So lets start here. Do you know how to buy a car?

It's taken me years, I still make a few mistakes, but in the last 20 years, I have done rather well. I keep seeing people giving advice about buying a car, and they are almost always wrong. They may makie you may feel like you are some sort of world class negotiater, but you are probably still getting ripped-off.

What's the most important part of buying a car?

The most important single decision you will make is to determine what to buy. That sounds so elementary, especially since most people see themselves as Ford persons, sporty drivers, or truck persons. In other words, most people wear their cars as extensions of the personality which they really wish other people would believe that they really are. Peer pressure plays an enormous part, for example, not many teenagers would be happy owning a Buick. In fact, even though Buicks are probably the best built cars made in this country, I see them as old fart cars, and I'm 66 myself.

So does that mean you should buy something you hate or would be embarrassed to drive. No, not at all, it's just when you go buy that huge, gas-guzzling truck and then use it as a car, you will be paying a lot more in gas, maintenance, and depreciation, and you will reap the scorn of people like me who call your truck a pussy truck, because you would be driving a car instead if you weren't such a pussy. On the other hand, a Corvette, a Prius, or some classic old car is something that can be appreciated by the owner and his social group. Each person has to weigh for themselves the benefits of economy versus affection they may have for the car they are going to buy. It should not be a trivial decision. You should observe the cars around you and see if you can determine which cars people seem to enjoy driving and owning. Then, if you follow the senior golf circuit, go buy a Buick. If you really don't need a truck for anything but your wilted ego, then go buy the meanest, most macho truck you can throw your money at.

Should you buy new or used?

That depends. On what you say? I have successfully bought new cars and used cars from both dealers and individuals. Here are some reasons for buying a new car.

1. What you want is not availble used. For example, in 1994, I bought a Dodge Caravan, mini van new. That was the first year they put in dual airbags and I wanted them. Also, I wanted a stick shift version of that mini van which was a hard item to find. So there was little choice.

2. You can pay more for a used car. When I buy a new car, I can decide exactly what options I want, and in many cases, what options I do not want to pay for. Thus, when I bought a 2001 Dodge Caravan to replace the 1994 which had expired, I paid $16,000 for a brand new one. I could have paid about that much for a used one with 40,000 miles and options I did not want from one of those mega mart used car lots whose slogan I think should be, "Used cars for the price of new." I would have rather had a used Honda van, but they were going for over 20,000 used.

Here are some reasons for buying a used car.

1. You need to pay a little as possible for driving and owning a car. This is obvious.

2. You don't drive much. Then don't waste your money on a new car. If you drive less than 10,000 miles a year you should consider a used car. If you drive less than 5,000 miles, you should buy a used car. A 4 year old car with 50,000 miles will sell for about one half the price of a new car. If nothing is wrong with it, it should easily last for another 50,000 miles which means you get 5 to 10 years of use.

3. You couldn't afford that car new. You always wanted a BMW, or a Lexus or a Mercedes-Benz, but you don't have the $40,000 to $60,000. I came so close to buying a 1999 Mercedes-Benz 230 Kompressor, but the car I had was perfectly good, and when I read the reviews of the Mercedes I realized that it could be very costly to maintain. Unless you can afford to buy one of these cars new, you better be very careful buying one used. I've known people who suffered through the worst possible nightmares of used Audi's, Land Rovers, and Jaguars. I suffered through a 1977 BMW 530i.

Should you buy from a dealer or an individual?

Well, that depends. Ideally, I like to buy from an individual. They are generally more honest and you can get a better idea of the condition of the car. I hate "prepped" cars. I want to see real dirt so I can tell if anything is leaking. I really like buying a car from someone I know, but I admit selling cars which I would not want to sell to a friend.

What about a trade-in?

That means you will probably have to buy either a new or used car from a dealer. If buying from and individual is my first choice, then buying a used car from a dealer is my last choice. The price is going to be higher and there is sales tax to pay, but if you want to trade something, then you will have to go to the dealer. In then next section, I discuss what to do about negotiating with a trade-in.

How to negotiate

So how do you get the best deal? There are several very important factors here that you never see in "how to buy a car" info.

1. It is always best if you can take or leave the car. How badly do you really want that particular car. Personally, I have ranged from pouncing on the sellers price, paying too much, or even failing to buy the car because the seller wanted too much. If a good friend offers you a good deal on a car you want, that is not the time to practice your haggling skills. On the other hand, there are usually many, many new cars which are almost exactly the same, and you even have a selection of dealers. I bought that 1994 Dodge above from the third dealer I shopped after fruitlessly haggling with the first two. Even though it was a rare car (a stick shift mini van), any dealer can find any car that is in another dealers list of cars and sell it to you.

2. Walking away is your only weapon. Unless you are sexy, charismatic or possess a very threatening presence, all you have to negotiate with is the fact that the seller wants to make the sale, and you want to pay less.

3. And now the greatest rule of negotiating, bar none! It sounds a little like Yogi Berra, but it's the truth and the bottom line, "It ain't a deal until it's a deal!" So when those how-to-buy-a-car advisors tell you to get the price for the new car before mentioning a your trade-in, they are violating the greatest rule of negotiating. Until everything, and I mean everything is covered in the deal, it ain't a deal. I wasted two hours with a dealer who gave me a very good price, but then tried to low ball me on my trade. It ain't a deal until it's a deal!. You go to the dealer and say, this is what I want to buy, this is what I want to trade, and this is what I will pay. Do your research and be ready to walk out.

No, the dealer is not about to loose money on any deal, but they have hundreds of gimicks to make you pay more. Here's an example, the salesman hands you a piece of paper with his response to your offer. It looks good, but why is it on a piece of paper instead of his invoice? Because you don't have a deal, that's why! The invoice has a $500 charge for some sort of baloney, maybe an accounting fee or a processing fee, but it's just extra profit, that's all. However, if you go in, knowing that the $500 is on the invoice, then you you know that the dealer can sell you the car at a lower price and still make money.

The best deal I ever made was to simply tell the salesman, "I'll write you a check right now for this amount." He went away and talked someone, came back and said he wanted another $200. I said fine, and that way, since I told him what the amount on the check would be, he could have all the junk fees he wanted on his invoice, but all he was going to get was my very low offer plus $200.