Spend

The No. 1 step to take before buying a car

Rusakova Darina | Twenty20

Before walking into a dealership to buy a car, you want to be certain of one thing: exactly what type of car you want — and ideally, the specific model.

The reason it's important to know what you want is because if you show indecisiveness, "you're at the mercy of the salesperson," says former car salesman David Weliver, who now runs personal finance website Money Under 30. If the sales rep is good at their job, they'll play off your emotions and steer you towards something that's more profitable for them and more expensive for you.

"You don't want to get in a situation where they can use your eagerness, excitement or urgency to get a car against you," he says. After all, one of the biggest mistakes first-time car buyers make is overspending.

To figure out what type of car is right for you and your lifestyle, think about your priorities: Will you be carpooling? Do you have a long commute? What are your must-have features? Is trunk space necessary? What about a back-up camera?

You can use tools like Edmunds.com and Kelley Blue Book to research different cars, read reviews and compare models side-by-side.

You don't want to get in a situation where they can use your eagerness, excitement or urgency to get a car against you.
David Weliver
founder of Money Under 30

You also want to settle on something within your budget. Keep in mind that, almost always, a car will end up costing you more than the sticker price. You want to factor in all of the expenses that come with actually owning a vehicle, including gas, insurance, maintenance and repairs.

If you don't pick a car within your budget ahead of time, by the time you start test-driving, it'll be easier to convince yourself to buy more than you can afford.

"Know your number first so you don't overspend later," says Weliver.

Don't miss: Former car salesman: Never say this 1 thing when negotiating a deal

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Rusakova Darina | Twenty20
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