Buy A Car But Don't Break The Bank: Dave Ramsey Shares 7 Things That Most People Get Wrong

Ready to hit the car lots and get yourself a new set of wheels? Pump the brakes! Diving into the car buying process without a plan is like stepping into a dealership with a “please take my money” sign. It’s easy to get swept up in that new car smell or the latest tech features, but there's a smarter way to cruise through this major financial decision.

Here is some road-tested advice from financial guru Dave Ramsey on what to do and more importantly, not to do while buying a car.

Setting A Car Budget Wisely

Dave Ramsey believes you should only consider buying a new car if you have plenty of money to burn. Image: Shutterstock/ Brian A Jackson
Dave Ramsey believes you should only consider buying a new car if you have plenty of money to burn. Image: Shutterstock/ Brian A Jackson

Think twice before buying a new car — they plummet in value like a rock dropping off a cliff, losing 60% in the first five years! Unless you’re sitting on a million bucks, stick to a used car. Before you shop, figure out what you can pay in cash. Yes, cash! If you can't buy it outright, you can't afford it. If you’re not there yet, start saving.

Picking The Right Car

Narrow down your options to a few cars that fit your price range and needs. Image: Shutterstock/ Inside Creative House
Narrow down your options to a few cars that fit your price range and needs. Image: Shutterstock/ Inside Creative House

Once you’ve got your budget, sift through your options. Start online at local dealerships or sites like Craigslist. Focus on what fits your budget and needs — safety, fuel efficiency, and how it handles different weather conditions. Just because it's affordable doesn't mean it's the right choice for your lifestyle.

Do Thorough Research

Narrowed down on a few options? Now do some more research and ask the right questions. Image: Pixabay/ 
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Narrowed down on a few options? Now do some more research and ask the right questions. Image: Pixabay/ TungArt7

Found a few cars you like? Dive deeper. Check the Kelley Blue Book value to ensure you’re getting a fair deal. Obtain the car’s history report using the Vehicle Identification Number (VIN) to learn about past accidents or issues from sites like Carfax or VehicleHistory.com. Even free reports can flag major concerns.

Don't Skip the Insurance Quote

One thing people forget very often is to consider the cost of car insurance. Image: Shutterstock/ Kmpzzz
One thing people forget very often is to consider the cost of car insurance. Image: Shutterstock/ Kmpzzz

Before you finalize, understand the insurance costs. The type of car impacts your monthly premiums. Chat with your insurance agent to get quotes or shop around for the best rates.

Take It for a Spin

It is worth noting that the way a car handles on the highway will be different than how it drives in the city. Image: Pexels/ Shkrabaanthony
It is worth noting that the way a car handles on the highway will be different than how it drives in the city. Image: Pexels/ Shkrabaanthony

Test driving is crucial. Don't let flashy salespeople upsell you. Stick to what you need and watch out for signs of trouble like odd noises or a rough ride. Make notes on anything amiss to discuss during negotiations.

Get It Inspected

Before you commit to a used car, you need to take it to a mechanic for a full inspection. Image: Pexels/ Andrea Piacquadio
Before you commit to a used car, you need to take it to a mechanic for a full inspection. Image: Pexels/ Andrea Piacquadio

Always have the car inspected by a reliable mechanic before you buy. This step uncovers hidden problems and ensures you’re not buying a money pit. If the seller hesitates at this, consider it a red flag.

Time Your Purchase

Waiting for the right time to buy a car can still save you a lot of money. Image: Pexels/ Negative Space
Waiting for the right time to buy a car can still save you a lot of money. Image: Pexels/ Negative Space

Timing can be everything. Shop during holiday sales, at the end of months, quarters, or during the year when dealers are desperate to meet quotas. Late summer and year-end are prime times for deals as dealers clear out old stock.

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