Download - Buying Your First Car
Buying Your First Car
• Buying a car• Buying a new iPod touch• Buying lunch• Buying a house• Going to prom
Average Prices• Buying a house: $177,900• Buying a car: $30,000• Prom:
– Girl: $400-$600– Guy: $200-$400
• Buying an iPod touch: $299• Buying lunch: $9
Bottom Line?
Next to buying a house, buying a car is the biggest expense most people face
Terms to Know• Dealer Invoice Price:
– The price the dealer has paid the manufacturer for the car
• MSRP: – Manufacturer’s Suggested Retail Price– Usually appears on sticker– Ex: Nordstrom Rack
• Sticker Price:– The price the dealership is asking for a new car– Will include additional fees due to transportation
costs, dealer prep (washing, gas), etc. • Actual Selling Price:
– Price you negotiate!– Why might stores charge different amounts for the
same car?
Terms to Know• Base Price: – The cost of the car without options, but
includes standard equipment and factory warranty
• Ownership Costs: Fixed – Purchase price– Registration, title, license plate
• Operating Costs: Flexible – Gas– Tires– Oil changes
Terms to Know• Book Value:– the value of a used car listed in pricing
books (Kelley Blue Book)– www.kbb.com
• Asking Price:– the amount a seller wants for his/her
used car (you may be able to buy the car for a slightly lower price than this)
Do Some Research• You’ll be less likely to feel pressured
into making a hasty or expensive decision and more likely to get a better deal.
Questions to Ponder• How much can I afford to
spend?• What is the cost of car
maintenance?• Where is the nearest shop that
services the kind of car I want?• Are parts readily available for
the kind of car I want?
Let’s Practice: Reading a Sticker• $20,000• $26,000• $28,000• Range: $20,000-$28,000+–Would they ever charge more than the
sticker price? Why?
Let’s Practice: Name That Car
• There are approximately 48 different car companies that you can choose from in the U.S.–Make: Manufacturer (Ex: Ford)–Model: Type (Ex: Mustang)
• How many can you identify??
• 1) Ford Mustang– $
• 2) Ford Explorer– $
• 3) Audi S5– $
• 4) Dodge Caravan– $
• 5) Minicooper-S – $