In this video, I'll be reacting to a list of things you shouldn't say when buying a car, based on a video made by a father-son duo who work at a dealership. Let's see if their advice resonates with me.
Reacting to Car Buying Advice
The video I'm reacting to is from a father and son who work at a dealership. They're sharing word tracks that salespeople use to guide customers towards closing deals. Let's see if I agree with their advice.
Company Philosophy
Before we get started, I want to share my company philosophy. My company is Ramsey, and we advocate for paying for cars in cash and only buying used cars until you reach Baby Step 4. We believe in the power of no debt, even with car purchases.
Word Tracks
The first word track is about monthly budget. The salesperson asks how much the customer wants to spend per month, and the correct response is to focus on the out-the-door price rather than monthly payments.
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Salesperson: "What's your monthly budget?"
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Customer: "I don't have one."
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Salesperson: "Well, how much do you want to spend per month?"
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Customer: "I don't know."
The second word track is about how much cash the customer plans to put down. The salesperson asks how much cash the customer has, and the correct response is to focus on the out-the-door number first.
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Salesperson: "How much cash do you have?"
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Customer: "I don't know."
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Salesperson: "Well, how much are you planning on putting down?"
The third word track is about trading in a car. The salesperson asks if the customer has a trade-in, and the correct response is to separate the transactions and focus on the out-the-door price first.
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Salesperson: "Do you have a trade-in?"
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Customer: "I don't know."
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Salesperson: "So, what value do you think it has?"
The video emphasizes that dealerships prefer customers who finance as it leads to more profit through interest and potentially higher car prices.
Gânduri Personale despre Sfaturi
I agree with most of the advice given in this video. It's important to know your budget and not be swayed by monthly payments or cash down offers. Using cash sets clear boundaries and prevents overspending on a car.
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Finance Manager Interaction
The video transitions to discussing interactions with finance managers at dealerships.
Finance Manager Questions
When finance managers ask about monthly payments or loan terms, it's important to be prepared with pre-approval from a credit union and understand where payments should fall.
Monthly Payment Considerations
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Finance Manager: "What payment are you looking for?"
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Customer: "I'm pre-approved at my credit union for 3% for 60 months, so I know my payment should be around $300."
Considerations Regarding the Loan Term
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Finance Manager: "What loan duration are you seeking?"
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Customer: "I'm pre-approved at my credit union for 3% for 60 months, so I know that's what I'm looking for."
The video recommends requesting a detailed cost breakdown for supplementary products such as extended warranties and to consider that financing these options incurs additional interest expenses.
Cash Consciousness
Using cash makes buyers more conscious of their purchases and less likely to overspend on add-ons or extras.
Final Thoughts on Car Buying Advice
It's important to do your research and have an intentional plan when buying a car. You are in control of the process, so don't be afraid to ask questions and stand firm on your budget.
Disagreement with Financing Options
While I agree with most of the advice given in this video, I personally disagree with financing options for cars. Cars are depreciating assets, so it's best to save up and pay with cash.
Resource Offer: Ramsey Car Guide
For more information on smart car ownership and maintenance without debt, check out our car guide linked in the description below!
Conclusion
If you found this video useful, please share it with others who might need guidance on negotiating car purchases without incurring debt. Remember, take charge of your finances to build a debt-free future!