to Buy a New Car

When is the right time to buy a new car? A new car is a major expense and many car owners agonize over this question. Applying a few common sense rules can alleviate some of the agony and add adventure to a new car quest.

• First, consider your maintenance expenses. If your cash outlay for repairs on your present vehicle is averaging more per month than a new car payment, it's time to consider a new car purchase. Add to this the reliability factor. Confidence in your vehicle is a true value. What is the value of confidence? What is it worth to you? If you depend on your car for your livelihood, then dependability is not a convenience, it's a necessity. Keep this in mind when you are comparing the cost of buying a new car versus the cost of continuing to maintain your old car.


• Next, consider the age of your present car. The longer you keep it on the road the more resale or trade-in value it loses. Resale or trade-in value can easily be determined by visiting the Kelley Blue Book website at KBB.com. If you plan to use your present car to help defray the cost of buying a new car, then consider selling or trading in your old car sooner rather than later.


• Then do a little research. What are the market trends? Websites like CarsDirect.com are an invaluable tool for this type of research. The state of the auto industry may be a decisive factor in your new car buying decision. In many cases, you may actually be able to lower your present car loan payments with the purchase of a new car. Pay particular attention to the incentives that the auto manufacturers are offering. Incentives may be finance related or purchase price related. Either way, your monthly payment will be influenced heavily by these incentives. Saving money by buying new is a concept that most people do not consider. In addition to these savings, remember that with a new car, your maintenance and repair expenditures will be reduced significantly. Catastrophic failures will be covered by your new car warranty as well. That's piece of mind that you can't place a true value on but it must be considered.


• Investigate whether or not the Federal Government is offering any incentives for purchasing a new car. Your old clunker may be worth more than you realize. Some government programs are offering large incentives for you to replace your older car with a new, more efficient, more environmentally friendly model. In most cases you will find that the cash value of the incentives are more valuable than the resale or trade-in value of the car itself. This also helps with the decision of whether to try to sell your old car yourself or trade it in. These programs require the owner to trade the car in when making a new purchase.

Clearly, these common sense steps focus on economy. Think of them as "economic sense". It just may be that purchasing a new car makes "economic sense" for many owners. When that shiny new car makes economic sense, then the decision to purchase new becomes much easier...and the adventure begins.