Buying and owning a car is a big financial decision and commitment so why do many of us fall into clever marketing traps rather than consider practical issues when shopping for a vehicle?
When buying a house, you think about value for money, how close it is to work or school, whether or not it’s in a good neighbourhood and its potential resale value – all sensible and logical considerations.
However, when buying a car, many of us consider the look, colour, chromed mags, top speed and torque (even if we’re not entirely sure what it means) over fuel consumption, service costs, availability of spare parts, boot space and trade-in value.
Financial services provider, DirectAxis has put together a seven-point checklist to help prospective car buyers park their egos and get the most car for their money.
- Put needs ahead of wants: The abundance of shiny 4x4s and softroaders on the school run are testimony to a triumph of marketing over practicality. They may have a bit more space for school bags, but even the raised 2×4 crossovers cost more to buy and run than the hatchbacks they’re based on. Is the bit of extra space worth the price tag and do you really need a 4×4 to go camping twice a year? Decide what characteristics are most important based on what you’ll be using the vehicle for – do price, handling, economy and safety outweigh ride height, off-road capability, space and power? Once you’ve decided on which characteristics are most important for you, start narrowing down which cars best meet those criteria.
- Think beyond the purchase price: Find out about running costs and reliability, and check the manufacturer’s claims against independent websites and road tests. If you’re buying a second-hand car or are planning to keep a new car beyond the warranty period, consider the cost of parts and services.
- Question conventional wisdom: Armchair experts will confidently tell you that diesels are more fuel efficient and petrol gives you more power. While there once may have been some truth in this, modern petrol engines are so fuel-efficient that if you do less than 16 000km a year you’ll probably be better off with petrol due to the lower purchase price. While we’re busting myths, the performance difference between petrol and high-performance modern diesels is negligible.
- Sort the finance first: There are many ways to fund a car, from personal loans to specialist car finance. Most manufacturers also offer finance. By doing your homework and finding out what finance you’re eligible for and at what interest rate, you can choose the best offer rather than being pressured into choosing a package on the showroom floor. Online loan calculators will work out your monthly repayments and detail additional charges, such as initiation fees.
- Always negotiate: Some new car models are so popular that they sell for the listed price, but that’s the exception rather than the rule. With so many competing manufacturers and dealerships it’s a buyer’s market, so insist on getting the best deal you can.
- Be wary of extras: Many dealers will try to sell you extras. Again only consider any that you really need and bear in mind that these can often be bought later, somewhere else, at a better price. Some such as ‘paint protection’ are nearly worthless.
- Insure comprehensively: If you finance your car through a bank it belongs to them until you’ve paid off the loan. It’s why they insist on comprehensive insurance. Some people try to get around this expense by cancelling the comprehensive cover a few months after buying a car. Not only does this put you in breach of the finance contract, but also means that if the car is badly damaged, written off or stolen, not only are you without a car but will have to pay whatever is still owing on the finance agreement.
“A car isn’t an investment, it’s an expense,” said Marlies Kappers, head of marketing at DirectAxis.
“When you think about it that way, you may be more inclined to make decisions about which car to buy with your head, not your heart.”
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