After a house, a vehicle is probably the biggest purchase you'll make. Unfortunately, while your house might appreciate -- that is, gain value over time -- your car will eventually turn into a nearly worthless hunk of metal, plastic and upholstery.
Rather than pour oodles of cash into something whose value is going to drop like a rock, use these 10 tips to spend as little as possible on a vehicle that will safely serve you for years.
1. Buy used … usually
You knew this would be the first bit of advice, right?
Of course it is. How could it not be when Edmunds reports that the average new car loses 11 percent of its value as soon as it's driven off the lot? That means your $20,000 car is suddenly worth less than $18,000. Then, after five years, it will likely be worth only slightly more than $12,500.
2. Do your homework
Regardless of whether you're buying new or used, you need to do your homework first. That means researching the going price and available options for the cars you're eyeing.
Of course, KBB and Edmunds are good places to start, but don't stop there. These sites tell you what cars should be selling for, but, in the end, capitalism rules. Supply and demand where you are will dictate actual prices.
3. Get your trim right
OK, this one might seem silly to the gearheads in the audience, but for everyone else, make sure you're doing an apples-to-apples comparison when shopping around.
I'll go ahead, risk looking the fool and confess to this mistake. I recently bought a Toyota Sienna with an LE trim but was comparing it with vehicles with an XLE trim when doing online research. It wasn't until after I got the vehicle home that I realized my mistake.
4. Embrace high miles
I don't think I even owned a car yet, but I still remember that old Kia commercial with the car driving until the odometer on the roof rolled over to 100,000. Wow! The car was so cheap and yet you could still get 100,000 miles on it. It was downright amazing!
5. Time your purchase right
There are two facets to this piece of advice.
The first is to buy on the right day. As you might guess, the end of the month is often a good time to buy a car, particularly if salespeople are trying to meet their quotas or qualify for a monthly bonus.
6. Forget the monthly payment
We drive by a car lot on our street nearly every day. Right on the corner is a shiny new SUV with "$198" plastered to the side. My obviously not-yet-money-savvy teens and tween have all on separate occasions oohed and aahed over the car and its low, low price.
7. Don't mention your trade-in
Along the same lines, don't mention your trade-in unless it absolutely has to be part of the transaction because you still owe on it and can't afford two payments. However, in that case, I would gently suggest you consider whether it would be better to wait until you've paid off your current car before buying a new one.
8. Think twice about trade-in promos
Another trick dealers use is luring in shoppers with promises of huge trade-in values. If you can push, pull or drag in your old vehicle, you'll be guaranteed thousands of dollars for your trade-in.
9. Offer to pay with green
Buying with cash is a strategy that may or may not get you a discount.
New-car dealers make more then 20 percent of their income (.pdf file) on financing and insurance sales, which means they have little incentive to accept cash. On the used lot, you might get a little more negotiating power, especially if there is a smaller financial incentive for the dealer and the salesperson is eager to avoid the hassle of completing financing paperwork. In my case, paying with cash dropped the price about $500.
10. Buy from private sellers
Speaking of private sellers, you're likely to get a better deal from them even if you don't do any wheeling and dealing. That's one way Money Talks News finance expert Stacy Johnson found a near mint condition $5,000 car.