A top priority for Americans in 2023 is buying a car. GOBankingRates surveyed 1,028 Americans to find out what major milestone they want to achieve in the next year, and 40% said they plan to buy cars.
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Due to the tight economy of 2022, 18% of respondents said they have put off car purchases this year.
Whether you plan to buy a new or used car next year, you’ll want to make sure you start the process with the best possible strategy. Use these tips to ensure you get the best deal on the vehicle of your choice.
Know the best time to buy a car
Timing is everything when it comes to buying a car. A car purchase can often be timed for a specific season, holiday, or month to receive the best deals.
If you’re shopping for a new car, Edmunds recommends writing down these key dates in 2023:
October November and December
Yes, the months with the most discounts to buy a new car are the last three months of the calendar year.
While prices improve as summer approaches, thanks to the introduction of new cars, Edmunds’ data shows that the best time to buy is in December. This month is at the highest discount from the Manufacturer’s Suggested Retail Price (MSRP) and dealers are working hard to close out the year with great sales as they work to get rid of old inventory.
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three day weekends
We often see three-day weekends heralded as some of the best times of the year to get a great deal on a new car. Edmunds ranked each three-day weekend in 2023 to see which weekends have the best deals for shoppers:
Memorial Day. This is ideal for buyers looking for certain car colors or option packages.Fourth of July. Use this time to determine if you want to buy a car from the outgoing year or the coming year.Working day. A “sweet vacation spot,” Edmunds reports, to see a wide selection of vehicles and competitive prices. (It should be noted that the savings will continue to be much higher in the last three months of the year.)
What if you are buying a used car? The best timeline to buy a used car is also October, November and December. According to Edmunds, as new cars enter their peak buying season, more trade-ins are coming into used car inventory. Car buyers have a wider variety of used cars to choose from and at better prices than if they had bought in the spring months.
Learn all you can about prices
According to Kelley’s Blue Book, There are three types of vehicle prices:
Invoice price. This is the dealer’s cost for the vehicle. This does not include the dealer’s costs for advertising or financing the vehicle. It is possible to use the invoice price as part of your negotiation, since dealers make more money from used cars, parts and services. MSRP. The manufacturer’s suggested retail price is a suggested sticker price for the car. It must be displayed on every new vehicle in the United States, by law. However, it is not always the highest market price. Exceptions to the rule may include certain types of vehicles in high demand.Fair purchase price range. This is a vehicle pricing tool developed by Kelley Blue Book. It is updated every week using purchase data collected in the United States.
The more you know about what people paid for their cars, the better you can determine how much you’re comfortable spending and where there may be room for negotiation.
Learning all you can about pricing ultimately ensures you stay out of debt and within your budget. The general recommendation, according to Kelley Blue Book, is that your car should cost no more than 10% of your annual take-home pay.
See the price of the used car before the negotiation
If a new car is out of your budget, a used car may be in your price range. Just like with a new car, you’ll need to set a budget for how much you can afford. Then you’ll need to figure out how you plan to finance the purchase, what can be done with a loan or cashier’s check, and how you’ll pay for recurring car costs like gas, car insurance, registration, and parts.
What about negotiating the price of a used car? Kelley Blue Book recommends you check the price of the used car, plus fees and taxes. Then, share with the dealer more about your plans to finance the car; the dealership will be more likely to accommodate your demands.
Ask about the ‘Out of Door Price’
What is an out of the gate price? Edmunds said buyers who prefer to pay cash and not have to discuss monthly payments and interest rates with dealers and financiers can request retail prices. These are total cash prices, including additional dealer fees.
Don’t buy in a hurry
It’s not a good idea to go into a car dealership unprepared or with the intention of making a rushed or spot purchase. You may end up spending too much on a car that doesn’t fit your lifestyle or lacks the features you want.
Consider buying a car online
While you want to go to the dealership to examine the car and take it for a test drive, you’re not limited to buying the car in person. You can decide to make the purchase through the website of the dealer or the manufacturer.
How is making an online purchase the same as receiving an offer? According to Kelley Blue Book, some manufacturers offer promotional offers or loyalty programs to customers who sign up directly through their websites. Some may include 0% down payment, customer cash, and low finance rates.
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This article originally appeared on GOBankingRates.com: 6 Tips to Get the Best Car Deal in 2023
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