How to Buy a New Car

Parked Cars

Is it time you started searching for a new car you can rely on to get you to and from work in Michigan? This should be an exciting time, but it may not feel that way to you. With so many options available, it can be stressful to find a model that is well-suited to both your personal needs and your budget. To help you out, Xpress Cash provides a guide on when and how to buy a new car, as well as how to budget for the purchase, below.

When to Buy a New Car

Being that it’s such a significant financial decision, knowing when to buy a new car is just as important as knowing how to buy a new car. Here are a few signs that it’s a good time to take the leap:

  1. You’re frequently paying for costly auto repairs. If it gets to the point where you’re paying more for repairs in a year than you would for a new car, you’ll know it’s time for an upgrade.
  2. You’ve felt unsafe when driving your car. If you’re constantly worried about getting into a collision and you question your car’s safety, it’s definitely a good time to look into a replacement.
  3. Your overall needs are greater now than they were in the past. Maybe when you bought your current vehicle you needed nothing more than a compact sedan, but now you have children to think about or you simply need to carry more gear on a daily basis. Whatever the situation, it might be time to consider upgrading to a more spacious model with modern safety features.
  4. Is your car failing emissions tests? Getting it to the point where it meets requirements can be costly, so opting for a newer model may save you money in the long-run.

How to Find the Right Car for You

If you’ve decided that yes, now is a good time to buy a new car, where do you begin? The best place to start is to set a budget and stick with it. Some financial experts recommend spending no more than 10 to 50 percent of your gross annual income on a new ride, but that’s a pretty wide range for most shoppers. A good middle ground is to say you’ll spend no more than 35 percent of your pre-tax annual income. 

Now comes the hard part – finding the right model. Check out these tips for help:

  1. Narrow your search. Take into consideration your driving habits (including your daily commute if applicable), cargo space requirements, desired tech and safety features, etc., then start searching for models that meet your needs within your budget.
  2. Choose three models as your top choices, then research their safety ratings, reliability, average lifespan, etc. If time allows, you should also test drive each model to see how you feel behind the wheel.
  3. Once you’ve made a final choice, do a search to find all of your local dealership options. Request price quotes from each dealership, and be sure to do some research on what other shoppers have paid. And remember, you can and should negotiate the price
  4. Consider the time of year, as you might be able to hold out for a great deal on Black Friday or Presidents Day.

Navigating the Finances of a New Car

In addition to sticking to a budget of 35 percent or less of your pre-tax annual income, there are other ways you can make that new car feel like less of a financial burden:

  • Save up to pay cash if possible. Car dealerships won’t love you for paying cash rather than leasing or financing your purchase, but your bank account certainly will! 
  • Consider buying used. You may have your heart set on a new car, but if you’re worried about the financial impact, it’s smart not to entirely rule out the idea of a used model. You can check out late model year used vehicles that will offer the modern features you’re looking for at a great price. 
  • Limit your unnecessary purchases. When a new car purchase is in your future, your spending habits should reflect it. Think about eliminating fast food purchases, pausing music or TV streaming accounts, and cutting down on other non-necessities.
  • Set up a dedicated savings account. Why get a new account? It gives you a specific place to put your car savings so you’re not tempted to dip into it for other purchases. Once you’ve started an account, you can set up an auto-transfer from your checking account for a specific amount each month to help you save with little effort.
  • Pick up a side job. While signing up to drive for a rideshare app might not be in the cards right now, you could look into other options like pet sitting/dog walking. You could also consider selling items you no longer need or use on Ebay and other selling platforms.

Contact Xpress Cash for Additional Help

If you’re seeking additional help with purchasing a new car or would like to learn more about the short-term loan options available at Xpress Cash, we invite you to contact our team or stop by one of our Michigan locations to speak with us today!