Reduce Total Cost Of Car Ownership - Helpful Tips
Let's face it, the cost to own a car can be significant and something you may need to manage carefully. When you look at the dealership's price tag, remember, the initial price does not reflect your total cost of car ownership. For example, you must consider extra costs such as taxes, title transfer, and license fees that have to be added resulting in more dollars coming out of your pocket during the next several years.
In addition, there are other costs to consider such as fuel, maintenance, and car insurance premiums. Be sure to calculate your total cost of car ownership to determine if the vehicle's cost is truly affordable before signing on the dotted line. Here are some helpful tips to managing and reducing costs so you can save more of your hard earned money.
Reduce Total Cost Of Car Ownership - Tip #1: Buy for LessWhen you're at the buying stage, take the time to shop around to see if any factory incentive programs are available that could reduce your cost to own a car, and more specifically, the purchase price. And be sure to select a dealership that operates from a Best Price Philosophy so you can be assured you receive the greatest amount of value, without having to waste time and energy with seemingly endless negotiations.You can also reduce interest expense on your car loan over the duration of the loan by making a larger down payment and then smaller monthly payments. Learn more about the process to calculate monthly car payments.
Reduce Total Cost Of Car Ownership - Tip #2: Buy Certified Pre-OwnedDepreciation of a vehicle's value is the most important (and most overlooked) factor affecting the cost to own a car. You need to become familiar with what "depreciation" is before purchasing a brand new vehicle. Over time, the resale value of a vehicle drops -- and this occurs faster when the car is new and slows down as the car gets older. Typically, a new vehicle will lose 40 percent of its value during its first 12-months of ownership.
Whereas, a certified pre-owned vehicle has already depreciated for the most part and can lower your total cost. Look at certified pre-owned vehicles with low miles. They have already experienced most of their financial depreciation and were recently serviced / maintained by factory trained / certified technicians at the dealership.