women_on_wheels_car_buying_businesswoman.jpgBuying a new car is a big investment, and unlike real estate, it’s one that is sure to depreciate rather than appreciate over time and with use. So the first two questions that enter into any major expenditure should always be: (1) do I really need it, and (2) can I afford it? If you’ve answered yes to the first and a qualified yes to the second, then it seems like you’re ready to get a new car.

But if you’ve never bought a car before, or if it’s been a while, you might want to ask yourself the following eight questions before heading to the showroom:


What’s my budget?


Before you even step out of the house, you need to consider budget. Take a look at what you are earning and try and work out how much you can afford to pay in car dues monthly, given your living expenses, transportation expenses (including gas and parking), and other regular expenses. Are you planning to spend big bucks on other things in the coming year (e.g., a wedding, an extended trip abroad, down payment on property)? If so, you may want to consider whether you’ll be able to afford these plus the car, and if not, what you are willing to give up. For more details on creating a car budget, check out the relevant article published by the Unofficial DMV Guide.


How will I finance my purchase?

If you have the cash to pay for your new car in full, do so. You’ll end up paying much less—and this is true for both brand new and second-hand cars. If not, shop around for car loans. Ask your company’s HR department if there is a car plan you can avail of. Ask your bank about the rates for their car loans, and no matter how good your relationship with your bank manager is, shop around as well (plus if your bank manager likes you enough, you may be able to improve the terms of your loan if you can show him or her the offerings from the competition).


Should I buy brand new or second-hand?


Brand new cars obviously cost more, but more car plans are willing to cover them (though recently more banks like UnionBank or EastWest Bank have been offering pre-owned car loans), and the quality under the bonnet is assured. The same cannot be said for second-hand cars—and it will take a good deal of research to truly assure yourself of the car’s quality.

Basically, brand new is safe, but second-hand may be cheaper. We say “may” because if a car requires a lot of repairs or even overhauling, these may become comparable to the cost of a brand new car. So be careful about who you’re buying from, request a thorough history of ownership, and have a mechanic take a look at the car’s insides.

With the number of second-hand cars fished out of Ondoy floodwaters, you will also need to be wary of purchasing a once-flooded car. Generally speaking, these will be of much lower quality, no matter how professionally the owners may have cleaned them—a good mechanic should be able to tell whether or not a car has been through a thorough flooding.

Obviously, you don’t want to buy a car thinking of how much you’ll resell it for, but it’s a valid consideration to factor in. When buying second-hand, you also need to be informed about depreciation levels (e.g., why a four-year-old car that appears to be in good condition may cost less than a two-year-old car of the same model that appears to be less spiffy)—basically, the older the car, the cheaper its second-hand price.


What am I going to be using the car for?

Take a good look at your lifestyle and think about how you will be using your car 90 to 95 percent of the time.

Will you be driving around the city (e.g., to and from work, malls, or clubs)? Will you be going into the country every couple of weekends (or even every weekend)? Will you be transporting just yourself, or will you be bringing your kids to school? Are you going to be the only one driving it, or will your significant other be driving it as well? Do you have a driver?

These are all things to consider when you decide what car to get. If you’re going to have a driver most of the time and do virtually no driving, it should be all right to get a car with manual transmission. If you’re bringing your kids to school, you may want to get a seven- or nine-seater to make sure you fit your kids plus their yayas and belongings. If you’re a weekend adventurer, maybe get a sporty vehicle. If it’s a second car you’ll be driving yourself to work and back in, go for a compact sedan or hatchback. You don’t want a car that’s too big or too small for you, or one that guzzles gas when you only use it for city driving.


What features do I want my car to have?

Features are the plusses you can get with your car that can make your driving experience go from tolerable to great. They’re the “nice to haves” that aren’t required for you to drive your car, but are required for you to drive it with a smile on your face.

Safety

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To drive your car with confidence, you have to feel safe in it—if you worry that your car is going to turn into a death trap with every tiny bump, you are going to end up a nervous and paranoid driver and end up with sky-high repair bills only topped by insurance premiums. Common safety features you’ll want to look into for your car are ABS brakes (anti-lock brake systems), traction control, frontal and curtain airbags, crumple zones, and adjustable steering wheels, among other things.

Add-ons and built-in devices

You don’t want to make driving a chore, so you get things that make your drive more comfortable, even fun. Common add-ons are iPod docks, in-dash MP3 players, upgraded stereo systems, and in-car LCDs and DVD players. Connectivity devices like the Ford Sync or the Honda Music Link are also gaining popularity.

Luxury versus economy models

Some types of cars have an economy version and a luxury version—basically the same car with different trappings. Luxury versions may sport leather seats or wood paneling and other features. If this is something you’re interested in, that’s up to you, but just be prepared to pay the extra it’ll cost you.


women_on_wheels_car_buying_keys.jpgWhat cars will offer me low fuel consumption?

Generally, heavier cars with bigger engines consume greater amounts of fuel. However, you will also need to factor in other considerations. For example:

- Diesel cars will let you buy your fuel at a peso or two cheaper per liter and will consume less fuel as a rule, but will also offer you less power.

- Four-wheel drive vehicles will offer you better control, especially if you’re fond of out-of-town adventure trips, but they can increase fuel consumption by 5 to 10 percent when compared to their front- or rear-wheel drive equivalents, according to this article from BoulderCounty.org.

- Hybrids will consume less fuel but may require additional charging via plugging in, which may result in negligible differences to your overall spending.

- Cars with automatic transmission consume more gas than equivalents with manual transmission.

You’ll find you will need to go back to the question of what you’ll be using the car for in order to figure out which of your options will come out on top in the energy-saving department. For help with comparing fuel consumption and carbon footprints, check out the find-a-car section of FuelEconomy.gov, which is run by the US Department of Energy’s Energy Efficiency & Renewable Energy arm and the US Environmental Protection Agency (EPA).


What kind of car should I get?

If you’ve already decided on a hatchback or an SUV, then all that remains is to select the make and models you’re interested in. However, you may have decided on nothing more than your budget, and that’s fine too. You use car buyer's guides like the one offered by TopGear.com.ph to your advantage. These allow you to browse through different types of cars that are currently available; you have the option to browse by price range, classification (e.g., hatchback, hybrid, SUV, etc.), or engine.

Luxury classes and added options will of course cost extra, so you must consider what options are nice to have and what options you absolutely do not need.

One suggestion is to match the car to your lifestyle. You were asked what you were going to use the car for. You need to consider that. If you’re an adventurous person, always going on road trips, willing to take your car off the safe and paved roads, you may want to get a four-wheel drive SUV or pickup. If you want an economy car for getting you to and from work, you may want to look at a mini, hatchback, or sedan. If you’re looking for a car capable of transporting your family of five (plus yaya), look at multi-purpose vehicles or vans.

Also consider the cost of depreciation, which is just about always highest in the first year. You may want to check out car ownership cost charts from websites like the Internet Auto Guide, AutoSite, and CarPrice.com, which will list the amount of depreciation per year over a given period for each make and model (for example, a 2009 Hyundai Tucson may depreciate by around 28 percent in its first year, but a 2009 Toyota Camry would only depreciate by 17 percent). This may already suggest something about a car’s quality and it’s in-factor or the timelessness of its design—when your car is three years old, you’ll still want it to look good and not dated.


What sort of insurance should I get?

It’s generally best to get a comprehensive insurance plan. Paying the bare minimums will mean that if you get into a big accident, you’ll still need to pay out big bucks—sometimes even if it isn’t your fault. “But I’m a good driver,” you might argue. That may be the case, but consider the number of people who aren’t good drivers. And remember that jeepneys and taxi cabs only come with the minimum of insurance.

Also, in the wake of Ondoy and the prediction of more natural disasters having their effects worsened by poor urban planning, disaster prevention, and emergency response, you may want to make sure there is an Acts of God clause (which means that your insurance will cover disasters that cannot be caused or prevented by man) in your insurance plan.


If you have narrowed down the list of cars you’re interested in getting and you have worked out issues like financing and insurance, you’re ready to go to the show room. Make sure you test drive the cars you’re thinking of getting. As much as possible, try to drive these in places you’re likely to travel, and to get a good comparison, try to drive through the same routes in each car—this is why it would be best if you can visit a showroom near your home or workplace.

You should also read up on what not to do when buying a car; check out ConsumerReports.org’s guide to new car buying for this. And if you have a car-savvy friend or two, it’s always worth it to bring them along when car shopping—even if you have to bribe them with a free meal, their opinions may make the difference between being ho-hum about your car choice and extremely happy.


(Photo of businesswoman with car by Valerij Zhugan via sxc.hu; car keys photo source: sxc.hu)

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