The Dos and Don'ts of Buying a Car

Unless you live in a city where you rely on public transportation, at some point in your life you're going to have to look a car salesman in the eye and pretend like you know your shit. If you're anything like me, you don't know the difference between an oil filter and your gear shift.

It's extremely intimidating when a man in a suit is trying to sell you a $20,000 pile of metal that you're just not quite sure about. It's okay, Google and I will help you. Here's a few pointers to get yourself painlessly through the car buying process.

Do: Set a Price Range

Once all your finances are stable and the dust has settled from starting your first big boy job, you should know how much wiggle room you have for a car payment every month. A good rule of thumb is to put 20% down on the car right away, then no more than 10% of your monthly paycheck should go towards payments.

Do: Your Research

Search online, ask your friends, and read reviews. Kelley Blue Book is a great online tool for honest pricing. You should know the basics of what you do and don't want before you step foot on a car lot, especially when it comes to pricing. Don't be afraid to correct the salesman when he quotes you the wrong price on the fully loaded model. If you've done your research, you'll be confident in your purchase.

Don't: Be Married to a Color

Narrow it down to two or three, but don't be dead set. If you tell the salesman you definitely want red, he knows you'll be willing to pay more for the color you want. Being flexible on the color gives you some leeway when it comes to pricing. On the other hand, if you know the dealership only has a red model and you tell them you 100% want the black model, they will likely lower the price to compensate for you not getting your first preference.

Do: Have a Maximum Price in Mind

After you've done all your research, you should have a solid idea of the maximum price you should pay for the make and model you want. Keep this number in mind as you negotiate the price of your new car. Don't be afraid to argue and compromise with the account, no one pays sticker for a car. With that being said...

Don't: Be Afraid to Walk Away

You don't have to buy the car, no one is making you. If the accountant isn't willing to go as low as you'd like, leave. You're not offending anyone and you're not obligated to buy anything if you don't want to.

Do: Research the Dealership

This goes for any car lot or dealership. Some make commission and some simply have a quota. I prefer to buy cars from companies who give their employees a quota to sell. They tend to care less about the price you are paying and are willing to work with you more. They're goal is to sell you a car, not get the highest price out of you.

Don't: Be Afraid to Ask questions and Test Drive

The salesman is ultimately there to help you. It's his or her job to be the expert and answer any question you might have about the vehicle. Don't be afraid to utilize their expertise. You did your research online but they will likely be able to better explain any explanation you found.

Do: Be in Love with your Purchase

In The Blind Side, Sandra Bullock states "If you don't absolutely love it in the store, you won't wear it". I believe this is true in most situations. If you aren't absolutely in love with the car in the lot, you won't be in love with it when you get home.

Finally...

Don't: Rush into Anything

Buying a car is a large purchase and will most likely be your first large loan to help build your credit score. You shouldn't rush into anything and possibly regret your decision later on.

Follow my steps to make this process as painless as possible. Buying your first car should be an exciting experience and should leave you with a car to love for several years down the road. Think of this as both an investment and also a tool to further build your credit. Good Luck!!