Buying your first car should be a fun experience. Whether you just earned your driver’s license or you’ve been relying on public transportation for a while, shopping around for a car is exciting. However, there are some things to think about when it’s time to choose a vehicle and finance your purchase.
Here are five basic principles to consider when buying your first car—before you sign on the dotted line or hand over your hard-earned cash.
1. Your Budget
Even if you’ve saved some money and have a steady job, you still need to know your budget before you can shop around for a car. If you look for an older, lower-priced vehicle, you may be able to save money and pay with cash. This is a good option if you don’t want monthly payments.
If you opt for monthly payments, you’ll need to determine how much money you can set aside in your budget. Financial experts recommend spending between 10 and 15 percent of your total monthly budget on car expenses, as CNN Money explains. Once you know this, you will know what caliber of vehicle you can afford.
2. Type of Vehicle
Sports cars are exciting and fun, but they aren’t practical if you work on a construction site or carpool with others. Think about how you plan to use your vehicle on a daily basis. If you need to haul tools or equipment, look for a truck or SUV. If you have a long commute, go for a car with good gas mileage. Find a vehicle that you’ll be happy driving every day so you don’t regret your purchase.
3. Test Drive
Once you determine the type of vehicle you need, take several makes and models out for test drives before making your decision—even if you end up with the first one you try. Keep an open mind, especially since this is your first car. You may have your sights set on a specific model, but a test drive may change your mind.
4. Dealership Background
Before your purchase anything, do some research on the dealership, as noted by the Federal Trade Commission. Consider the dealer’s inventory, prices, and customer service. A good dealership will be there to help you every step of the way.
5. Options to Save Money
Buying your first car is exciting and rewarding. Shop around and find the best vehicle for you at the most comfortable price.