At the request of one of our readers, we created a Ask the Wealthy Bloggers post, soliciting questions that we could set about answering, hopefully with our readers adding their two cents in the comments. Today I thought I would tackle the first of the questions we received:

What’s your advice for students looking for new(er) cars? Tastes change, I don’t think I want to try to re-sell a car in a year or two. Plus, is there a good way to go about looking? Online? Offline? Financing? etc.

Before we even got around to answering, Tommy Chang had a response in the pipe:

Well I’m not one of the “Wealthy Bloggers” but I love cars so here’s my advice.

A new(er) car for the student? Concentrate on your education, plenty of time later to get a nice car. That said, if you must…

Read my blog on this topic - http://www.tommychang.net/2005/06/new-car-buying-guide.htm

Figure what you type of car you want. Then research the car by reading reviews on it, reading owner/enthusiast forums and configuring your car on the manufacturer website. Find out the invoice price of the car. Research insurance costs as well before. Finally, I recommend that you shop for your own financing via local banks and credit unions. They usually will offer a better rate than the dealer. If you have an old car, I recommend selling it yourself instead of trading it in.

If you’re interested in a new car, negotiate from $500 to $1000 below invoice. Everything is negotiable.

If you’re interested in an used car, find out its trade-in value or market value in poor condition from the Kelly Blue Book and use that as your starting point for negotiations.

You should also run a CarFax report, take it to your mechanic for a full inspection, ask for all service records. Avoid CarMax like the plague, unless you plan to sell them your car but do not buy from them.

For a student, I would recommend a Honda Civic, the upcoming 06 Honda Fit or a Scion. Decent looks, inexpensive but good build quality, high MPG rating. Good luck!

Good advice, but there is one thing I would like to add emphasis to: students should think twice about looking for new(er) cars. Your post-secondary years are unpredictable, everyone enters school with a dream of graduating and landing a great job, and they often spend accordingly. The reality is that not everyone will graduate, and those who do rarely land dream jobs fresh out of school.

When you do finally graduate, odds are you will find yourself stuck with sizable student loans, and adding the cost of financing a new(er) car won’t do much to help the situation. If you don’t graduate, you still will have students loans and new car financing to pay for, but without the piece of paper to help you get a job to pay for it all.

In other words, I would advise against buying a new(er) car as a student. When I went through school I did it with a combination of public transportation and a 1986 Honda Civic. It did not look like much, but it was clean, reliable, and good on gas. The fact that it cost $600 in a private sale and never needed more than $1000 in maintenance in the 4 years I owned it didn’t hurt either).

I would say look in the mid-90’s range for a good mileage car known for reliability, and a Civic is never a bad idea for a student. Other than that check out the link Tommy provided, he has some great advice in it. You can always look at sites such as eBay Motors, and MegaWheels.com (in Canada).

Have some advice of your own? Please post it in the comments.

This entry was posted on Wednesday, July 6th, 2005 and is filed under Automotive. You can follow any responses to this entry through the RSS 2.0 feed. Responses are currently closed, but you can trackback from your own site.