I like cars. Well, I like the idea of cars. I know that the newness goes away very quickly so I’m good about admiring and talking about cars but not actually buying them. My previous car (a Mazda CX-9) was eight years old with about 170,000 miles on it. Before that car, I traded in a Honda Odyssey that was eight years old and had more than 200,000 miles on it. Yes, I drive a lot – mainly for travel because we love to travel but like to take all our “stuff” with us (and it’s often cheaper than flying).

Anyway, what I don’t like about cars is the car-buying process. Historically used-car salesmen have had a pretty poor reputation but from my experience, it doesn’t matter if the car is new or pre-owned (though I recommend you at least consider buying pre-owned) – the sales people and the sale process can be painful.

save money with these 7 car buying tips

Besides having bought a few cars in my life, I also worked at a car dealership (many many years ago) so I have some insight into the sales process and how things work behind the scenes at dealerships.

While there isn’t much I can say that will make the process enjoyable – there are definitely some things that can be done to prepare you for the process, allow you to get the best deal, and to help you avoid unnecessary expenses that often creep into the negotiations.

So let’s jump right into the tips…

Set a budget – and stick to it

Before you go shopping for a car, understand how much you can afford to spend, and also how much you are comfortable spending. These two numbers might not be the same, so if not, go with the lower of the two numbers to help avoid buyer’s remorse.

I’m always going to recommend buying a pre-owned car because the depreciation that happens in the first two years is crazy. Per Edmunds, the average car loses 9% the minute you drive it off the lot, has lost 19% by the end of the first year and has lost 31% of it’s value by the end of the second year. So buying a two-year old car can save you more than 30% on average!

I’m also going to recommend you pay cash. Paying interest on any type of debt can be a big hurdle to growing your wealth, but especially on a quickly depreciating asset like an automobile. Also, if you pay cash you have some negotiating leverage. If you finance the car there are a ton of little tricks that the salespeople can do to get your payment within a certain range – but this generally doesn’t involve lowering the price of the car, and in fact, they could increase the cost while getting fancy with the financing. Giving them so much control in this manor is very dangerous and will work against you. Avoid those troubles and just pay cash.

So if you are paying cash you can focus on the total cost of the car rather than monthly payments. How often do you see car commercials that show the actual price of the car? Or if they do, it is in some tiny little font at the bottom of the screen that is very hard to read and only shows for a couple of seconds. Dealers want you to focus on payments so you’ll need to be strong and even do a little research to understand the total cost and stick to it.

Do your research

A very powerful tip when car buying is to arm yourself with knowledge. Hopefully, you set a budget as mentioned above. Once you’ve done that you can start researching cars that fall into the range you are willing to spend on the vehicle. You can check dealer sites, craigslist, local advertisements, or online sites like autotrader.com.

Once you have identified some specific makes, models, and years that you are interested in, and are available, start to research those specific cars. You can get a lot of information from sites like Kelly Blue Book or Edmunds that is rather specific to the vehicles you are considering. There are options to select the year, the mileage, upgrades, condition, etc. and the sites will not only tell you what to reasonably expect for a price, they usually will also give reviews – helping you minimize surprises down the road.

Time your shopping

Time your shopping – if you can. Car dealerships often run specials at different times of the year (like big holidays). They also provide internal incentives and competitions for their sales people – who only get paid when they make sales. Because of these incentives, salespeople are often more motivated to make a sale near the end of a month to help them finish strong and possibly achieve some internal goal. I’ve also been told that shopping for a car on days that fewer people are likely to be shopping – perhaps cold and/or rainy days – can work to your favor because sales people can get frustrated by the lack of visiting traffic and really want to make a deal.

Expect negotiation

Unless you go to somewhere like carmax with “no haggle pricing”, expect to negotiate. Because of this, always start low – perhaps lower than you reasonably think the salesperson might accept. You can always work your way up on the pricing, but once you’ve said a specific number, it will be very hard to get a salesperson to accept lower.

Remember your budget and use it as a hard-stop limit on what you are willing to spend. If your budget is $6,000 and you found a car that review sites say should be right around there but is listed for more than that – you can always tell the salesperson that. Say “look, I’ve got a hard limit of spending $X so I need to get a deal for that much all in – taxes, fees, and everything else”. Again though, just be sure you are good with whatever price you mention because it is very unlikely the deal will be lower at that point. If the review sites say that is a reasonable price for that specific car though, and you are good with it, this can be a good negotiating tactic.

Ask for certification or free warranty

Once you’ve reached a point that you think is fair for the car, and is within your budget, and you’re willing to spend – but before you’ve told the salesperson you are ready to pull the trigger – you can still negotiate a bit to try to get some extras. One thing that they can sometimes do is offer “certification” or a free warranty on the car. It won’t be anything like the warranty on a new vehicle, but sometimes they can throw in a year or two worth of warranty. If they won’t, I’d push for at least a 30-day warranty so they can fix anything that might not come up in a test drive but does come up shortly after the purchase.

Avoid costly add-ons

After you reach a deal with the salesperson you are likely going to have to sit through a very annoying process with a “finance person” – even though you are paying cash. This person is going to try to scare you into purchasing some additional stuff for your car. Things like undercoating and extended warranties that aren’t worth the money. I’ve tried to be blunt with these people in the past and avoid the sales pitch, but it hasn’t worked yet. I even had one of them tell me she was “required by law” to tell me about all of the options they offer. I’m pretty sure she was lying about that.

Stay strong at this point because you’re almost done. Don’t let that price creep up beyond what you already agreed. If you told the salesperson you would pay no more than a certain amount for everything, and they add on “delivery charges” or other fees that push you beyond that, don’t hesitate to get the salesperson involved again to make it right. And if they balk at that point, be prepared to walk away.

Be prepared to walk away

Be prepared to walk about – and be serious about it. There are a lot of cars for sale so you really shouldn’t feel pressured to buy a specific car. That said, the process can be exhausting, on purpose I think, and can wear you down. It’s easy to reach a point where you just want to be done with it all and get out of there, but you’ve already invested so much time and emotion into the process that you don’t want to go through it again with another dealer. But you really do need to have a walk-away as a reasonable option. This needs to be exercised especially if they agree to something then try to surprise you and make you pay more.

Yes, you might wind up not buying that car, and that’s okay. But here’s a secret – you might still get the car if you walk away. Deals are still done out in the parking lot as people are about to leave. Once a salesperson knows that a deal is about to fall through; that they were “this close” to getting paid, they become very motivated. You need to be okay with not getting the car too. This doesn’t work very well if you aren’t serious. There are a lot of cars for sale in any given area at any given time, so you have options. Remember that you are the one with the money so you are in control.

Using these tips will help you maximize your money when making a car or truck purchase. Read over these and follow the pointers before you step foot onto a car dealership lot. It can save you a lot of time, money, and emotional drain. The car-buying process can be a hassle but don’t let it be any harder than it needs to be. Good luck!