Purchasing a new vehicle can be a huge undertaking. It can have long term effects on your finances. There are several things that should be considered prior to making a final decision.
Let's explore some things you should take into account while car shopping.
When to Buy Your Next New Car
Quite often, new vehicle buyers can realize extra savings if they negotiate a purchase closer to the end of the month. Dealerships need to make certain quotas in monthly, quarterly, and yearly sales. If they are falling short of their goals, you can often take advantage of that and get a really good price on the vehicle you want as they will be a bit more receptive to negotiating with you in order to close the sale and hit their numbers.
You may find you need to compromise a bit on options, etc. to get the best price as they may not have your exact preferences in a car in their inventory.
Considering Your Budget
Once you have decided on the type of vehicle you will be purchasing, you will then need to figure out how much you are willing to spend. Sometimes, the type of vehicle will set its own budget. For example, if you are looking to purchase an RV or a high-end sports car, it stands to reason you will be spending a bit more money than you would be if you were buying a daily driver.
Or maybe you are looking to purchase a boat or motorcycle. These items are most likely "treats" for yourself and your family and you are apt to spend quite a bit more to make sure you get what you want.
A final budget needs to be determined by you. You should be comfortable with the amount you are spending and it should not put a burden on your finances.
There are options to make the expenditure a little bit easier to manage. A lease can be a better option for some buyers as the monthly payments are often much lower than a monthly payment on a purchase. One must be certain that the lease restrictions (mileage limits, etc.) are within reason and will not result in additional charges.
Maintenance and Insurance Costs
Certain vehicles cost more to maintain than others. Consider the Bugatti Veyron sports car. It costs $20,000 for an oil change. While this may be an extreme example, the point is that you should research the costs to maintain the vehicle you are considering purchasing. You may be able to afford the monthly payments, but the maintenance costs may place the vehicle out of your budget.
Another thing to consider is how much it will cost to insure the vehicle. Sports cars traditionally cost more to insure than sedans. Get a quote from your auto insurance carrier to find out how much it would be to add the vehicle to your policy prior to purchasing.
After you have decided on a car that fits your needs and budget, don't forget to factor in the taxes. For residents of some states or those making a modest purchase, it may not be a big deal. However, if you are buying a big-ticket motorhome or luxury car, those taxes can quickly place you well above the amount you intended to spend.
Consider someone in Washington state purchasing a $100,000 luxury car. The sales tax there is 9.19%! That means the buyer will be paying over $9,000.00 in taxes.
There is another option. By setting up an LLC in Montana can save your big money on high ticket vehicle purchases. Montana has NO sales tax. That's right. You could literally save thousands of dollars by handling your purchase through your Montana LLC.
Best of all - it's simple and easy to set up and not to mention, very affordable.