Simple directions for buying a car.
It may not have that new car smell, but no car payment and $50/month for gasoline sure smells good!
—”Freebie”, Mint Blog Comment
You should only do time-consuming price research for big ticket items— and this is one. Here’s our roadmap to your next car.
New, used or lease?
A car’s value drops by 15–20% the moment you leave the lot. Buying used, with the blessing of a good mechanic or a Carfax report, is often a better financial decision. Leasing only makes sense when you have significant disposable income.
Know the total costs.
Don’t go to a dealer before you check Edmunds or Kelley Blue Book for a price. If you’re buying, you’ll put 10–20% down, and pay interest on the balance. Add your insurance, gas, and maintenance estimates to get your total. The good news is, you’re already covering some of these costs today. Mint’s financial calculator makes it easy to see your auto-related spending by automatically categorizing those expenses across all of your accounts. Subtract this amount from your total cost and that’s how much you’ll need for your new car.
Know what you can afford.
Mint shows all your assets in one place. Got enough for the down payment and fees? Great. Our cash flow widget can tell you if you can cover the added costs. If not, use our budget planner widget so you can start saving.
Get the lowest price.
Information is power — so get some, and negotiate. Identify likely maintenance and repair issues using Consumer Reports so you can ask pointed questions. Know your credit score and get a pre-approved loan so you can compare financing costs.
