Car buying guide: Finish strong, and save money

Thu, 22 Feb 2018 | Industry Press Releases

You've done the research and found your next car at a dealership. You're eager to get behind the wheel, but rushing things now could waste thousands of dollars on finance, car insurance and car maintenance costs. Here's our top four tips to finishing the car buying journey like a champion.

Researching, shopping and road testing your next car is exciting, but it can be a long process. So it's understandable that when you've finally found the car you want to buy, you're keen to get the deal done and slide behind the wheel. But rushing the second half of the car buying process could see thousands of dollars in savings slip through your fingers.

Price negotiations are a great chance to save money, but don't underestimate the savings to be had if you do your homework on car finance, car insurance, aftersales care and pre-paid maintenance plans. These four tips will make sure you complete the purchase as thoroughly and expertly as you started it.

1. Haggle hard, and be prepared to walk
New Zealanders buy and sell over 1 million new and used cars every year. That means the four-wheeled beauty you're close to buying is not the only fish in the sea! Make sure the price the dealer has given you is a drive-away, no more to pay, price. It should include on-road costs, dealer delivery fees, stamp duty, and any add-ons like a roadside assistance package, paint protection scheme, or accessories like a tow bar or floor mats that you've asked for.

If you're not totally comfortable with the final price, maybe this is not the right car for your budget. Be prepared to walk away and start your search again. It may take another few weeks, but could save you thousands.

2. Car finance
Six out of every seven car purchases involve finance of some kind. Car dealers know this, that's why every dealership is ready to offer you a finance package from their ‘preferred partner'. It may be convenient and easy to take up this offer, but chances are it won't be the best deal for you.

Before you started shopping for your new car you set a budget, but did you research the best way to fund the purchase? Leasing, or loan? If the latter, then rolling the car purchase into a home loan either by refinancing or using equity will mean a lower interest rate than a personal loan. Be prepared for the finance company to ask questions about car insurance, too, because comprehensive insurance will be a requirement of the finance agreement. Have your quotes ready... more on that below.

3. Car Insurance
You'll be paying for car insurance long after you've stopped paying off the vehicle's purchase. Now's the time to start a relationship with a car insurance company that could save you thousands in the long run.

Research your options thoroughly, and remember to compare apples with apples. Be honest with the car insurance company during the quote process about your driving history, how the car will be used, and where it'll be stored at night, because car insurances companies use that information to offer you the most competitive premium they can.

Some companies may let you raise the excess to lower the insurance premium, but this could leave you out of pocket when it comes time to claim. Youi Car Insurance offers this flexibility, as do many of the others, along with the ability to pay monthly, quarterly or annually. And read the fine print. Some car insurance policies don't come with roadside assist, or cover items inside your car - like laptops and phones.

4. Aftersales and servicing
It's not just new car buyers who can take advantage of prepaid maintenance packages. Second hand cars that are still under the new car warranty may have originally been sold with a prepaid maintenance plan, and that could means free servicing for you!

If your car is no longer under a new car warranty, but is less than 10 year old, the dealer must still provide a statutory warranty (the duration varies state to state). If they have a service department, they can also offer discounted servicing because you bought the car from them. Now is the time to negotiate that discount, not after you've bought the car.

This content is supplied by Youi Insurance NZ