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How to Negotiate with Car Salesmen and Get the Best Deal

How to Negotiate with Car Salesmen and Get the Best Deal

    Like lawyers and dentists, few people actually enjoy having to deal with car salesmen.  They’re a necessary evil that often leave consumers with a bad taste in their mouths because of the tactics they employ to get people to purchase a new vehicle.  Coming out of the negotiations with a new car and a great deal on it can happen, if you go about things the right way.

    Secure Financing Ahead of Time

    When you’ve decided that it is time to buy new vehicle, instead of heading straight out to the dealership, visit your local credit union or bank and secure financing in advance.  Car dealers make a lot of their profit on financing deals, and you can save a lot of money by getting your auto loan through a reputable third-party ahead of time.  Once you’ve done this, you’re ready to head out to the dealership and take a look at the vehicles, although it is a good idea to do some research in advance and figure out which ones you might be interested in.

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    Go In Well-Rested

    You’ll want to make sure you’re well-rested on the day that you go to pick out your new car.  Don’t go when you’re rushed or overtired, or after a long day at work.  You need to be 100% there mentally if you want to come out of it with the best deal possible.

    Ask to See the Invoice

    Once you’ve found the car you’d like to purchase and the dealer takes you into his office or cubicle to begin the wheeling and dealing, ask to see the invoice.  This will tell you all kinds of information about the car, but most importantly, how much the dealership paid for it.  Keep that figure in mind as you negotiate what you’re willing to pay.  Sure, they’re going to make a profit, but knowing that number can help you lead negotiations in the direction of minimizing their profit and lowering your overall cost.

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    Just Say “NO”.

    The first thing that you need to know when it comes to negotiating the price of the vehicle you’re interested in purchasing is that “NO” is your best weapon.  Arm yourself and be prepared to use it, possibly even multiple times. Don’t let them strong-arm you or sweet talk you into something that you would not be comfortable with. Take a cue from my 18-month-old toddler and say it like you mean it (head shake optional).

    Let Them Come at You With an Offer

    The dealer will ask you some basic information about yourself, such as your name, address, and so on.  Answer honestly.  Most will start off the price negotiations by asking you how much you’d like to pay per month.  An appropriate answer to this question that will throw them off their game is “I’d like to pay zero.”  You might get a chuckle or a “wouldn’t we all” type comment before the salesman resumes his attempts to get you to provide him with a magic number that you’d be willing to pay them each month for the privledge of driving the vehicle of your choice.  They might ask you what you are paying now.  If your car is paid off, answer “Zero.”  If you are still making payments, give them an honest answer. Do not make the mistake of giving them a price you’d be willing to pay each month.

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    For your best chances at scoring a good deal, make them come at you with an offer.  No salesman would tell you that the amount per month you’re willing to pay is a lot higher than the deal that you could possible walk away with.  Car salesman get a minimal salary for hanging out at the dealership, but can make their riches in the commission they earn by selling cars. Their goal is to maximize their commission and the profit for the dealership. Your goal is to minimize their commission and the profit they make to get the best deal on your new vehicle. Get them to give you a number, and when they do, it’s time to begin negotiating.


      Bring an Extra Set of Keys

      If you will be trading in a vehicle to help offset the cost of the new one, don’t leave home without taking two sets of keys with you.  One tactic that dealers try to employ during the negotiations process is to look at your car and then kidnap your keys.  If you bring along second key they can’t hold you hostage.  Just make sure to give them the key that is a cheap copy, not one with a fancy key-fob or remote.  The idea is, if negotiations go sour and they try to hold you captive while hanging on to your keys, you can walk right out the door without having to worry about getting the key back.  They’re not expecting this, and will chase after you with promises of a better deal.

      Inform the Salesman That You Already Have Financing & Finalizing the Deal

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      Do not, I repeat, DO NOT inform the salesman in advance that you’ve already secured financing.  Keep this a closely guarded secret until the time is right.  If they know that you already have financing, it will change the way they deal with you.  The time to make the big reveal is once you’ve agreed on the final price of the vehicle.  Your credit union loan or other third-party auto financing will likely have better rates and terms than what the dealer is offering. At this point, pull out your calculator and utilize your financing details to figure out how much you’ll be paying in the end.  More than likely, it will be less than what you would have paid had you used dealer financing.

      Conclusion

      Follow this advice and I guarantee that you’ll walk out of the dealership with not only a new car, but also the satisfaction of knowing that you got the best deal you could have gotten. It feels a lot better than getting screwed out of hundreds or thousands of dollars.

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      Julie McCormick

      Julie McCormick is a writer, and co-owner of The Cleveland Leader, a Technorati Top 1000 site.

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      Last Updated on June 6, 2019

      The Average Retirement Savings and How to Save Wisely

      The Average Retirement Savings and How to Save Wisely

      Are you on track for retirement?

      If not, don’t worry, I’m not sure either. I save each month and hope for the best.

      Fortunately, I’m at an age where most people don’t save so I’m ahead of the curve.

      But, what if you aren’t in your 20s? What if you’re near retirement and are looking to gauge where you stand?

      If so, keep reading. Here’s how to prepare for retirement and save wisely during the process.

      What Does the Average American Have Saved for Retirement?

      Saving for retirement is tricky.

      Tell someone straight out of college to save $10k a year for retirement and it’ll be next to impossible.

      Make the same request to someone decades older and they’d be more likely to be able to save this amount. But, a 20-year old college student can be “financially ahead” of someone saving more than them. Why?

      Age matters in your financial journey. The younger you are, the more time you have to save and put compound interest to work. As you get older and have more saving power, you’d have less time to put compound interest to work.

      Here are the average savings Americans hold by age bracket:

      20’s – $16,000

      During this stage, most people are paying loans and moving up the corporate ladder. Your best bet during this stage is to focus on eliminating debt and increasing your income. Don’t focus only on getting a high-paying job neither.

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      Instead, focus on learning via Podcasts, reading books, and taking specialized courses. Doing this will make you more valuable and give you more career options.

      30’s – $45,000

      At this stage, you’ve hopefully escaped your entry-level salary and work at a career you enjoy. Your earning power has increased but you now have more obligations. For example, marriage, kids, and a mortgage.

      Set a plan to pay off all your debt and focus on eliminating unnecessary expenses. Leverage financial tools like Personal Capital to ensure you’re on track for retirement.

      40’s – $63,000

      This is the stage where you’re at the prime of your career. Top financial institutions recommend you have at least 2 to 4 times your salary saved up. If you’re falling behind, start maxing out your 401K and Roth IRA accounts.

      50’s – $115,000

      During your fifties, you’re close to retirement but still, have time to save. You may be helping your kids pay college tuition and other expenses. Since you’re at the peak of your earning power, max out all your retirement accounts.

      60’s – $172,000

      By this point, you should have about eight times your salary saved up. If not, you’ll depend primarily on social security benefits averaging $1400 per month. Max out all your retirement options as much as possible before retiring.

      Ways to Save Money on a Tight Budget

      The sad reality is that most Americans aren’t saving enough for retirement.

      Even high-earning power isn’t enough to secure one’s financial future. You need to have the discipline to save for retirement while time is in your favor. Don’t wait for you to have a high salary to save, start with having a small budget.

      First, get a clear picture of where you stand. Write down a list of “needs” and “wants.” For example, Netflix and Amazon Prime are “wants” and a “cell-phone” is a need.

      Use tools like Personal Capital to analyze your spending patterns. Personal Capital allows you to add all your financial data in one place–making it a powerful option to gauge where you stand.

      Once you know all your expenses, organize them from highest to lowest expense. When you can’t cut more expenses, call your service providers to negotiate a lower price. If you’re not good at negotiating, use services like Trimm to lower your monthly expenses.

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      How to Save Money Each Month

      By this point, you know the average amount of money you should have saved for retirement based on your age.

      But, breaking this down into monthly goals can be challenging. Here are some rule of thumbs to follow:

      Aim to contribute 10%–15% of your salary each paycheck. Review your progress each week.

      Why so often? The reality is that life gets in our way and you will have many financial setbacks. Your goal isn’t to be perfect but to get back on track instead.

      Reviewing your finances weekly lets you know where you stand with your retirement. This doesn’t have to be a long process either. All it takes is login in Personal Capital to view your net worth and check how much you have saved for retirement.

      Turn saving into a game and aim to save more each month. It will get challenging but you’ll get creative and find more ways to save.

      Top Money Saving Challenge Tips

      To prepare for your financial future and not be another statistic you need to be different.

      How?

      By adopting new habits that’ll help you become a saving machine. Here are some ways you can save more:

      Automatically Contribute Towards Retirement

      If you’re working for a company, you can automatically contribute towards your 401k. If you’re not currently contributing more than 10%, make this your goal. Contribute 1% more today and automatically increase this amount a year from now.

      Odds are that you’re not going to be negatively affected by contributing 1% more. Many times we spend our money on things we don’t need. Contributing more towards retirement is a great way to secure your financial future.

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      Use the Right Tools to Know Where You Stand

      Once you’re contributing more towards your retirement accounts, gauge your progress. Make use of finance tracking apps to help you view the big picture of your retirement.

      When I’d first signed up for the app Personal Capital, I didn’t know I had a negative net worth. Despite saving thousands of dollars, my debt brought my net worth to the negative. Knowing this motivated me to save more and spend less.

      Now, I have a positive net worth. But, it was because I was able to view the big picture using the app. Find out what your net worth is using a finance tracking app and you may surprise yourself.

      Bring in Experts to View Your Blind Spots

      If you have too little or too much money saved, you should consider hiring financial experts.

      Why?

      You may need someone to hold you accountable to help you reach your financial goals. Or, you may need help managing your money as effective as possible.

      Regardless of the reason, getting help may help improve your financial situation.

      Before you hire an expert, find out which areas you need help the most. For example, if you’re constantly overspending, find a debt counselor. If you’re struggling with choosing the best investment options, hire a financial advisor.

      Speed up Your Retirement Contribution

      After learning how to manage your money well, the next best thing is to earn a higher income.

      You’re capped at how much you can save but not much you can earn. Even if your employer isn’t giving you a promotion, you can still take charge of your financial future. How?

      By starting a side-business.

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      This will be something you’d work on after you’ve finished your day job. Once you start earning income from your side-business, you’ll be financially better off.

      The best part is the more work you put into your side-business,[1] the more potential it has to earn more money.

      So start a side-business in an area you’re familiar with. For example, if you enjoy writing, do freelance writing for small e-commerce businesses.

      Once you’re earning a higher income, you can contribute more towards your retirement. Don’t wait for the right opportunity to secure your financial future, create one.

      Reach Financial Freedom with Confidence

      What if you were able to retire tomorrow with no problem, all because you’d have enough money saved up and little to no debt left to pay off? How would you feel?

      My guess is that you’d feel happy and relieved.

      Most Americans are falling behind their retirement goals for many reasons. They’re not prepared, they carry bad money-habits and are thinking short-term.

      For you to retire successfully, you need to work backward and adopt better habits. Contribute more towards your 401K and focus on growing your income.

      If you do, you’ll save money and pay debt faster.

      Don’t beat yourself up if you’re behind your retirement goals. Take the first step today towards a brighter financial future. Isn’t retirement worth the hard work and sacrifice to be at peace?

      Featured photo credit: Huy Phan via unsplash.com

      Reference

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