NEWS RELEASE

Media Contact:
Renee Beauregard 303-400-3456
Ken Scott 713-682-1382, pager 1(800) 901-4418

CONSUMERS UNITED ASSOCIATION HELPS ACCELERATE YOUR CAR BUYING SMARTS

By Renée Beauregard, Executive Director, Consumers United Association

Are you in the market for a new set of wheels? Before you zoom off to the dealership and browse the acres of cars on the lot, do a little prep-work first. By spending more time doing some research in advance and becoming pre-qualified for your loan, you can get the car you want and potentially save hundreds or thousands of dollars.

It’s no surprise to many of us that the price of a new car is certainly a bigger investment today compared to 20 years ago. But what’s interesting to consider when you’re buying a new vehicle is to determine how many weeks of actual income it would take to own a new car. It’s a sobering fact to face but definitely gives a realistic perspective of the purchase. An auto affordability index by Comerica Bank recently reported that 23.6 weeks of income for a medium family generating $58,000 annually would cover the cost of a new car.

Make every effort to leave no stone unturned before you sign on the dotted line for your next car. Online resources such as Cars.com are a smart research tool for savvy car shoppers. Navigating through the decision making process, Cars.com features an online interactive interface called “Total Cost of Ownership” which determines how much a new car will cost over five years and shows a snapshot of the vehicle based on MSRP, depreciation, taxes, financing charges, insurance, fuel costs and more. Consumer Reports is also an excellent tool for learning about owner satisfaction, reliability, vehicle safety ratings and provides a way to compare competitive models.

Now ask yourself the following questions before grabbing that new set of car keys. What size of vehicle do you need?; What kind of horsepower and fuel economy suits you?; Do you want a new or used car?; What type of vehicle is of interest to you such as a luxury, SUV, pick-up, van, or sports car?; and finally, How much can you spend on your next car purchase?

Once you clarify those answers, think over what kind of features you will want on your next vehicle. In today’s competitive marketplace, automobile companies are developing and offering some incredible features to lure in car buyers and help the automaker gain a foothold within the industry. Some of the latest and most popular features available include: DVDs, GPS, OnStar, Bluetooth, Sirius Satellite TV, backup sensors, push-button start ignition, around view monitor, blind spot detector and automatic parallel parking. Plus, forecasted for the future, vehicles can also be equipped with features such as: alcohol-detection system; speed limit detection system; capless fuel filter, and seamless iPod integration, to name a few.

Accelerate your car buying smarts and be alert to things like: cash back incentives, zero percent financing, bumper-to-bumper warranty, leasing verses buying, and the benefits of a Hybrid or alternative-fuel vehicle which is often eligible for tax credits up to $4,000. You should also consider your preference regarding a 2-door or 4-door vehicle; whether the engine is four-cylinder, V-6, or V-8; if you like manual or automatic transmission; antilock brakes; two or all-wheel-drive; and trim levels such as leather or cloth interior. Thinking in advance before shopping can save you time but more importantly money in regards to matching the car to your exact budget and honest needs.

Before you start your engine, don’t forget about car insurance which is commonly not a huge deal-breaker when choosing a new car. Although the Insurance Information Institute estimates that the average cost of car insurance will rise only .5% this year and that it will decline by the same amount next year which is noteworthy since insurance prices haven’t dropped since 1999.Contributing to these lower rates is the decline in accident rates and the development of safer cars. Of course, insurance rates vary widely depending on the type of coverage but the overall trends look promising.

Once you have decided on a few models you prefer, call your auto insurance agent to obtain rate quotes on your choices. You may be surprised to learn that insurance on some vehicles is much higher than others, which can impact your decision.

Again, before actually shopping for your vehicle, consider becoming pre-qualified for your auto loan. Doing so will help you stay within your financial limits and will help you avoid costly upgrades that you could have lived without. Always keep in mind the total price of the car over the “affordable monthly payments” to help keep you from overspending and paying too long on your new car.

Investigate loan rates in advance. For example, did you know that credit union members in Colorado who finance a $25,000 new automobile for 60 months will save an average of $239 per year in interest expense compared to what they would pay at a banking institution in the state according to an analysis by the Credit Union National Association?

So, consider all of your options before driving off into the sunset. There are many valuable resources to help you make a solid financial decision such as reports and rankings put out by Consumer Reports, and J.D. Power. Striving to accelerate your car buying smarts will make all the difference in your final purchase.

Dedicated to educating consumers on financial issues such as buying a new car, Consumers United Association (CUA), a nonprofit consumer advocacy association that serves consumers in Colorado, aids consumers in the resolution of consumer problems and provides a united voice for consumers in the legislative arena. Membership to CUA is open to Colorado residents who are interested in financial education and advocacy and is only $5 annually and $25 for a lifetime.
For more information visit: www.cuacolorado.org.