Buying a new car can be intimidating: a big purchase that the buyer is often borrowing money for and will drive for a few years.
Question: I have been saving up for a down payment and want to start looking for a new car. I know that there are several times a year there are huge sales. When is the best time to buy a new car?
Answer: In life, timing is everything and buying a car at the right time could result in a huge difference between saving several hundreds or thousands of dollars on your next vehicle purchase.
Many car buyers go into a dealership ready to negotiate a good deal on a new car. Sometimes it pays off and other times you may feel like you received the short end of the stick. Doing detailed research ahead of time and waiting for the right time to buy is a better strategy.
If you want to buy a new car but don’t care about the difference between last year’s model and this year’s upgrades, then September and October is a perfect time for you. These months are usually the end of model year for many types of cars. Dealers and manufacturers want to get rid of prior year models to make room for new ones.
During holiday weekends, such as Labor Day, Memorial Day, Independence Day or Thanksgiving, you’ll often see or hear car dealerships advertising huge deals or blowout sales during these weekends. Automakers often offer special financing or cash-back deals for holiday weekends as well. Christmas Eve and New Year’s Eve can also be days to find some large discounts.
While the rest of us are using up our budget on holiday gifts, the dealerships are usually a little slower. As the year draws closer to the end, dealers are challenged to get rid of the prior year’s inventory and the sales teams want to earn those end-of-the-year bonuses.
The time of the month also can also bring about savings. The beginning of the month tends to have less traffic, therefore salespersons may be more willing to make that deal with you. Also, the end of the month may bring about some savings as sales teams want to hit their monthly quota, because there is usually an incentive or bonus. Sales teams may be more ready to work with you on a deal. The last week of December is especially good because of the double “ends” of month and year.
The time of day and the day of the week can also play a factor. Most people shop for cars on Saturdays and Sundays because they are off from work. Like with most retail stores, Monday and Tuesday are not as busy. Salespeople may be more willing to close a deal. Visit the dealership in the morning when people are fresh and enthusiastic and ready to make a deal. The earlier you get there, the better.
Michael Camacho is president and chief executive officer of Personal Finance Center. He has more than 20 years of experience in retail banking and at financial institutions in Guam and Hawaii. If there is a topic you’d like Michael to cover, please email him at firstname.lastname@example.org and read past columns at the Money Matters blog at www.moneymattersguam.wordpress.com.