As a Millennial or Gen Z shopping for your first set of wheels, it can be intimidating. Not only is this your first time buying a car, but it’s the first time you’re applying for graduate finance. While it is certainly overwhelming at first, you need to think beyond your dream ride and more about where you’re going to find this car. Are you willing to deal with car dealership agents or private sellers?
Here are some tips on how you can make your first buying experience smooth and simple.
Invest in a quality vehicle
As much as this article isn’t about investing, nor does it offer investment advice for graduates, you must see your vehicle as an investment. Although it depreciates, a car is still an investment, and when chosen correctly, it can serve you for several years. This is why it is necessary to purchase a quality car that can last you at least five years. Purchasing a vehicle with a good track record will ensure you get to use it to the fullest, without experiencing many troubles. Although many would all love to purchase a brand new car, sometimes it is not feasible. So, when choosing a second-hand car, make sure it has low mileage, and it is a vehicle known for being durable for college graduates.
Consider buying a second-hand vehicle
The smell of new car seats may be appealing, but you need to ask yourself if it makes financial sense for you to buy a new car. As mentioned before, most people would love to buy a new car, but the price of a new vehicle, and how fast it depreciates, is not the best choice unless you have the financial means to afford it. Yes, you can get car finance in South Africa for graduates; however, you still need to make those repayments, and it is in your best interest to stick to one that you can afford.
Keep in mind that when buying a car in South Africa using financing, lenders require you to pay for car insurance. So, you need to calculate how much your insurance, maintenance and petrol will be each month. This is why buying a used car makes more sense as you will have a lower monthly repayment and you can save money. The rest of your budget can cover the costs of owning a car.
Understand the process before searching for a car
Before going on a quest to find a vehicle, make sure you understand graduate finance. (The great news is that you’re not required to have a credit history.) When you apply for vehicle finance and go through the car finance application process, make sure that everything is discussed up front before you’re required to make any commitment. Lenders have vehicle finance calculators on their websites to help you get an idea of how much you will need to pay, the interest rate and the loan term. Knowing how much your auto loan is, is key to guiding your search for a car you can afford.
Do an online car search
Since younger generations, particularly, new graduates, are known for being tech-savvy, why not use that to your advantage? Instead of going into a dealership, spend time online and search for the vehicle you’re interested in. As we know, sales agents can be pushy when it comes to a sale, so a good tip for buying your first car is to do almost everything online. That way, you can find the vehicle you want without feeling pressured into making a purchase. Going the online route is also helpful as you can shop around and read reviews to get an idea of what it would feel like to own a certain car. Going dealership to dealership just to look at a vehicle is time-consuming and can be stressful, especially if you don’t know how to deal with sales reps who are eager to make a sale.
Test drive more than one vehicle
As much as you can have an idea of the type of vehicle you want, you need to test drive more than one to see if your option was everything you thought it was. Test driving is not only for you to see if there are any issues with the car, but it is also to see if you enjoy the vehicle and if you see it fitting into your lifestyle. Of course, you will have to work within a budget, but there is no harm in testing a few vehicles out to see what works for you. Plus, there are many affordable cars you can buy in South Africa that can fit into your loan agreement. Here are some tips and things to look out for:
- Do your homework on what type of car is suitable for your current lifestyle.
- Make an appointment with an agent before going to the dealership.
- Have a list of features you want in your car e.g. Bluetooth connector, blind stop alert, WIFI hotspot or USB charging outlet.
- Have someone you trust accompany you on this adventure.
- Make sure you feel comfortable when you ride and operate the vehicle.
- Find out what the fuel economy is for the car.
When test driving:
- Walk around and check the exterior.
- Check the hinges and if the doors open and close properly.
- Check to see if the air-con and everything else in the car works.
- Listen for unusual sounds.
- Take note of the steering wheel and brakes.
Do not rush the process
After you have test driven the vehicle, the agent will try and get you to leave with a car. If by any means, you do not like the vehicle or are unsure of it, don’t rush the process. There are many vehicles on the market, and you need to choose one that you like and one that fits your budget.
You do not want to suffer as a result of being persuaded into a purchase you’re unhappy about by a sales agent. Instead, be firm and assertive and let them know you’re not interested.
Taking out a car loan on a vehicle is a big step, both financially and personally.
Whatever you do, do not make a hasty decision that will burden you or stop you from reaching your other personal finance goals. So, make sure you stick to a realistic amount and choose a vehicle that will cater to all your needs without breaking the bank. Best of luck with your car shopping experience!