Other than buying a home, buying a car is the most expensive financial transaction most of us will ever undertake. Additionally there are few experiences that are simultaneously more exciting and stressful. When it is time to replace your car, there are important questions you need to ask yourself, to ensure you are making the right, informed, decision.
For some it will be a simple decision based on practicality, cost and performance. For others it will be a combination of dozens of individual, personal and even geographical factors – living in Shropshire and Mid Wales throws up a different question set compared to city dwellers. So what are the five main questions you need clear answers to before taking that all importance decision to buy a new car?
1. Do you really need a new car?
Not as silly as you might think. Ask yourself honestly, what exactly is wrong with your old car? Have you squeezed all the practical use and value out of it? Will a new car deliver such massive cost savings, practical advantages and lifestyle benefits that it is worth the considerable capital investment required?
Then there is an even more basic question – do I even need a car at all? Have your circumstances changed? Have the kids moved out, is your work nearer than before? Have you moved to a bigger town with plentiful public transport - where walking, cycling or the occasional taxi ride will meet your general transport needs?
Is the new car is a second car replacement, could you downsize to become a one-car family and save money that way?
If if it still comes out that a new car is your best option, or if you live outside the main towns of Shropshire and Mid Wales and are faced with one bus every other Tuesday, then it is time to move to question 2.
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2. What can you afford?
Ok, so you have decided a new car is ether a must have, or it’s time for a change, either way you need to set a realistic budget. Capital outlay, trade in value and finance agreements all play their part. Once you have calculated all the factors then you need to make a decision – should you buy a cheaper car with a higher spec, or a more expensive one with a low spec?
If you decide a loan is the way you must go, first take a look at your budget to see what type of monthly payment you can afford, and compare interest rates carefully. They can be vastly different to what is on offer from car dealers, so check around the web for the best price before committing to a new loan.
Have you considered other operating costs? Many people fall in love with a type or specific model. Don’t let that blind you to the maintenance costs – a big SUV, sports car or city run-round will all vary tremendously when it comes to maintenance and running costs.
Don’t forget to check insurance quotes either - your age, the safety rating, make and model of the new car will all affect affordability. A car’s popularity, power and appeal to thieves, cost of parts and repairs are all issues that will all have an impact. Insurance is of course one of your major ongoing costs.
3. Which make and model ?
Are you most concerned with luxury, utility, or reliability? Personal circumstances will dictate your search – trying to fit a family of five and granny into a Hyundai i10 (for example), could prove problematic. Look at your typical driving pattern, where you go, who and how many people typically travel with you, business or leisure use – they will all shape your thinking on which style of car best suits your needs.
Do you worry about environmental issues? If you’re looking to significantly reduce your carbon footprint, you may want to choose an electric car like a Nissan Leaf, or a hybrid like a Mitsubishi Outlander PHEV, or at least something that delivers great fuel economy.
Will you be using the car for personal or business purposes? How you use your car can significantly impact tax and financing options.
How long do you intend to keep the car? Some cars have a better resale value than others, so if you plan to trade it in within a few years, you may want to choose a model that holds its value well.
Once you’ve decided on the type of car you want, do some research – lots of research. Check out online reviews and test drive videos, car magazines and consumer reports.
4. Do you need, and can you afford extra features?
If you’re buying a new car, it will have a choice of specs. Be clear on what you really want (or need) before agreeing to a higher specification. Whilst four-wheel drive makes sense, if you live in hilly country or experience icy or flood conditions, are those flashy alloys and built-in Apple infotainment systems really necessary?
So choose what you need and ignore all the bright lights, bells and whistles if you don’t strictly need them.
For good all round versatility, and value, the new 2015 third-generation Honda Jazz would be a good choice. It features unrivalled interior space, with 1,314 litres of boot space with the rear seats down. Advanced safety and technology includes Intelligent Speed Assist, Forward Collision Warning, Lane Departure Warning, Traffic Sign Recognition system, and High-beam Support System. That’s a lot of car for your money.
5. What dealer should you trust?
Buying a new car means finding the right dealer. Choosing the right one is the difference between enjoying carefree motoring or a waking nightmare. If your last dealer gave you good advice, a competitive price and excellent after sales service, then that should be your first port of call. However, if that was not the case, or you want a specific make and model, then a franchise dealership will be your best bet. Check your local online forums, people in the know, any friends and colleagues who own the same car. Ask for recommendations and any bad experiences.
Social networks and owners’ forums will give you a good idea of the good guys and the sharks. Pay special attention to dealers who handle complaints well, and answer enquiries promptly and accurately.
It is important to protect yourself. New cars generally come with a manufacturer’s warranty, which will protect you from manufacturer’s defects until you have had the car for a certain number of years, or reach a certain number of miles.
Some manufactures are so confident in the reliability of their cars that they offer an extended warranty. Some dealers also offer extended warranty for an added cost.
Get the full picture before you commit to a specific dealer.