Shopping for a car is often the first major purchase a new graduate makes if they don’t already own one. The process of knowing what you want, getting information, making a decision and negotiating a deal can be a daunting task. Combined with all the other big life decisions that are coming your way at this time new graduates can feel excited and overwhelmed at the same time. Consider carefully whether or not you actually need to purchase a car at this time. For example, if you are going to be living in a city that has good public transportation that will get you where you need to go, buying a car may not be something you need or want to do immediately. But if this is the time to go car shopping, included here are some ideas, facts and resources to assist you in making more informed consumer choices and, maybe, even have some fun at the same time!
Decision Making
What are you looking for?
Probably the most important thing to figure out for yourself before you go looking at cars at all is to know clearly what you are looking for. The importance of this cannot be overstated. Car buying can be both a rational and emotional venture. Since there are so many options to choose from, you must know what you want so that you will not be sold something that you don’t need or can’t really afford. So, before you even begin, write down some of the things that you think are important to have (e.g. – 2-door coupe, standard, great stereo system, air conditioning, excellent gas mileage, etc.). This way you will know ahead of time what you should be focusing your attention on and can be more discriminating when talking with salespeople.
Do you want a new or used car?
Nearly three out of four cars purchased are used cars (Consumer Reports, 1998). This is because a new car quickly depreciates in value. Compared to buying a well cared for, quality used car, new cars are not viewed as good an investment. New cars also are much more expensive than used cars. The purchase price of a used car is cheaper, less costly to insure and, if you are fortunate enough to be able to pay cash for your car, you will avoid finance charges as well. Still, the decision to buy a new car versus a used car involves more than just cost. Other important considerations are reliability, maintenance, mileage, and the warranty that comes with the car when you buy it. Sometimes dealers provide a warranty of their own on a used car but it is usually not as complete as the manufacturers warranty on a new car. Private owners provide no warranties at all when selling a used car.Research
Where do you look to gather information?
As a consumer it is critical that you gain accurate, up-to-date, useful information from reliable sources before you make any major purchases. Being a savvy consumer will save you a lot of time, money, aggravation and inconvenience. Now that you have made some decisions about what type of car and which models to concentrate on you can begin to collect data about them. Literature that you collect from a manufacturer or dealer can be helpful, just keep in mind that these are still advertisements geared to get you to buy. Automakers use technology to enhance the appeal of their products and market themselves through videotapes, CD’s and interactive web sites. Dealers can be located on the Internet through dealer-locator services, dealer networks and dealer web sites. Again, remember while these sites can provide some helpful information they are designed to sell their wares and may contain incomplete or missing information.
There are also many independent sources of consumer information that provide less bias in making purchasing decisions. Consumer Reports is a magazine that is published monthly by Consumers Union. Since 1936 they have been a non-profit organization whose purpose has been to test products, provide information and protect consumers. They also publish the Consumer Reports Buying Guide each year. This serves as a reference guide containing the most recent testing reports and advice on major consumer products. These publications offer a wealth of practical information and can be found in most libraries. Bookstores often carry price guides for new and used cars (be careful though because frequent price changes can quickly outdate these materials). Auto clubs, such as AAA, and the Internet can provide further information and details. Finally, it may be a good idea to talk to insurance agents about the cost of insuring different cars. You would be surprised at the differences in rates depending on the insurance classification of each car.
Resources
(For nominal fees you can get the latest consumer information, advice and prices for the vehicles you are considering purchasing. You can also get a personalized report that helps you make comparisons and provides money saving tips. To access this information go to the Consumer Reports web site and in the menu on the left – Click on Cars and Trucks then Price Services.)
(This search engine provides auto facts sheets, financial guides for smart money tips and insurance and all major auto manufacturers home pages.)
(Kelley Blue Book provides great information to guide the car buyer including looking at new and used cars, financing, insurance, price comparisons, and reviews.)
(Contains a large database of used cars as well as information about new cars, decision making, comparisons, warranties, insurance and financing.)