Buying a sports car in the midst of a midlife crisis is not a good idea. If you’re looking for me to co-sign that behavior, move along. That’s not what this article is about. I’m also going to refrain from telling you not to buy a Tesla. Elon Musk claims their share prices are too high. Was he being altruistic? Don’t believe it. He scored $700 million on an options deal after that rant.
What we will discuss today is timing. When is the best time to buy a car? I’m going to break it down for you so you can choose the correct month, week, day, hour, and minute to go auto shopping. Okay, maybe not down to the minute, but there are hours during the day that are more optimal for a car quest. Let’s take a virtual ride together and find out why that is.
Preparations For Buying A Car
Purchasing a new vehicle should not be an impulse buy. Before you hussle out of the house for that President’s Day Sale, there are two things you need to know. First, February is not the best time of year to buy a car. It’s actually one of the worst. Second, consumers who rush into major purchases generally pay more than they should. Do the following to avoid this:
- Shop Online First to Compare Prices: Figure out what kind of vehicle you want and do some online shopping. No one wants to buy a car without driving it, but you’ll be able to make a better deal if you understand more about standard features, MPG, and available options, not to mention sticker price. Knowledgeable buyers get better deals.
- Ask your Bank for Pre-Approval: It’s mind-boggling how many consumers ignore this step. The bank that handles your personal accounts will give you a better interest rate than any car dealer. That statement should speak for itself. Get bank or credit union pre-approval on financing before you go anywhere near a dealership.
- Don’t Buy The First Car You Test Drive: Car salespeople are pushy and will tell you all about “limited-time” offers. Don’t fall for it. Dealers are desperate to offload their inventory. Use the word “no.” It’s a powerful negotiating tool. Pass on the first car. Shop a little more. Leave and come back tomorrow. That “sweet deal” will get sweeter.
Sales Motives And Consumer Timing
Here’s your first time tip. The best months to buy a car are December, March, June, and September. Why? Those are the months that close out fiscal quarters. Like any business, an automotive dealership wants their EOQ closing numbers to be strong. Salespeople are driven to close more sales during those months. That opens up opportunities for you to get a better deal.
December is the best month of the year to purchase a new vehicle. It’s not just the end of a fiscal quarter. It’s the closing month of the fiscal year. Why do you think you see so many car commercials during the holiday season? Manufacturers release new year models and dealers want to drive sales numbers to clear out current year inventory.
Take all this to the next level. Salespeople are pressured to move inventory during the last month of a quarter. How much more intense is that pressure during the last week or last day of that month? Patience is hard when you covet that shiny new convertible. Stay strong. Waiting until the time is right can save you thousands of dollars. That’s worth the wait.
Negotiating The Right Price And Terms For Buying A Car
Timing isn’t just about when you go to the dealership. Getting the price and terms that you want is dependent on how you negotiate with the salesperson. Much like a game of chance, you don’t want to tip your hand too early. Follow these suggestions:
- Know What You Can Afford: Knowing how much you should spend on a car is important. You don’t want to buy more car than you actually afford. Reviewing your budget before going to the dealership will give you insights into how much you can add to your monthly expenses without financial unmanageability.
- Set a Purchase Price Goal: The first step was about fitting a monthly payment into your budget. A purchase price goal is for the total price of the vehicle. How much debt are you willing to take on? This is a good place to read up on debt to income ratio.
- Negotiate Based on Vehicle Cost, not MSRP: After deciding on which vehicle you want, start the negotiations by asking for the vehicle cost to the dealer. It’s on the invoice and they are obligated to tell you. Negotiate up from this number, not down from the sticker price. Offer $500 over invoice. They won’t take it, but it’s a good place to start.
- Sales Don’t Necessarily Mean Savings: Ignore “discounted” prices. They are often disguised ploys by the dealership to get rid of unwanted inventory. Automobiles are usually marked up in price before that “savings” is tacked on.
- Don’t Buy the Extended Warranty: Wait until the end of your negotiation, then refuse the extended warranty when offered. Factory warranties are usually bumper to bumper for up to 100,000 miles. That’s all you’ll ever need. Extended warranties are a commission product for the salesperson. That’s why they push so hard for them.
There Are Exceptions To Every Rule
It might seem like weekends are the best time to shop for a new car. There’s usually a sale going on and you have more free time to spend wandering the show room floor. Unfortunately, everyone else is thinking the exact same thing. Dealerships are crowded on weekends. Shop early in the week and in the morning if you’re looking to negotiate a good deal.
On the other side of the time equation, waiting until the last day of a quarter may backfire on you. Sales quota deadlines sometimes hit prior to that. Give yourself some cushion and go a few days early. You’ll hit the prime deal window and still have time to go back if the numbers aren’t quite right. Savvy car buyers have an instinct for this.
Finally, though December is by far the best month to buy, you’ll likely find some really good deals in January also. Cars start depreciating the moment they roll off the assembly line. Any old inventory left over after the holiday rush needs to be moved out quickly. Don’t be afraid to test drive last year’s models. Many are identical to the new version, but much cheaper.
Final Thoughts: Best Time To Buy A Car
Buying a new car isn’t cheap, but now you know the best time to buy a car and save some cash. Use this guide to know when to buy and how to negotiate so you know you’re getting the best deal!
Once you’ve bought your car, you may need to invest in some things for it, such as tires. If so, you may also enjoy our article on the best time to buy tires. Now hit the road in your new wheels!