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First time Car Buying Mistakes to Avoid!

First time Car Buying Mistakes to Avoid!

Making a decision that’s tens of
thousands of dollars? Probably not a good idea when you got scarlet fever. Hi guys
it’s Akeiva and welcome to another episode of The Bemused where we talk all
things personal finance for young adults like myself so if you’re new here
consider subscribing! So tomorrow, August 8th, makes two years since I bought my
first car. If you guys don’t know which why would you know because I don’t think
I’ve ever told you guys this – I Drive a 2008 Toyota rav4 limited edition and I
mean honestly I love my car my car has not failed me in the two years that I’ve
had it and so it’s been a good experience with it. However the process
of actually buying the car was a whole different story. I did pretty much every
wrong thing you could think of when buying my first car so today in honor of
the anniversary of buying my first car I wanted to share with you guys some
first-time car buying mistakes to avoid. So to give you guys some backstory, I
bought my car summer of 2016. I had just finished a very lucrative internship
that had made me a decent sum of money that summer and so I used a good chunk
of it to buy my car. Now I will say that not all of my decisions were terrible I
mean one big common mistake that first time car buyers make is trying to buy a
car that you know they’re looking for all the wrong things in the car. They’re
looking for fancy features or things that they think they like or will use
that they never even really end up using and so that’s thankfully that’s one
mistake that I didn’t make. I literally use basically all the premium
features that I wanted it in my car I use them all the time but essentially I
needed a car because I was going into my senior year of college and I knew that I
was going to be living off-campus that year so I would need a way to get back
and forth without having to depend on other people to transport me from place
to place that’s just not the life I wanted to live and so I knew that I need
to get a car and also I knew that in a year my goal was to go to school out
here in Massachusetts. Mind you I hadn’t even applied yet I hadn’t even gotten in
yet but I was claiming by faith that I was going to school in Massachusetts where
they get a lot of snow so I was making sure that I bought a car that had
four-wheel drive so I can handle the snow out here and look how that turned
out so thankfully I didn’t buy a car that
had fancy uber fancy features or things that I just genuinely didn’t end
up using but that is a very common mistake with first time car buyers I
guess first time anything buyers you don’t really know what you need until
you have it to see if you’re gonna use it so be realistic with your features.
For me an important thing that I wanted in my car and the two most important
things that I wanted in my car was four-wheel drive and premium sound. If
you’re a music junky like I am make sure you comment below and let me know like
if you’re the type of person that listens to music from your phone speaker
all day I can’t trust people like that I like to put some respect on my music and
listen to it in the way that it was intended to be listened to I need to
hear all the nuances the bass everything I need to hear it so what was really
important to me was that premium sound and honestly I’m glad I did because
literally I I listen I can pretty much count on one
hand the amount of times I’ve driven without listening to music literally on
one hand I’m always constantly playing music in my car
but that did come at a pretty penny and so I didn’t have enough cash to buy
my car outright like I intentionally thought I would so I did end up financing my car I
bought my car at a dealership in New York and yeah it was just an interesting
experience and so everything kind of goes downhill from here.
So another first time car buyer mistake that I definitely fell into was not
researching the value of the car that I was buying like looking back it’s like
what in the world was I doing but anyway so one big thing that I
definitely should have done when I bought my car is doing the research on
the car check carfax check Kelly Blue Book see what this car is actually worth
this specific car with this specific VIN number just look it up and see what it’s
worth to make sure that I wasn’t overpaying for my car
like I said I did buy my car at a dealership so definitely there was gonna be a
little bit of a price premium there but I needed to make sure I wasn’t overpaying. So thankfully what I paid for my car I paid I paid I think about twelve
thousand dollars for my car and the market value at that time it wasn’t too
bad it was a little bit over I think the market value at that time was about
eleven thousand so I did pay a little bit more than I think I should have for
the market value of the car at the time but it wasn’t too crazy but still I
could have probably definitely negotiated them down a bit so that’s
another mistake and the third and final first time car buyer mistake that I want
to share that I definitely made is not getting pre-qualified for financing. So
legitimately what I did was I went to the dealer I said I wanted this car what
offer can you give me so I can finance this car and I literally just took
whatever the offer that they offered me which looking back it’s like that is
crazy and that is why now I have a seven point nine five percent interest rate on
my car. That is higher than any of my student loans which is crazy.
Am I having problems making my monthly payments? No. Are my monthly payments super
excessive? No. But that doesn’t mean that that’s what I should be paying every
month for my car. so if I’d
negotiated the base price down a little bit and if I had you know gotten pre-
qualified for financing you know looked at other lenders I probably could have
saved myself a whole lot of dough. Now let me talk about a couple of ways that
I have tried to remedy the mistakes that I’ve made. So right now basically my goal
is to not be underwater on my vehicle and underwater simply means I
don’t want to owe more than my car is worth so if my car is worth $10,000 I
shouldn’t be owing more than $10,000 on my car because then I have no equity in
my car like it’s just underwater that’s the term for it and so what I do right
now is I keep checking on my car value periodically now thankfully I use Carfax
and sites like that to look at the car the value of my car and make sure I’m
not underwater on that, which I’m not. Thankfully, I have about $2,000 worth of
equity in my car which is great so it means if I can that means that if I sell
my car today I should be able to profit $2,000 based on what I owe on the car
and what it’s worth today. if you see that you’re either underwater on the
value of your vehicle or your interest rate is super super high like mine
another remedy could be to try to pay down that debt faster so that you’re not
throwing away more money and interest which is something I’ve actually done
before I put like a little bit of a like a lump sum onto my car payment so I can
kind of get that down a little bit so even though you make mistakes there’s
still hope at the end of the day and honestly the most overarching mistake I
made in this entire process is the fact that I was sick -the sickest I have been
in my entire 21 years of existence is the time I chose that it was a wise idea
to go buy a car. Literally I was so sick I could not even drive my own car home
my mom had to drive it home for me like I insert a picture here I’ll decide if I
want to insert a picture here because you don’t even want to see what my face
looked like that day though I looked crazy. The weekend I bought my car
actually contracted scarlet fever – long story
I’m not gonna get into it today but point is I looked like death I felt like
death and I decided to make this huge financial decision while I was like sick
on my deathbed so you know that’s maybe not a common first time car buyers
mistake but definitely a mistake that I made so you know making a decision
that’s tens of thousands of dollars probably not a good idea when you got
scarlet fever so I hope you guys enjoyed this video hopefully it’s helpful to you
guys that are out there looking to maybe buy your first car maybe it’s not your
first time buying a car but you’re trying to make sure that the next car
you buy you do it right and so these are just a couple of common pitfalls that
definitely I fell into and a lot of other people fall into when they’re trying to
purchase a vehicle. Thank you guys for watching and I will see you guys next
time. Bye!

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3 thoughts on “First time Car Buying Mistakes to Avoid!

  1. Hey wealth builders! How was your first time car-buying experience? What’s your favorite song to jam to in the car at the moment?

  2. For someone who wants to spread knowledge about financial stability, you're doing a pretty poor job with this video. Your first car does not need to be worth 12k. Obviously you spend within your budget, and good for you that you can afford that, but for people trying to save money, this is not the way to do it. Don't finance your first car, buy used from private sellers, you can very often get an amazing deal. Don't think about the features of the car, it doesn't matter what the sound system is like if you're trying to save money. Make sure it's mechanically sound so you aren't dishing out money in repair costs. Find a car that has good gas mileage so you aren't shelling out an extra couple hundred dollars a year, find a car that has good tires already on it so you aren't forced to buy new ones, find a car that is proven to be reliable.

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