How To Buy A Used Car And Save Big

by Neal Frankle, CFP ®

car-babySeveral years ago I bought a used car for about $16K less than the going price. You can use the following five used car buying tips to replicate the huge savings that I snagged.

1.  Know How Much You Want To Spend

If you aren’t clear about what your budget is, you might get swept away in the moment and find yourself in debt with a car loan.  Don’t go shopping without having a budget.

2. Know What Car You Want

The same logic applies.  If you aren’t crystal clear on what your ultimate goal is, you might get distracted and end up overbuying.  Don’t fall for it.

3. Buy Before The Old One Breaks.

The worst thing you can do is go shopping for a car when you have no other alternative.  This puts the pressure on and forces you to make quicker decisions than you otherwise would.  The only way to have the scratch to do this is to budget for the car years before you actually make the purchase.  This is something that few people do but is actually extremely important.

4. Shop on eBay

Even though I had no plans of buying the car through eBay, it was a great resource. First, I got a sense for what the inventory was and how fast cars were selling. I also got a good feel for what I should pay for the car. Finally, I made contacts with brokers who were taking back two-year-old cars that had been turned in after their initial lease. These are the people you want to deal with if you want to save money.  You’ll never get a good deal if you purchase your car from a dealership.  I strongly encourage you to take advantage of it.

5. Buy A Certified Quality Car Without The Certified Quality Price Tag

You obviously don’t want to spend all that money and then worry about getting a lemon. Identify your car and then take it to the dealer for a complete diagnostic. Ask them for a certification inspection. This should cost about $200, but it is well worth it.

Using these steps I saved about $16k on the last car I bought. The lower price also helped me buy car insurance for less.  Win-win.

What used car buying tips have you used to save serious dough? Would you use these ideas? Why or why not?

 

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{ 2 comments… read them below or add one }

Judy November 4, 2013 at 2:51 PM

Where do you find these brokers?

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Neal Frankle, CFP ® November 6, 2013 at 7:32 AM

I found mine thru Ebay.

Reply

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