4 Tips to Get the Best Deal When Buying a New Car

The process of buying a new car can be a mix of excitement and stress. It's fun to check out cars you like and take them for test drives, but the part where you actually negotiate the price can be a hassle. You don't want to breeze through the car-buying process, though, because when you're smart about it, you can save thousands of dollars. Here are a few tips that will help you get the best deal when you buy your next car.

1. Figure Out the Value of the Car You Want

Knowledge is power, and that's especially true when you're buying a car. Once you have a car in mind, you should look up its value, as this will give you a starting point for negotiations with the dealer.

One of the more popular tools for calculating the value of a car, new or used, is the Edmunds True Market Value database. All you need to do is plug in a car's details, and you'll see what its value is in your area. With new cars, the tool also shows you the car's invoice price, which is what the dealer pays for it. This way, you're able to negotiate up from that invoice price instead of down from the much higher suggested retail price.

2. Don't Buy the Extras

When you're finalizing a car deal, the dealer will likely offer you all sorts of expensive extras. Typical extras include rust-proofing, paint protection and vehicle identification number (VIN) etching.

These are big money makers for the dealership, and you should always decline them. Some of the services are entirely unnecessary. Others are useful, but available much cheaper when you go elsewhere for them.

This is also true with extended warranties. Despite their popularity, extended warranties typically aren't worth the money. It's better to save the money you would have spent on the warranty and save it for maintenance yourself.

3. Take All a Car's Expenses into Consideration

The price you pay for the car now shouldn't be your only consideration. If you have multiple cars in mind, you should also think about how much each car will cost you over the long haul.

For example, one car could be cheaper than another, but also less reliable. Even though you're spending less upfront for it, you'll likely spend more in repair costs. You can check reliability reports to see what a car's expected repair costs are.

Insurance is another important factor, especially since you'll be paying it every month. If you can get cheap auto insurance with one car, that's a huge selling point, even if the car itself is a bit more expensive.

4. Consider an Auto Broker

If you're not a fan of the car-buying process, you may be better off using an auto broker for your next car purchase. With an auto broker, you tell the broker what kind of car you want, and then they find and negotiate deals for you. Auto brokers typically charge a flat fee, with the amount depending on the broker and how rare the car is that you want.

Even though you're paying a fee to the auto broker, you can still end up saving money by doing this. Many auto brokers worked at dealerships before switching careers, which means they know how to negotiate with dealers to get the lowest prices. If you pay $200 to a broker who saves you $1,000 on what you would have paid for a car, you're still coming out ahead. And you won't need to spend as much of your time looking for a car.

Car buying is one area where knowing what you're doing can help you save quite a bit of money. Take your time during the process and keep the tips above in mind to spend less.