Car Buying Plan

Why Having a Car Buying Plan Matters

Hey everyone! Let’s talk about something that doesn’t always cross our minds until it’s too late—having a plan for your next car. Even if you’re planning to drive your current vehicle until the wheels fall off, at some point, you’ll need to make a move. Being prepared can make all the difference, so let’s dive into why it’s important and how to get started.

The Unexpected Happens

Car buying often happens out of necessity. Maybe your car breaks down, you get into an accident, or something unexpected forces you to replace your vehicle. If there’s no plan in place, you could find yourself scrambling to make a decision under pressure. Insurance companies usually give you about seven days to figure things out if they total your car—imagine the stress of having to rush into a major financial decision like that.

Just like investing money for the future, whether it’s short-term, long-term, or for a specific goal, planning ahead for a car purchase can set you up for success. When people buy a house, they plan, save for a down payment, and finance it strategically. But when it comes to cars, most people don’t think that far ahead.

Step 1: Know What Your Current Car is Worth

If you’ve had your car for five, six, or even eight years, the first step is understanding its value. This matters whether you owe money on it or own it outright. Here’s how to do it:

• Get a professional appraisal. You can go to CarMax, Carvana, or use online tools to get an estimate.
• Avoid guessing. Just because an online tool says your car is worth $20,000 doesn’t mean that’s what you’ll actually get. An appraisal gives you a real number to work with.
• If you own your car outright, this number tells you what you have as a potential down payment for your next car.
• If you still have a loan, compare the appraisal value to what you owe. If your car is worth more than you owe, great! If not, that’s an important piece of information to factor into your plan.

Step 2: Understand Your Financial Position

Surprisingly, a lot of people don’t even know how much they owe on their car. If you’ve had a five or six-year loan and are three years in, it’s easy to lose track. Check your bank or lender account and find out the exact payoff amount. Write it down and compare it to your car’s value. This gives you a clear picture of where you stand.

Step 3: Make a List of Must-Haves for Your Next Car

Think about what you like in your current car and what you’d want in your next one.

• Do you need a backup camera?
• A large touchscreen?
• Heated and cooled seats?
• Towing capacity for a boat or camper?
• More passenger space for a growing family?

Your lifestyle might have changed since you bought your last car. Maybe you don’t need to tow anything anymore, or perhaps road trips are more important now than they were before. Writing down your must-haves will help guide your search when the time comes.

Step 4: Check Out Current Vehicle Costs

One reason people avoid planning is because they don’t like the numbers they see. Maybe your last car was a lot cheaper, and now new models are priced higher due to inflation. Instead of avoiding it, take a look at current market prices.

• Go online and build a few cars to see pricing.
• Call an auto broker (like me!) to get real-world numbers.
• See what monthly payments might look like based on financing or leasing options.

If the numbers aren’t where you’d like them to be, at least you know what you’re working with. Ignoring it won’t make it cheaper later.

Step 5: Assess Your Current Car’s Reliability

If your plan is to keep your car as long as possible, understanding its potential repair costs is key.

• Talk to your mechanic about major potential issues.
• Find out how much an engine replacement, transmission repair, or other major work might cost.
• Compare those numbers to your savings or emergency fund.

Knowing what to expect can help you prepare financially and decide whether holding onto your car makes sense.

Step 6: Start Saving Now

Most people don’t want to start making payments on a new car before they have to, which is understandable. But setting aside money in a separate savings account for your next car can make things easier when the time comes.

• If you think a new car will cost $50,000, start putting money away now.
• If you’re planning to finance, get used to making payments by transferring that amount into savings each month.

It’s like lifting weights—you’re building financial muscle so that when it’s time to upgrade, it’s not a burden.

Step 7: Consider Acting While Your Car Still Has Value

If your car is getting older but still holds value, trading it in before major depreciation hits might be a smart move.

• You could use its value as a down payment.
• You might qualify for a zero-down lease, keeping more cash in your pocket.

Either way, planning ahead gives you options rather than forcing a rushed decision.

Final Thoughts

If your car is approaching that eight-year mark (or older), take a look at your options now. Knowing your car’s value, potential repair costs, and replacement costs will save you from stress later. If you ever need guidance, I’m here to help.

I’m Ronnie Haskins—reach out anytime, and let’s make sure your next car purchase is a smart and stress-free one!