If you’re looking to buy or lease a new car, you’re probably wondering about the best time to do it. Some people believe that heading to the dealership at the end of the month will get you a better deal. Others wait until they have their tax refund in hand before they go shopping.
But these strategies aren’t right for everyone. The best time to buy or lease a car is when YOU feel prepared. Walking into a dealership with confidence is the best way to make a smart decision. Use the following tips to help you get there.
Look at your budget
Buying or leasing a new car is a serious financial commitment and will likely be one of your biggest monthly expenses. Some experts recommend budgeting 15 percent of your gross annual income for total vehicle expenses. This should include your monthly payment, gas, auto insurance and regular maintenance.
BUDGETING TIP: If the numbers don’t quite work, look for ways to rearrange your budget. Maybe you can take a few dollars from non-fixed expense categories (such as entertainment or clothing) and move them to your vehicle category.
Visit the dealership
As you browse the dealership’s selection, remember that the Manufacturer’s Suggested Retail Price (MSRP), or sticker price, is just part of what you’ll need to consider. You may also be required to pay for sales tax, title and registration, plus any add-ons you opt for, like GAP insurance or extended warranty. Together, these costs make up your monthly payment.
BUDGETING TIP: Trading in your current vehicle or making a down payment can reduce the overall amount you need to finance, which may lead to monthly payments that better fit your budget.
Get behind the wheel
The total cost of having a car goes beyond your monthly payment and gas expenses, so be sure to plan ahead. Putting a little money aside now will help you afford unexpected expenses or splurges (think new tires or a road trip) without taking on debt or dipping into your savings.
BUDGETING TIP: In addition to your regular savings, try to put $20-$50 aside each month into an emergency fund or a designated savings account.
Is now the best time for you to buy or lease a car? Apply online to see if you’re eligible for prequalified financing.