Buying a Car in the Digital Age

A couple of months ago I found myself in the market for a "new" car. Now, what I bought is not the important part, the important question is "how does a Financial Literacy and Entrepreneurship teacher with an MBA go about finding a car to purchase?"

I feel that this is an important question to be answered because people who need personal transportation should view a car as a tool, a machine, or a function... despite all the marketing to evoke an emotional response. If you need a car, it needs to be safe and reliable transportation from point A to point B.

As I have been updating the Car Purchase Activity curriculum for Financial Literacy, I find myself reflecting on how important this information could be for my Entrepreneurship students as well. Part of boot-strapping any new company includes the thrift as well as the marketability of company vehicles. After all, a company only looks as good as the vehicle's it uses.

How to find the best vehicle "your" money can buy.

The Internet is your friend, especially classifieds websites such as Facebook, Truecar, and KSL Classifieds. Mr. Lewis and I are both big fans of the classifieds. Buying items during the "off" season is a great way to save money on things that you don't need right now. Snow Blowers in the Spring, Lawn Mowers in the Fall.

This will help you program the search features of the classifieds site to give you the best value on that site, at that particular time. (Remember, classifieds are always changing so if you don't find what you're looking for, at the price you are able to afford, then just wait a few weeks and try again. There are very few "one-in-a-lifetime" opportunities in this world, despite what the advertising wants you to believe.)

Step 1:

Select the body style you want and run the search.

Step 2:

Complete the "Price To" box with the price you are willing to spend. Submit the search

Step 3:

Fill out the "Mileage To" box with the highest mileage you are willing to accept (generally under 100,000 but whatever you're comfortable with even up to 150,000 miles). Submit the search.

Step 4:

If available, find the "Title Type" and put a check mark in the option for "Clean Title." Submit the search. (Clean Titles means that there are no MAJOR issues with your ability to register and own the car. All the other title classifications mean that the car has been in a major accident or police incident like grand theft auto. Buyer Beware)

Note that we have not filed in the Year section. Instead we are going to sort the list by year.

Step 5:

Find the "sort result by" drop down. Select Newest to Oldest Model Year.

The top results are your best buys. These are the newest vehicles with the lowest miles for the cheapest price. You won't find a better deal on the classifieds than your top choice with a few provisos. The top choice will not consider color, specific vehicle options or any other "wants." These results are purely functional.

So drive forward, good shopping and remember, sidewalks are for pedestrians.

Next Post: Auto Financing - The myths, maths, and minutia!

Questions:

1. Complete a car search using the above steps. Describe the car that Truecar suggested to you for purchase?

2. If you are not happy with the search results what would you do?

3. Why is Step 1 really Step 2 (consider your budget and savings)?

Resources:

Lecture Guide

PowerPoint: Car Loan Experience

Teachers Pay Teachers Files