Your new car-buying checklist

The first of the new ‘63’ registration plates will roll out of the forecourts today (September 1) and figures from the Society of Motor Manufacturers (SMMT) forecast new car sales will reach 2.2million by the end of the year – up 8.4% on 2012. So if you’re one of the lucky ones looking to snap up a brand new motor, our checklist will make sure you get a good deal on your new car, as well as those expensive add-ons that come as part of the package.

What will I be using the car for?

The first thing you need to look at is what you will need from your new car and then check out which models fit the bill – there’s no use splashing out on a two-seater cabriolet if you’ve got a couple of kids and a dog to ferry around. So think about all the things you’ll be using the car for and then look at running costs, factoring in things like fuel consumption, vehicle excise duty (VED – better known as road tax) and insurance, and other details such as boot capacity, number of seats and any extras such as sat navs and cup holders (that’s not a joke, a lack of cup holders is a tick in the ‘against’ column for me!).

Where will I be driving?

The type of roads you will be using should also be taken into consideration when choosing a new car. As a general rule of thumb, if you cover a lot of motorway miles then go for a fuel efficient diesel, if you’re driving around town then a petrol or hybrid could be your best bet, and if you will only be using your car for school or shopping runs then you may even get away with an electric vehicle.

What are the running costs?

Once you’ve worked out what you need the car for and where you’ll be doing most of your driving, you can drill down into the running costs, most notably the price of fuel and insurance premiums. The accepted wisdom has always been that diesel cars are the most cost-effective when it comes to fuel economy. However, the higher cost of diesel and the manufacture of more fuel efficient petrol engines mean this is no longer the case and cars of both fuel types can now hit around the 70mpg mark. Also bear in mind that the models with the best fuel economy are usually the most expensive, so do your sums and work out whether the extra outlay will be clawed back by savings at the pump. When it comes to insurance, the type of car you drive has a huge impact on premium price as insurers place each car into one of 50 groups based upon things like engine size, value, repair costs, security and theft risk. The higher the grouping, the more expensive the premium. So once you have a vehicle in mind, run a quote on MoneySuperMarket’s insurance channel to get the best price on your annual premium – our latest figures show 40% of customers could save up to £311.85 on the cost of cover. Finally there’s the VED, which is based upon CO2 emissions – each car is banded from A to M, and while those in band A cost nothing to tax, a car in band M can cost as much as £475 to tax. And then there’s the special first-registration tax, which will be tacked onto the ‘on-the-road’ price and is generally higher than the cost of the subsequent years’ VED. Once you’ve worked all that out, you can set yourself a budget, so…

What’s my budget?

Buying a new car generally requires a big initial outlay – even if you’re paying for the car in monthly instalments there’s a good chance you’ll have to stump up a sizeable deposit as part of any finance deal. And although you may be tempted to squeeze your budget just a little further to get a model with a better trim or more powerful engine, bear in mind that this initial outlay is only the beginning and choosing a higher specification can have an impact on running costs; adding to how much you’ll pay for insurance, tax, fuel and servicing costs. Furthermore, upgrading to a vehicle with larger alloys and sports suspension can also raise the car’s emissions, which will push it into a higher tax band and increase your running costs. So factor in all of these costs, set yourself a budget and make sure you stick to it.

What can I get for my old car?

If it’s a case of ‘out with the old and in with the new’, the temptation may be to just part exchange your old vehicle, but this probably won’t get you the best price. So consider all the options, including selling privately or to an online car buying company and then work out which is the best option for you. For a more detailed look at selling a car, check out my article How to get the best price for your car.

What extras can I get?

The way in which cars are sold is changing; whereby dealers would once ‘nip out back to speak to the manager’ before knocking some money off the screen price, they’re now more likely to lump in offers of free insurance or even free fuel – so negotiate and see what you can get out of them. If you do get free insurance, make sure you shop around for cover upon renewal and don’t auto-renew as you’ll end up paying through the nose. For more on the importance of shopping around, and the best time to start running quotes, read my article Car insurance renewal due? Here’s how to save!

How should I pay?

You’ve chosen your car, squeezed the salesmen for as many extras as he could muster and now comes the hard part, paying for the thing! If you’ve got the cash to pay for your car then go right ahead, but if you’re going to have to take out some sort of finance make sure you weigh up all the options, from credit cards to personal loans (rates are at an all-time low), to dealership finance or even leasing. For a detailed rundown of leasing options, read Rachel’s article All you need to know about car leasing and for other payment options read this article

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