The following post is one of a series of articles I am writing detailing our recent cash purchase of a “new” family vehicle. From deciding which make and model to buy, to closing the final deal, follow along on our car buying adventure!
As our young family has grown, my wife and I are considering the purchase of a larger vehicle that is more accommodating to our needs. After 7 years of faithful service, our beloved Volvo S40 sedan with 160,000 miles is reaching the limits of its practicality as a family vehicle. Additionally, the logistics of being a busy “one car” family in a rural Maine town is becoming an issue in itself.
Having followed the financial plan outlined in the Dave Ramsey’s book The Total Money Makeover over the last 5 years, I knew I was going to approach this car purchase a little differently from some I have made in the past.
From my college graduation day in early 1999 through 2003 I had accumulated over $90,000 of non-mortgage consumer debt, a good portion of which was related to expensive new vehicle purchases that I had leased or purchased unwisely (including our current vehicle). I had a decent income, but unfortunately, I used it as leverage to finance stuff I otherwise couldn’t afford.
Thanks to Dave Ramsey, and his excellent step by step plan for getting out of debt, we gradually paid off this debt and began saving money to pay cash for our next vehicle. For once in our financial lives, we actually had a plan.
Beginning the car buying process before our current car was no longer functional allowed us time to establish the criteria that our new vehicle had to meet. We would have time to test drive cars, research prices, and get insurance quotes to help us determine what vehicle had the best overall value and was best suited for our situation.
It’s amazing how my perception of money and debt have changed over the last few years. 5 Years ago, no matter how much money I had saved for a vehicle purchase, the “old me” would have taken that amount and put it as a “down payment” on an even more expensive vehicle. Then I would’ve borrowed even more to cover the remainder of the vehicle’s sale price!
Although some would argue that paying cash for a vehicle is not always practical, we knew that doing so is the right thing for us. We also realized that we would most likely be purchasing a slightly used vehicle to get what we wanted within our budget.
Read the Entire Series:
Part 1: We Need a New Car
Part 2: The Case for Buying a Used Vehicle
Part 3: How We Decided Which Car to Buy
Part 4: Determining a Used Vehicle’s Fair Price
Part 5: Our First Attempt to Buy a “New” Vehicle
Part 6: Negotiations With an Auto Dealership WE BOUGHT A CAR!
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