How to save money when buying a car

When it comes to a major purchase like a car, you probably want to save as much money as possible. Unfortunately, getting deals on car purchases isn’t that easy these days.

Although the rise in new car prices has slowed since they skyrocketed during the pandemic, “the average cost of a new car remains historically high,” said Nerdwallet. “At the end of 2025, the average transaction price reached an all-time high of $50,326, according to Kelley Blue Book – and despite the recent slowdown, prices have not strayed far from that peak.” And unfortunately, used cars haven’t been so easy on the wallet lately, especially given rising financing and car insurance costs.

But for many, a set of wheels is a necessity. If you’re in the market, here are some ways you can try to cut costs.

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1. Do your research

It’s important to do your homework before walking into a dealership. Familiarize yourself with the car models in the class you are interested in and find out which factors such as performance, reliability and value are well rated. Find out what a fair price is for this vehicle by “using online price guides like Kelley Blue Book, Edmunds or NADA Guide to know what price you should pay,” Nerdwallet said.

2. Get pre-approved

Financial preparation is equally important. “Before you start visiting dealers, get a pre-approved financing offer,” as this will ensure that the “dealer will have to make a better offer if they want to win your business for this part of the transaction,” says U.S. News & World Report. Be sure to also shop around before committing to a single car loan lender offer to make sure you’re getting the best rate.

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3. Look for incentives

“Check dealer and manufacturer websites for local and national incentives such as cash back offers, low-interest or even 0 percent financing, and leases with low monthly payments,” Consumer Reports says. It’s not uncommon to find these types of offerings “among less popular offerings — like sedans, small hatchbacks, and front-wheel-drive (as opposed to all-wheel-drive) SUVs,” according to the outlet. Certain seasons are also better than others if you are looking for a good deal on a car purchase.

4. Brush up on your negotiation tactics

Whether you’re working with a car dealer or a private seller, it never hurts to ask for a better deal. A “good negotiating tip is to focus on the total price of the car,” TaxAct said. “Sometimes a salesperson will try to estimate how much of a monthly payment you can afford rather than your overall budget, which can result in you spending more money than you expected,” especially when the cost of car ownership is taken into account.

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However, the trump card in a negotiation is being comfortable walking away. “Just showing a willingness to get up and go is often a powerful message to alert dealership staff and give you a better deal,” said US News & World Report.

5. Stay flexible

Keeping an open mind about what car you buy and what features it has can go a long way toward getting a better price. “For example, take note of which brands have more or fewer cars in stock,” as those with more inventory are usually more willing to negotiate, said Kiplinger (a sister site of The Week). Also take into account the different features that a vehicle offers and which functions seem necessary to you and which you can do without. If you feel like you need certain add-ons but the price doesn’t fit your budget, “consider downsizing or purchasing models that aren’t as popular,” according to Consumer Reports.

https://theweek.com/personal-finance/save-money-car-purchase