9 Bright Ideas to Save Money on Your Next Car Purchase

Are you in the market for a new ride? Purchasing a new vehicle—or one that’s new to you—is a financial decision that requires careful thought. Before you sign on the dotted line, get our tips to save on this major purchase.

If you find another dealer is offering something your preferred dealer is not, ask them if they will match the deal. You never know—they may do it!

1. Pay in cash—The biggest way to save money is to skip the loan completely. No loan, no interest. Paying in cash can also be a point of negotiation to get a better deal.
    
2. Do your research—Shop around and compare prices to get an idea of how much the car you’re interested in should cost. Check with dealerships, online and private sellers, and kbb.com.
    
3. Get preapproved—Meet with your financial institution and apply for financing before you do any serious shopping. If you apply for preapproval at several places, do so within a short time frame. Credit reporting differs from agency to agency but, typically, inquiries made within a 14- to 45-day window will only hit your credit score once.
    

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   Check around at the dealerships, too. Rebates and special interest rates offered by the manufacturer can really make a difference in the final cost of the vehicle.
    
4. Consider buying used—Buying a car that’s a couple of years old will likely save you thousands, allowing you to get more of the features you want at a lower price. Try our used car buying checklist to help you decide if the vehicle you are interested in is reliable.
    
5. Don’t be afraid to negotiate—Negotiating is a beneficial tactic when dealing with dealerships as well as private individuals. Paying attention to minor flaws and knowing the car’s overall value will help you save big.
   
   Another great tip is to negotiate via email. This may not save you additional money, but it can save you time and keep the pressure to a minimum. It also serves as a record of your conversation if you don’t receive what you were promised once you get to the dealership.
   
   Additionally, ask for free accessories. It’s much easier for a dealer to throw in an accessory or two rather than further discount the price of the vehicle. Ask for free oil changes, window tint, floor mats or whatever is important to you. They may just say yes!
    
6. Get the most for your trade-in—Many dealerships will happily accept trade-in vehicles. However, you’ll likely get more for your old car if you sell it yourself. Use local classifieds sites to list your car online. Find out what your car is worth by using online trade-in tools like those from Vroom or Carvana depending on your location.
   
   If you don’t want to deal with the hassle of selling your car yourself, don’t mention your trade-in until the end of your negotiations—after you’ve already agreed on a price for your new car. This way, you open the door for additional negotiations. When you’re asked if you have a trade-in, just say no or you’re not sure.
    
7. Keep the entire cost in mind—When you’re comparing vehicle costs, think apples-to-apples and consider the entire cost—finance charges, sales tax, dealership fees, gas mileage, maintenance and insurance. Use an auto loan calculator to help you get the math right!
    
8. Buy at the end—You can save a significant amount by just waiting until the end—the end of the week, the end of the month or the last few months of the year usually see plenty of markdowns.
    
9. Read the fine print—Before signing off on your new vehicle, go over all the terms and conditions listed. If you don’t, you may unknowingly agree to terms like a prepayment penalty. If you feel uncomfortable with anything in the contract, don’t be afraid to walk away.

    

Doing your homework before you buy is the best advice if you’re looking to save on your next auto loan. As an informed consumer, you’re more apt to pay a fair price and have a positive experience. Don’t forget to add your new payment into your budget. Paying on time, every time helps to keep your credit score high—which means you’ll get a better interest rate the next time you need to take out a loan!

Happy driving!