the dealer got charged. For a Honda the invoice price would be lower.
If you want to buy a car with all the perks, you’ll find out it will cost you. You might want to limit your options to the mechanical kind. Air conditioning and power windows are better purchased from the dealer. It will be cheaper than having an outside party install them later. At the same time, you can buy stereos and exhaust systems for less from an outside source.
When it comes time to talk with the dealer, negotiate your price, not your monthly payments. Most sales staff will want to discuss payments. They think if they can stretch out the payments that can make it look like the monthly statement is a real steal. When you add up the monthly price and get the overall vehicle price, you find out you’re paying more than the MSRP for the vehicle.
You can probably get the best price for your old car if you use it as a trade in. It can also help you negotiate the price of the new vehicle. Consider this carefully. You won’t get a lot more money selling it to the kid down the street.
When it comes time to make the deal, you want to have a substantial down payment. This will save you thousands of dollars in financing and interest. A salesman will be eager to talk to you and make a deal. Have a price in mind before you show up. Let the dealer know you’re ready to buy if they can make a good offer. If you’re ready to buy, that will get you a lower price.
This is a great time to buy a car because no one is buying cars. You can find a terrific deal. So get out there and make your dream come true. Soon you’ll be cruising to paradise and you’ll have yourself to thank for making your dreams come true.