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You can save a bundle on your next car purchase by buying a used car. One of the common concerns I hear from people about used cars is that they will require expensive repairs sooner than new cars. There is no question that repair bills can be outrageously expensive but here's one way to look at it. If a new car costs you $15,000 (or more) and a five year old version of the same car costs $5,000, the difference in price leaves you a lot of room to make repairs and still come out on top. That's not even factoring the additional costs involved in insuring and financing the more expensive vehicle.
Purchasing a second hand car has lot of Benefits. You can save money on car, car insurance, Sales tax and registration fees. Used cars loans are simpler and easily available.
I wanted to mention to all Thrifty car buyers to beware of the cost to replace parts on your economical car. I firmly believe the manufacturer does not make money on an economical car you purchase because they make up for the loss through the replacement parts you will need to fix your car. When thinking of buying a really reasonable car, please call a reliable automotive shop and ask them their opinion on common replacements and repairs. The prices I have seen for a common part are astronomical in price. More than a car payment!
I read once that if a car was constructed from scratch using nothing but replacement dealer parts, it would cost five times as much. Some profit margin!
Buying a used car - don't overlook the private seller. I've bought two used cars, with 60,000 miles on them, paid $200 each time and drove them another 80,000 miles with no major repairs. They were not pretty cars, but very dependable transportation.
By Betty G.
Don't even consider buying a used car until you find out how much your current car is valued. You can do this by going to the Kelly Blue Book website and it's free to find out. So if you decide to trade in your car you know what it's worth and you'll be able to find out how much you should really be paying for your new car as well. Talk to the dealer and have them give you all the information on the car IN WRITING, so you can check it out online and they can't jack up the price on you later.
Find out the value of your car. Also car buying advice, reviews and ratings about vehicles.
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I am about to start looking for a used car. I hope to buy a car that is a few years old. Does anyone have any good advice to use when I start shopping?
As someone already suggested, you can shop on the Internet for used vehicles in your are.
In both our cases, we started looking with dealer's and let them know what we were considering. I was looking for a new vehicle at first. Always bought new and drove them until they were ready to drop!
In talking with a salesman at a dealership, and he knowing that I was still looking around ... the sales manager stepped in and said, they just got a trade-in he thought I might be interested in and the price was very attractive. It had about 12,600 miles and was a year old and the new ones were due to come out soon. I test drove it. This was a new salesman and I felt like the sales manager was trying to help him make his first sale!
I had them run a Carfax, which was free. We bought the car. This was the first used vehicle we ever bought! I would do it again.
Hubby did the same approach, looking for a used truck with several dealers. Got several calls and after considering a purchase, had a "free" Carfax run on it and found that the vehicle was not a one-owner vehicle the salesman thought it was. He still bought the truck but negotiated the price down!
Being retired, this is the only way we'll will go, when looking for a "newer" vehicle.
Even if it is a Used Car, do your research!!!! Make sure that you find exactly what you want, whether it be something to get you from A to B or something that has a couple more "horses" under the engine. If you go into consumerreports.com (I think that's the web site) do research on the cars that you are interested in and watch for ratings. (Safety is always important to look at.) They always say "You get what you pay for", which is true. I got a base Mazda 3, a car that has style but is low-cost and really saves gas, a great thing nowadays.
Another thing is when you buy used, try a used car that is "gently used". It's already been broken into, has low mileage, and is thousands of dollars less than driving it out of a dealership in new condition. You save a ton of money that way.
As always, test drive the car, ask a TON of questions and make sure that the sales person is answering all of them (if that is the case, of course). If they don't know the answers, they don't know what they're doing.
Another thing. Between dealerships and personal sellers, it may be cheaper buying from someone on the other side of town, but with a dealer you get a warranty for a little while at least, just walk in smart and know your stuff. Then, they will be well aware that you know what you're talking about and they can't possibly scam you. Dealers have a bad reputation, and walking in there and knowing your stuff makes you five times better off than walking in blind.
One last thing, make sure that it is within your budget. I budget by pay periods (bi-weekly). I figure out what bills are due for that time and then theres regular expenses and maybe a birthday or wedding or something somewhere, budget that too and set it aside. When you have a couple of cars in mind, go online and use the payment calculator to see whereabouts your monthly payment will come up to. THEN, take that number, and add that to your bills and see if you can afford it. Budget budget budget, ugh, I hate that word, as do a lot of people, but it makes life that much more comfortable.
Before I purchase any used car I make sure the seller will allow me to take it to my mechanic for a thorough checking out. If not, I simply walk away.
If they are afraid of what my mechanic will say or find, I don't want it anyway. I also ask my mechanic if he knows of any cars he's worked on for sale. We got two really great cars that way. Good luck.
Thank you folks. Your advice was very helpful.
Here's what I did:
1) Searched on auto-trader http://www.autotrader.com
2) Bought the unlimited CarFax for one month deal (I ran over 40 vehicles!) http://carfax.com
And got a "asking price" of $6,900 to an even $5,800 for my 1998 Nissan Sentra and a set of four snow tires! I can highly recommend Sentras . . . especially because I get about 30 mpg around town and usually over 40 mpg highway. With gas costing as much as it does, my little car is worth its weight in gold!
Depending on where you live always check under the car make sure everything looks good. I live in NY and one time my father went to go see cars and he saw one that looked really good and the price was good also, so he wondered what was wrong with it! It seemed to good to be true....he checked everything and all was ok, he decided to get on his knees and look under the car and as expected something was wrong! it was all rusty and eatten up! Due to all the salt that is thrown on the ground when in snows! So check everything!!! Good luck!
My son is saving up for a car. He's not going to have a lot of money to spend so it's going to have to be a cheap, used car. Anyone have any car buying tips for buying a car through the paper? I have never done it before, i bought my car at a lot.
Ruth in CA
For a small fee you can research cars history (prev. owners, accidents, etc.) re : VIN number. Also make the sale pending a check by your own mechanic. Also, some cars are way cheaper to insure for everyone, and esp. young drivers.
Everything said about mechanical condition is important but I want to add that altho old and small, Ford Festivas are very economical. They get 40 to 50 miles per gallon, are very inexpensive to insure, buying tires is inexpensive and property taxes (if applicable in your area) are low. I have an 89 that has over 100,000 miles but is very dependable and comfortable. My husband drives a 91 model and thinks it is more peppy. We have a much newer Dodge pickup and a 1992 Oldsmobile but I actually prefer driving the Festiva as I can park it anyplace and don't worry about dings from other cars in parking lots etc. Many young people think such cars are beneath them unfortunately.
WE have had 4 1989 Olds 98 cars. Kinda sporty so our kids all drove them in high school. All of them got over 200,000mi. on them, mine now has 272,000. Cheap insurance, 21mpg in town, 25+ mpg on road. 2 of them were purchased with over 100,000mi. on them. The 1st one was a 1986 and had transmission problems just as consumer reports said. We like the bigger size for protection for our kid drivers.
We have run into two problems with buying used cars. First, check the availability of parts. My son found that he loves his older Jeep Wagoneer but CANNOT find parts. This has turned into quite a problem; we have looked everywhere! Then my other son bought an older Mercedes for a very good price, but the replacement parts are incredibly expensive, too expensive for him.
Go to your mechanic. Ask him if he knows someone who wants to sell what you want. This means he may have a history repairing the car, and know the owner as well.
Check out places in the Internet, like LATimes.com in the used car section, for listings and advice.
Read consumer reports. I like Olds, too.
i would like to know the cheapest car to run for a first time driver
Is there tax deduct for buying a certified used or used car this year?
By Wangliru from Warren, NJ
There is only one tax deduction associated with buying a car. If you itemize your deductions, you can claim either the state income tax you pay or the sales tax you pay. If you claim sales tax, the IRS has a table to calculate the normal sales tax for someone in your income bracket. You can claim the sales tax charged on your auto in addition to what their table calculates. It makes no difference whether the car is new or used. Your deduction is limited to the amount of sales tax charged.
There are deductions available for the purchase of hybrid cars, but you didn't indicate that. If you use your car in a trade or business, you can also deduct some of the cost,call your tax office for more info,good luck.
The good news is that with the state sales tax deduction, you can count amounts you paid last year on retail purchases to possibly help cut your 2007 tax bill.
There's some bad news, though. When this year began, this popular tax break expired, so it's up to Congress to decide whether to continue this tax break in 2008. Watch "Tax changes for 2008"
But while we can still claim it, let's examine whether the sales tax deduction can reduce what you owe Uncle Sam.
Making a tax choice
The first thing to note is that this deduction isn't an add-on; it will require you to choose. You must decide whether you want to deduct the sales taxes you paid or your state income tax amounts.
The choice is obvious for residents of the seven states that do not collect state income taxes but do levy state sales taxes: Florida, Nevada, South Dakota, Texas, Washington, Wyoming and Tennessee, which taxes only dividend and interest income.
The measure also allows for deductions of local sales taxes. This again benefits residents who pay local sales taxes in the non-income tax states, as well as some Alaska residents. Alaska has no individual income or state sales tax, but some jurisdictions do charge local sales taxes. New Hampshire also lacks an income tax (like Tennessee, it taxes interest and dividend income) or a state sales tax, but it does charge consumers a tax on meals and room and vehicle rentals.
While the provision will be a decided boon to residents of non-income tax states, congressional aide Sarah Stephens notes that the new tax break is available to residents of all states where sales taxes are imposed.
"All taxpayers will get the chance to choose which deduction to take," says Stephens, district director to Rep. Kevin Brady, D-Texas, who was one of the original backers of the law when it was first enacted back in 2004. "Basically, it will be up to the individuals to do the math and see which deduction, state income taxes or sales taxes, will save them more."
Figuring your sales-tax break
The sales tax deduction will be available to filers who choose to itemize their expenses on Schedule A. And they will have two ways to determine just how big their sales tax deduction will be.
You can claim the total sales taxes you actually paid based on the amounts shown on your receipts. Just be sure to hang onto those register tapes in case the Internal Revenue Service has a question about how you arrived at your deduction amount.
Or you can claim the amount you'll find in the sales tax tables, found this year in IRS Publication 600. Because sales tax rates vary from state to state, the Treasury Department and IRS have come up with different tables for each.
The sales tax deduction tables are based on the average consumption by taxpayers, taking into account filing status, number of dependents, adjusted gross income and rates of state and local general sales taxation.
Most taxpayers probably will opt for the ease of using the deduction amount provided in the official tables. But taxpayers should make sure they use the sales-tax deduction that gives them the biggest break.
"Every family would be a little different," says Stephens. "A family with a new baby might spend a tremendous amount of money outfitting a new nursery and find that they're better off adding up their actual sales tax receipts. They could look at the table and say 'We get a $450 deduction, but we've got receipts for $500.'"
Added sales tax break for cars, boats
There's also a combination option, notes Stephens, that could help consumers who purchased, and paid a hefty sales tax, on a car or boat. In these cases, taxpayers can claim the average sales tax deduction from the tables and then also add in the tax on the road or marine vehicle.
"It's conceivable that people who buy a car in a location with a high sales tax and moderate state income tax would do better by foregoing their normal income tax deduction, but until there's a little more clarity on just how the deduction will work, it's hard to know for certain," says Mark Luscombe, attorney, CPA, and principal federal tax analyst for tax publisher CCH Inc. of Riverwoods, Ill.
There is one other tax deduction. If you have a business, you can deduct the used car if it is used for business. You can also use the vehicle deduction if you are an employee who has to use your own car, for deliveries for instance.