5 Questions to Ask When Looking For the Perfect Car. Image courtesy of truecar.comFor many people, buying a car is the largest, regularly occurring financial decision to affect the personal budget. Other than personal credit cards, car loans are among the most commonly accrued debt. As with any purchasing decision, particularly one that involves borrowing tens of thousands of dollars, preparation and knowledge are important. It is also important to realize that, aside from being a large financial commitment, car buying is fraught with emotional and cultural hazards that can lead to ineffective decision making and regret.In order to make the most rational and responsible decision and to avoid common mistakes, consider the following 5 questions.#1 Should I Buy a Used or New car?Should I Buy a Used or New car? Image courtesy of tripadvisor.com.The choice between new or used is largely based on your budget and preferences and should probably be based, in part, on your answers to the other four questions. A new car can have the benefits of lower maintenance costs, dealer support, in the form of warranties or included preventative maintenance, and a known history and condition at time of purchase. Additionally, new cars will have the most up to date safety features.Alternatively, a used car can be a good value since the first owner will have suffered the bulk of initial depreciation. A well maintained used car can be completely trouble free and may even come with some residual warranty benefit or dealer support. A carefully considered used car purchase may be the avenue to buying the car you want without overextending the budget.#2 How Much Money Can I Spend?How Much Money Can I Spend? Image courtesy of http://www.keenas.com/Being very realistic about the amount of money that you want to spend is very important. There are several strategies that can help with this. For a month before car shopping begins, carefully track all income and expenses to get an idea of just how much car payment the budget will support. Likewise, consider saving the same amount of money each month as your expected car payment, for several months, before buying the new car. This will do two things. First, it will prove that the budget can support the intended or expected payment and second, it will create a cash reserve to be used for purchasing costs. Finally, don't forget to account for incidental costs like changes in insurance premiums, titling and registration fees and taxes that can increase the total upfront costs.#3 Who Will Be Driving (In) This Car?Who Will Be Driving (In) This Car? Image courtesy of datemypet.comThis one is fairly simple. There is a huge difference in a compact commuter and a family hauler. If you are a soloist, perhaps a sports car is appropriate. If you see an opportunity to drop the kids off at school each day, you may need to consider something designed to simplify kiddy transportation (have you ever been caught in the madness that is the drop-off line at the elementary school?).Even more terrifying is the idea that you might need to shop for something that can be used to teach "The Little Princess" to drive. As you car shop, imagine yourself in the passenger seat as TLP negotiates a busy freeway interchange or when Junior, with his freshly printed license, asks to use the car. Shop accordingly.#4 What Kind of Car Do I Need?What Kind of Car Do I Need? Image courtesy of fleetcare.com.au/Although in answering the previous question, you may have decided that what you really need is an armored personnel carrier, bigger is not always better. For a daily commute, fuel economy might be the deciding factor. If the commute includes occasionally running the kids around, a sedan or wagon might offer the best compromise. Do you need to be able to tow a trailer or occasionally haul supplies or equipment? Perhaps a truck or SUV is the right choice.In large part, the intended use of the vehicle will play a large part in answering this question. Certainly however, this is an area where stylistic choices can easily cloud the process. Driving a sports car or a pickup truck can be as much an expression of personal style as it is a response to a particular vehicular need. Be careful if you realize that the desire to look cool or have a hot car is pushing you into a compromise that will be costly in the long run.#5 What Features Do I Need?What Features Do I Need? Image courtesy of cardekho.comOnce you have an idea of what kind of car you are looking for, it's time to look for the features you want. Entertainment, navigation, voice activation, personalized driver profiles, sport mode, sunroof, leather or cloth. The choices are almost endless. Once again, the intended uses and users should be considerations when feature shopping. If you are interested in simplicity, perhaps fewer features are what you are looking for. A base model car might be the best choice.One way to approach this part of car buying is to create a couple of lists. The first one is the "must have" list of features that you have to have. The second is a "nice-but-not-required" list. Use these lists to keep from getting suckered into overspending because the salesman is convinced that you "absolutely must have" the newest gimmick on his lot.
