Personal Finance Garman/Forgue Twelfth Edition Chapter 8: Vehicle and Other Major Purchases PPT slide program prepared by Amy Forgue and Ray Forgue. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Introduction Planned Buying entails thinking through all of the details of purchase from the initial desire to buy to your satisfaction after the purchase. There are seven distinct steps in planned buying. Planned buying makes the most of one’s earnings and puts more money available to save and invest thereby enhancing long-term financial success. It entails thinking through the details of a purchase in seven distinct steps. The more expensive the purchase the more time and effort you will want to spend on each step. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Figure 8-1: The Steps in Planned Buying Figure 8-1 outlines the seven steps in planned buying: 1. Prioritize your wants. 2. Do preshopping research. 3. Fit the purchase into your budget. 4. Comparison shop. 5. Negotiate the deal. 6. Make the decision. 7. Evaluate the decision. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Your Next Five Years In the next five years, you can start achieving financial success by doing the following related to vehicles and other major purchases: 1. Check repair ratings history in the April issue of Consumer Reports magazine when planning to buy vehicles. It is important to get off to a good start in your financial life. The first five years are critical and require that you do five things related to vehicle and other major purchases. First, check repair ratings history in the April issue of Consumer Reports magazine when planning to buy vehicles. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Your Next Five Years 2. Purchase late-model, high-quality used vehicles and obtain a vehicle history report at www.carfax.com and any recall history at www.nhtsa.gov. 3. Obtain price information from at least three sources and aggressively negotiate prices and financing terms for major purchases. Second, purchase late-model, high-quality used vehicles and check their ownership history at www.carfax.com and any recall history at www.nhtsa.gov. Third, obtain price information from at least three sources and aggressively negotiate prices and financing terms for major purchases. Fourth, never tell a seller what payment you can afford. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Your Next Five Years Never tell a seller what payment you can afford. Promptly and firmly seek redress when dissatisfied with purchases or services. Fifth, promptly and firmly seek redress when dissatisfied with purchases or services. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Learning Objective #1 Explain the three steps in the planned buying process that occur prior to interacting with sellers. Learning objective #1 is to explain the three steps in the planned buying process that occur prior to interacting with sellers. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Do Your Homework What do you really want? Needs Wants A need is something that is thought to be a necessity. Wants are unnecessary but desired. In actuality there are few true needs. Most of our purchase decisions involve wants. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Figure 8-2 provides an example of a worksheet for prioritizing your wants. Wants can be prioritized so that we can choose those the provide the best net benefit for the costs involved. 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

How To Buy Smart Do not buy on impulse. Pay cash. Buy at the right time. Do not pay extra for a “name.” Recognize the high price of convenience. Wise buying involves avoiding impulse buying. Paying cash is less expensive than using credit. You should buy at the right time to take advantage of sales and special offers. Wise buying also involves purchasing generic products that provide the same level of satisfaction as name brands at a lower cost. Many people pay too much for items out of convenience when a more planned approach can save dollars. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Become an Expert Preshopping Research: Gathering information before actually beginning to interact with sellers. Wise buyers become experts. They start with preshopping research to gather the information they need before actually interacting with sellers. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Become an Expert What price should you expect to pay? Manufacturer’s Suggested Retail Price (or MSRP): The suggested initial asking price. Dealer Invoice Price: Includes additional charges tacked on by the dealer. www.edmunds.com www.kbb.com www.nadguides.com A key element in preshopping research is to become knowledgeable about price. For big ticket items such as new vehicles the manufacturer will set an initial asking price called the manufacturer’s suggested retail price. Often called the sticker price, it may be accompanied by a dealer sticker price that includes charges added on by the seller. Neither of these prices need be the ultimate price you will pay. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Become an Expert What is my trade-in worth? http://www.kbb.com Should I trade-in or sell my old vehicle myself? Gauge environmental impact It is very common to trade-in a vehicle when buying a new or used vehicle. Wise buyers know the value of their trade-in so they can verify that the offer from the dealer is a fair one. It may be better to sell the vehicle yourself. Note that dealers can offer a very low price for the purchased vehicle and still make money if they offer a low price for your trade-in. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Become an Expert The bottom line? Can I afford it based on: The price? The down payment? The time period for repayment? The trade-in? The interest rate? The cost per use? The bottom line is affordability based on price, down payment, length of a loan, trade-in value and interest rate. Always work down this list starting with price first. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use. 14

Table 8-1 provides an example of fitting a vehicle payment into a budget. Creating such a table when buying any big ticket item will help you see the real impact of the cost on your day-to-day spending. 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Concept Check 8.1 What is planned buying? Distinguish between needs and wants, and explain why it may be better to act as if no needs exist. Assess your understanding by addressing these points. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Concept Check 8.1 Describe the types of information you need to be your own expert when making big-ticket purchases. Summarize the process to determine whether you can afford a particular purchase. Assess your understanding by addressing these points. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Learning Objective #2 Describe the process of comparison shopping. Learning objective #2 is to describe the five aspects of major purchases that require comparison shopping. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Figure 8-1: The Steps in Planned Buying Figure 8-1 outlines the seven steps in planned buying: 1. Prioritize your wants. 2. Do preshopping research. 3. Fit the purchase into your budget. 4. Comparison shop. 5. Negotiate the deal. 6. Make the decision. 7. Evaluate the decision. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Comparison Shopping Use comparison shopping to find the best buy. Compare prices using the Rule of Three. Comparison shopping is the process of comparing products or services to obtain the best buy. A best buy is a product or service that represents acceptable quality at a fair price. When comparison shopping you should always compare at least three alternatives. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Comparison Shopping Compare financing options. What is a fair interest rate? Shop for low rates Obtain a loan preapproval for the lowest rate There are many sources of financing for vehicles and other big ticket items. During your preshopping research you should have lined up your own source of financing. You can obtain a loan preapproval from a bank or credit rate at the lowest rate you can find. Then you can compare that offer with the one’s suggested by the dealer. Sometimes the dealer will have a better deal. Always compare loans using the APR not the monthly payment. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Comparison Shopping Rebate: A partial refund of a purchase price offered as an inducement to buy. Is a rebate available? Should you take a rebate or low-rate financing? New cars today often are advertised as having a rebate or partial refund of the purchase price. This rebate may be an alternative to a special low financing rate. Which is best? The only way to know is to recognize that if you take the low-rate financing instead of the rebate, the lost rebate should be viewed as a cost of financing. You can factor this cost into a recalculation of the low rate financing to compare it to the financing you arranged on your own. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Comparison Shopping Consider leasing instead of buying. Leasing: Renting a product while the ownership title remains with the lease grantor. Many people today lease a new vehicle rather than purchase one. A lease is essentially a long-term rental of the vehicle. You do not actually purchase the vehicle. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Leasing Terminology Gross Capitalized Cost Capitalized Cost Reductions Adjusted Capitalized Cost Residual Value Money Factor The lease payment is calculated by starting with the gross capitalized cost which is the cost to the dealer for the vehicle including financing. From that can be subtracted your trade-in and down payment as capitalized cost reductions to arrive at the adjusted capitalized cost. From that amount you can subtract the value of the vehicle projected at the end of the leas called the residual value. You are responsible for the difference when, when divided by the number of months in the lease, will be the monthly lease payment. The monthly payment you pay for a lease is always going to be lower than the monthly payment on a loan to buy a vehicle. So you cannot compare lease and purchase payments directly. The money factor on the lease is a way to compare one lease offer to another. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Leasing Terminology Open-end lease Closed-end lease (or walkaway lease) Excess mileage charge Leases are either open-end or closed-end. With an open-end lease you might owe more money at the end of the lease period if the vehicle is worth less than the originally estimated residual value. With a closed-end lease you can simply turn the vehicle in at the end of the lease and walk away. Most new vehicle leases to consumers are closed-end leases. However, if you have driven the vehicle more miles than originally agreed in the lease you will pay an excess mileage charge. When taking out a lease always be up-front about how many miles you will likely drive the vehicle per year. Making a lower estimate will save you lease. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Leasing Terminology Additional leasing fees: Acquisition fee Disposition fee Early termination charge Early termination payoff www.leasecompare.com At the end of the lease you may be required to pay a disposition fee to cover costs associated with preparing the vehicle for resale. This fee will be part of the original lease contract and is negotiable at that time. Some people may wish to turn in a leased vehicle early. The leasing company will charge an early termination charge for doing so. This charge plus any lease payments you might still be required to make will add up to the early termination payoff. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use. 26

Compare Warranties Warranties Implied Warranty versus Express Warranties Full Warranty versus Limited Warranties Warranties are an important consideration when buying big ticket items. Warranties are free. Almost all products come with an implied warranty required by law that ensures that the item is of fair and reasonable quality and suitable for sale. The exception is for products sold “as is.” This minimal assurance of an implied warranty can be expanded by a written express warranty. Written warranties are either full warranties or limited warranties. “Full” does not mean that the entire product is covered. You will want to read the warranty to determine the covered components. “Full” means that you will receive free repair or replacement of the covered components. All other express warranties are clearly labeled as limited warranties. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Compare Warranties An extended warranty (or service contract) provides for repair or replacement of covered components for some specified time period. Regular warranties are free. You pay for an extended warranty and they are usually are overpriced! Dealers will often want to sell you an extended warranty that purportedly goes beyond the protection afforded by the basic, free warranty. These contracts are essentially insurance and are highly profitable for dealers. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Concept Check 8.2 What is the goal of comparison shopping? Explain why lease payments for a new vehicle are lower than loan payments for the same vehicle. Describe the relationships among capital cost, capital cost reductions, and residual value in a lease. Assess your understanding by addressing these points. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Concept Check 8.2 Explain the difference between an implied warranty and an express warranty. How do they relate to the term as is? What is an extended warranty? What is a disadvantage of such a contract? Assess your understanding by addressing these points. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Learning Objective #3 Negotiate and decide effectively when making major purchases. Learning objective #3 is to negotiate and decide effectively when making major purchases. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Negotiating Effectively Negotiating (or haggling) Successful negotiators are armed with information. MSRP Invoice Price (or Seller’s Cost) Dealer Holdback (or Dealer Rebate) Negotiating is the process of discussing the actual terms of an agreement with a seller. If you have done your preshopping research and comparison shopping you will be well armed with the information you need to negotiate effectively. Once you have agreed to terms with a seller you will still want to go home and weigh the pros and cons to make your final decision. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Negotiating Effectively Negotiate your price. Play “Good Cop-Bad Cop” Negotiate effectively but decide at home. New-Vehicle Buying Services and Professional Shoppers The first negotiating point is always the actual price of the product. Today you can hire professional shoppers to do this task. Start your price negotiation with the invoice price which is the sellers cost. The seller may not disclose this figure but you should have learned it in your preshopping research. You should also recognize that new car dealers are typically allowed a dealer holdback so the invoice price is not usually the price the dealer actually paid for the vehicle. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Table 8-2 provides an example of a decision-making grid Table 8-2 provides an example of a decision-making grid. Creating such a grid helps you make your decision on an objective basis. 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Negotiating Effectively Negotiate your interest rate only after getting a firm price for the vehicle. Negotiate the lowest possible APR offered through the dealer. Borrow elsewhere if the rate is lower. Once you have a set price for the vehicle you can move on the financing. You want the lowest possible APR. Negotiate with the dealer to bring the APR down and then compare what the dealer is offering with what you have already arranged on your own. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Negotiating Effectively Negotiate your trade-in. Obtain a firm commitment on a trade-in allowance from the dealer. Sell the vehicle yourself if the allowance is too low. Be wary of High-Balling Once you have a price and arranged financing you can more on to the trade-in. You should know what your trade-in is worth from your preshopping research. You really shouldn’t even mention the possibility of a trade-in until this stage. Otherwise you are likely to be a victim of high-balling. This is when the dealer quotes an overly high trade-in allowance early in the process. Then when it comes to finalize the sale the offer will be reduced. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Make the Decision At Home Finalizing a car deal. Be wary of Low-balling. Have the dealer sign the buyer’s order first. Walk away if there is an attempt to change the deal at the very last minute. A similar tactic is low-balling wherein the dealer offers a low price for the vehicle but then, right at the end, states that the price will have to be higher. This can occur after you have signed the buyer’s order—the contract—and the salesperson takes it to the manager for approval. Always have the dealer sign the buyer’s order first. Confidently walk away if there is an attempt to change any aspect of the deal at the last minute. The dealer is bluffing and will likely call you back to make the sale as originally agreed. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Evaluate the Decision Process Many people believe that you can return a vehicle within up to 3 days if you decide it is not for you. This is a myth. Evaluate all major purchases for lessons that can be applied in the future. You should always take time to evaluate the process of buying any vehicle of major purchase. You may not be able to get of the deal but lessons learned can be applied in the future. 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Concept Check 8.3 List some of the complexities in vehicle buying and offer your advice on how to get a best buy. What three aspects of a vehicle purchase should be negotiated? In what order? Assess your understanding by addressing these points. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Concept Check 8.3 Why should you make major purchase decisions at home? Summarize how to use a decision-making grid. Assess your understanding by addressing these points. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Learning Objective #4 Utilize effective complaint procedures. Learning objective #4 is to evaluate your purchase decisions and, if necessary, effectively seek redress. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Use Effective Complaint Procedures The FTC’s Cooling-Off Rule allows you three days to cancel purchases of $25 or more made anywhere other than the dealer’s usual place of business. Redress is the process of righting a wrong. Redress is the process of righting a wrong. When a purchase costing $25 or more can be cancelled only if the purchase was made somewhere other than the dealer’s usual place of business such as in your home. 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Table 8-3: Complaint Procedures Levels to Bring Your Complaint 1. Local business 2. Manufacturer 3. Self-regulatory organizations 4. Consumer action agencies 5. Small-claims or civil court Seeking redress should always start with the local business where the product or service was obtained. From there you can work your way up to the manufacturer of the product. Many sellers belong to self-regulatory agencies such as the Better Business Bureau to which you can make complaints. Consumer action agencies exist to serve consumers who have disputes with businesses. Many are government entities such as a state-level consumer protection agency. As a last resort, you can use the courts to seek a resolution to your problem. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Utilize Effective Complaint Procedures Alternative Dispute Resolution Procedures Mediation Arbitration Lemon Laws http://www.dmv.nebraska.gov/legal/basics.html Small-Claims Court Most vehicle manufacturers participate in an alternative dispute resolution program. In these programs, a neutral third party will review the dispute and make either a recommendation or an actual ruling for resolving the dispute. Mediation is the term used for situations where the neutral third party works with both parties to foster an agreement. The mediator often makes a recommendation for resolving the dispute. Arbitration is the term used for situations where the neutral third party makes a decision resolving the dispute that is binding on one or both of the parties. In most new car lemon laws the ruling is binding on the manufacturer but not the consumer. Consumers can take their case to the courts if they so desire. Small claims courts are often the best option as the service of an attorney are not required. 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use. 46

Concept Check 8.4 Outline the steps to go through to seek redress. Summarize the FTC’s cooling-off rule to cancel a contract. Assess your understanding by addressing these points. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Concept Check 8.4 Distinguish between mediation and arbitration. How do lemon laws work? Assess your understanding by addressing these points. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Worst Financial Blunders in Vehicle and Other Major Purchases Based on others’ financial woes, you will make mistakes in personal finance when you: 1. Tell a seller what you can afford to pay. 2. Rely solely upon the seller, for information on price, financing terms, or trade-in value. Avoid these blunders that are typical for people who are less than successful in their financial planning. Tell a seller what you can afford to pay. Rely solely upon the seller, for information on price, financing terms, or trade-in value. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Worst Financial Blunders in Vehicle and Other Major Purchases 3. Fail to complain when products fail to perform as expected. Avoid these blunders that are typical for people who are less than successful in their financial planning. Fail to complain when products fail to perform as expected. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Do It NOW! You know more about personal finance after reading this chapter, so get started right now by: Setting up a filing system for the warranty information and receipts for all products you own that have a warranty. You do not have to wait to get started on managing vehicle and other major purchases. Get started today by doing these three things. Make a grocery list and buy only what is on the list unless an item is on sale and you will use it. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

Do It NOW! 2. Decide on a big-ticket item you would like to own in the near future and create a decision-making worksheet for it similar to Table 8-2, using your criteria and weights. 3. Keep a monthly budget and fit all payments for big-ticket items into your budget before making an purchase decision. Decide on a big-ticket item you would like to own in the near future and create a decision-making worksheet for it similar to Table 8-2, using your criteria and weights. Setting up a filing system for the warranty information and receipts for all products you own that have a warranty. 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

What Do You Recommend Now? Now that you have read this chapter on vehicle and other major purchases, what would you recommend to David and Lisa Cosgrove regarding: 1. How to search for two vehicles to replace those destroyed? You were asked at the beginning of the chapter to provide recommendations in personal financial planning. How would you answer these questions now that you have read the chapter? How to search for two vehicles to replace those destroyed? 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.

2012 Cengage Learning. All Rights Reserved 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or on a password-protected website for classroom use.