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Source www.AAA.com December 2011

Personal Finance Objective 6.02-B Students will understand options and practices for meeting transportation needs. 6.02-B “Choosing the Right Vehicle”. Source www.AAA.com December 2011 . Factors to Consider Before Purchasing. Determine what is affordable for you

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Source www.AAA.com December 2011

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  1. Personal Finance Objective 6.02-BStudents will understand options and practices for meeting transportation needs. 6.02-B “Choosing the Right Vehicle” Source www.AAA.com December 2011

  2. Factors to Consider Before Purchasing • Determine what is affordable for you • Evaluate your driving habits • List needed features • Consider vehicle depreciation costs • Will you buy New or “new to you”?

  3. What Can You Afford? • Value of your trade-in • Amount of down payment • Budget $ available for • Monthly installment payments or • Monthly lease installment • Lump sum payment for vehicle • Investment financing options • Insurance costs

  4. Evaluate Your Driving Habits • How will vehicle be used? • What types of trips will be most frequent? • Local Short distance…will Electric car work? • How many passengers will vehicle need to carry? • How much cargo space is needed? • Need trunk to lock • Open storage (pickup truck) • Will vehicle be mostly on 4 lane highways? • Weather/geographic conditions? snow, mountains, gravel/muddy roads • Where will you park at home/work?

  5. List of Needed Features • Needed or Wanted? • Seating • Cargo space • Fuel economy • Commute –Electric- MPG • Style: 2 door, 4 door, 2WD, 4WD, sedan, truck, SUV • Safety features • Specialty or convenience: GPS, CD player, DVD player, Sirius radio

  6. Consider Depreciation Costs • Biggest yearly expense for new cars is DEPRECIATION • Consider a model that has a track record of holding its value for longer • Research how much models depreciate within the first 5 years

  7. New or “New to You”? • Will you buy NEW or NEW to YOU vehicles? • Both have Benefits & Detriments • Consumer must weigh options and related costs to make best decision. • New Vehicle • Higher pricing • Possible purchase incentives-rebates, gas for year bonuses, etc. • Longer & broader warranties • Wider variety of units available • More variety in features • Can order “custom” from factory

  8. New or “New to You”? • Will you buy NEW or NEW to YOU vehicles? • Both have Benefits & Detriments • Consumer must weigh options and related costs to make best decision. • New to You • Lower pricing • Less buying incentives • Warranties more limited • Harder to find desired vehicle & features • Less choices widely available • Search longer to find desired vehicle • More maintenance due to age & prior usage • Get inspection to ensure quality and performance

  9. WARRANTIES & MAINTENANCE • Review Warranty • Length • Coverage • Limitations • Investigate maintenance costs • Check with an auto repair shop ( a reputable or trusted mechanic) for estimated costs of • Fluids-oil changes, etc. • Parts-tires, batteries, etc. • Other repair items • Overall value of vehicle • Check out major components-engine, 4WD

  10. INVESTIGATE SAFETY RATINGS • Check with National Highway Traffic Safety Administration (NHTSA) • www.SafeCar.gov • Insurance Institute for Highway Safety (IIHS) • www.IIHS.org/Ratings • # of airbags • Vehicle “roll” factor • If using car seat, chek out access to vehicle’s LATCH system

  11. SEEK RECOMMENDATIONS • Recommendations • Ask friends • Ask family • Ask colleagues • Ask your mechanic • Reviews • Check webwsites for expert opinions or reviews • www.AAA.com/autosales • www.AAA.com/Go , click “On New Cars”

  12. DON’T LIMIT CHOICES • Don’t get stuck on one vehicle that you can’t live without! • Be flexible to get more negotiating room with seller • Check out vehicles that meet your needs

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