1. Personal Finance Autos and You

2. So You Want a Car, Huh?

3. $249 Well, hey, only $249 a month! I can afford that!

4. Discussion Questions What costs are associated with owning and operating a car?

5. Costs of owning a car FIXED Initial purchase price Registration and title costs Sales tax Financing costs Depreciation Insurance Scheduled maintenance Storage (renting garage space)

6. Costs of operating a car VARIABLE Unscheduled repairs and maintenance Gasoline Oil and other fluids Parking and tolls Tickets

7. How Much Can You Afford? The 10% rule –spend no more than 10% of your take home (net) pay on a car payment If you make $2000 a month, try to find a car payment of $200 at the most Work with a budget

8. Before Buying a Car Narrow your choices Research and compare Credit Pre-approval Visit Dealers Test/Inspect

9. Price Bargaining Schemes

10. Discussion Questions Whats better NEW or USED? Compare the Advantages and Disadvantages of New/Used Cars –Come up with 3 Pros and 3 Cons for each

11. ANALYZE: NEW and USED Cars NEW CARS USED CARS PROSCONSPROSCONS

12. Places to Buy a Car From a dealer From a private party From an auction Others? –Internet? –Using the internet as a research tool

13. A used car from a dealer Consider costs, reliability, dealer reputation Read the "Buyer's Guide" sticker Consider the warranty and the service contract What to do if you have problems?

14. A used car from a private party No warranty Cost less than from a dealer Make sure you get the TITLE. A TITLE proves ownership of the car

15. 5 Tips When Looking at Used Cars Check Body Condition Check Odometer Consider Mileage Get a Mechanic to Check the Car Get Registration and Title before you buy

16. Electrical Shock Absorbers Tires Brake Shoes and Lining Suspension Arm Steering Wheel Exhaust Pipe Engine Radiator Lights IDENTIYFING PROBLEM AREAS IN USED CARS Muffler

17. THINK: What should a test drive include? Drive on bumpy roads, freeways, etc Run in all gears Test brakes Start the car several times Listen for strange noises Park the car on a clean surface and check for drips Check lights, windows, radio,heater, A/C, etc.

18. A new car Read about new car features and prices Shop around Plan to negotiate price Learn the terms Consider the service contract

19. Types of warranties As-is warranty Implied warranty Dealer warranty Manufacturer's warranty

20. Service contracts Preventing problems Resolving disputes Comparing promises of warranties and service contracts

21. AUTO INSURANCE Why do you need it? –Required by Law –Good Idea in case you get in a wreck

22. How are insurance rates set? Age Sex Marital status Personal habits (e.g., smoking) Type of use Frequency of use Location Driving record deductible Type of car Value and age of car Type of coverage Type of car Grades

23. DEDUCTIBLES Usually either $500 or $250 Deductible –The amount you pay after a Claim is filed –example: You back into a tree and do $650 in damages. Your deductible is $250, then the insurance company pays you $400 Your deductible is $500, then the insurance company pays you $150

24. DEDUCTIBLES (cont) So why would you ever want a $500 deductible? Accident free discounts –You may not even want to file a claim. –Keeps insurance rates down.

25. Types of coverage Bodily injury liability Property damage liability Collision Comprehensive Medical payments Uninsured motorist Rental reimbursement Towing and labor

26. WHAT IS THE CAR WORTH? New Cars –MSRP Sticker Price / Retail Price –INVOICE PRICE The Price the Dealer Pays –Your goal? To get as close to the invoice price as you can!

27. Dealer Tricks Highballing Lowballing Talk to the Manager Bait and Switch The Waiting Game Good Guy / Bad Guy