TIP 4: Leave your trade-in at home
When you’re buying a new car, always leave your trade-in at home. New car dealers love to confuse buyers and obfuscate the deal’s economics with trade-ins. Sometimes they offer what appears to be a high trade-in price but refuse to discount the new car you’re buying – with a better financial result for them than had you just bought the car with no trade-in and simply driven a hard bargain. Coming to grips with whether you’re getting a good deal on a new car, or not, slips further from your grasp whenever a new car dealer starts cooking the books with your trade-in.
You should also realize that new car dealers invariably offer you less for a trade-in than you could achieve for yourself by selling your old car in a private sale. Trade-ins are exclusively about convenience, not value – they allow a ‘one-stop shop’ where you get rid of your old car with minimal fuss, in the process of (and at the same time as) acquiring a new car.
So, if you’re buying a new car, leave your trade-in out of the deal. Just figure out how much (hopefully how little) your new car will cost, and sell your old car privately.
For a professional guide on trade-in values and private-sale values visit redbook.com.au.