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How to buy a car

July 19, 2009 · 6 comments

I’ve recently been emailed and asked about how to negotiate for a used car, since I’ve done a reasonable amount of car-buying in my life.  I was writing an email in reply, when I decided to turn it into a blog post instead, since the tips could also be of help to others who might be interested in buying cars.

I prefer buying cars from dealers because it’s easier to negotiate hard with them. They’re salespeople, and negotiating is what they do.  At the end of the day, the dealer just wants to move stock, whereas private sellers often have emotional interests in the sale of their cars and how much they want for it.  Unless it’s an ‘urgent sale’, the private seller will quite happily wait for someone to come along and give them the money they want.  Negotiating with a private seller is not as easy as it is with car dealers.

Used car dealers sell stock that has been traded in on other cars.  They sell the cars that someone else has no longer wanted.  They’ve usually got the car extremely cheaply, and added their margins onto it in order to make their profit, and it means there is often a considerable amount of ‘room to move’ (eg. that margin means considerable discounts if you can negotiate for them).  They also want to try and get rid of that car as fast as they can, to make room for more cars that come in as trade-ins or cheap purchases elsewhere (eg. auctions, etc.).

Here’s what to do if you want to buy a used car from a dealer:

Take it for a test drive to find out if you really want it. That’s step #1.  If you don’t like ANYTHING about it, move on.  You have to LOVE the car before you actually spend money on it.  Of course, if you’re only spending $500 – $5,000 then ‘love’ doesn’t really play a part in it.  You’re likely buying it because you need it, and anything will do!  If you’re spending more than $5,000 though, then you really have to start liking what you’re buying.  The more money you’re willing to spend, the more emotional interest you are going to have in the car.

Understand what you’re buying the car for. Is it for transporting a family, or going out bush, or just casual driving around town, or maybe you want a sports car?  Knowing what you really want in a car, and why, is essential to finding the right car for you.  Only test drive the cars that will satisfy your needs.

Make sure there’s a recent mechanical inspection report. If not, ask if you can have one done for you. A reputable dealer will either have one available, or will get one done for you. If they don’t want to do this, walk away.  If the report shows repairs are needed or concerns are raised, walk away.If anything about the dealer or the cars is suspicious to you, walk away.  Try a different dealer. There’s a lot of dodgy car dealers out there, but there’s a lot of good ones too.  Avoid the ones that leave you suspicious, and seek out the ones that actually make you feel important.  To a reputable dealer, you ARE important.  Your happiness is important to their business.  If a dealer cares more about your money than they care about you, then avoid doing business with them.

If you can, have a car you can trade in. It can increase your negotiation power.  I once bought a car for $500 to drive around in until I got my ‘real’ car (a month later).  When it came time to talk about trade-ins, they asked me how much I wanted for mine.  I said $3,000.  They laughed and said it’s only worth $1,000.  I said “I know, but $3,000 is what I want.” They stopped laughing, and negotiated me down to $2,500 and went halves with me on insurance.

You don’t always need a car to trade in.  I helped a friend buy a used car, and she only had $10,000 to spend. We went test driving.  She liked a car that was reduced to $13,000 from $14,000 so I went to the salesman and said, “Ok, she likes the car and she’d be happy to take it for $10,000.” They laughed and said it’s already discounted as far as they can.  (Salesmen laugh a lot during negotations. Think nothing of it, they’re just trying to discourage you from succeeding with your negotiations.)  I said “Sure, but if you want to sell the car, we’ll take it for $10,000 today, cash.  Here’s my number – give me a call when you’ve made your decision. We will definitely take it for $10,000 and pay you today.” Then we walked away.  Half an hour later they called and said we can have it for that price.

Work out exactly how much you’re willing to spend on a car, and DO NOT go over that amount. Salesmen will try to talk you into buying more – don’t accept their sales talk.  All they want from you is your money.  They’re not your friend, and do not try to be their friend.  It will not get you any discounts.  I always offer 20-25% less than what they’re asking, and let them talk me up.  If they won’t give you the price you want to pay for the car you want, then walk away.  Make sure they have your phone number if they change their mind, but do not go above your budget.  There are a lot of cars out there. Keep looking.  You’ll find what you want.

Do not compromise. Compromising on what you want only satisfies the dealer, not you.  You’re spending a lot of money on a car, make sure you get exactly what you want.

Remember on-road costs like fees, taxes, stamp duty, insurance, registration, etc… These are essential costs that need to be factored into used car purchases where applicable, and your budget needs to take those into account.  Everything is negotiable, however, so don’t let that put you off.  I’ve purchased cars that have included extra registration and insurance ‘thrown in’ for free, at the dealer’s expense.

Do not be afraid to ask for what you want. The worst that can happen is that the dealer will say NO.  It’s not the end of the world.  If they don’t want to give it to you for the price you want to pay, WALK AWAY.  Don’t be afraid to walk away!  You’ll be amazed at how many dealers will come back to you and say “If we were to give you what you want, will you take the car at that price today?” YES!

And now for the new car. I’m not an expert on this, by any means, but there’s a few things to do when you’re looking for a new car.

Understand how much you’re willing to spend, including all fees, etc.

Do your research into what kind of new car will satisfy your needs.

Test drive the cars that fit what you’re looking for. Most new cars will be nice to drive, but that’s why you need to understand your needs, so that you can see if the car will fit them.  Visualise owning the car in a year’s time, and whether or not it will be doing everything for you that you want it to.  If you don’t think it will satisfy you, don’t get it. Keep looking for the car that will satisfy you.  Some new car dealers will only let you test drive a car by appointment only.  Do not be afraid to make appointments to test drive their cars.  You’re the buyer, you have all the power.  Booking an appointment shows you’re interested, and they will do what they can to make sure your experiences are satisfying.

Sales people will try to ‘close you’ by asking you questions that you have to say ‘yes’ to. Every ‘yes’ you say is one ‘yes’ closer to “So you’ll take the car now?” Buying a car has to be on your terms, not theirs.  Avoid answering the questions that are designed to lead you to buying the car.  Give them information they might need to know to help you out, but don’t say yes until you’re ready to sign on the dotted line.

Use a car broker. Tell them what you want, including the options you want on the car, and they’ll put out a ‘request for quote’ to all the new car dealers around the country.  These dealers will try to outbid each other to give you the lowest price available in order to move their stock. Not many people use brokers, but for the nominal fee they charge, the savings they can bring you are definitely worth it.

Research the best way to buy a new car for yourself. Ideally, pay cash for it.  If you can’t pay cash (not many can!) then you’ll need to organise finance.  Shop around for the best interest rate.Investigate whether or not you can lease a car.  This will be determined by your career or employment situation.

You might also be able to salary sacrifice your lease, depending on the laws and facilities within your country.  In Australia, you can salary sacrifice all kinds of things, including leased cars.

You can get a ‘novated lease’, which includes all running costs in the cost of the lease (like petrol, insurance, registration, maintenance, etc), and you can ‘salary sacrifice’ the payments. And don’t forget that you can get fleet discounts and you don’t pay GST on the value of the car, which reduces the price even further. What this means is that your lease payments are deducted from your pre-tax income, which then reduces your taxable income, resulting in you paying less tax.  To my calculations, the savings are usually equivalent to the approximate value of your tax rate.

How this works is like this.  (I’ll use the tax rate in Australia, because that’s what I’m familiar with, but make sure you do your research in your own country.)  If you earn $85k a year, you pay 38% tax which leaves you with about $64k.  Let’s say you lease a $40,000 car and you’re paying $17,000 a year in total for the lease (including all costs like petrol, insurance, etc).  This $17k comes out of your $85k before tax, leaving you with a taxable income of $68k.  You pay 30% tax on this, leaving you with $53k.So, in effect, the lease has only cost you ($64k – $53k =) $11k a year instead of $17k.  You’ve just made a saving of $6k a year, or 35%.  And this is a saving applying to all costs included in the lease (eg. petrol, insurance, etc).

Never use the finance provided by the car dealer. They have an incentive to get you to use their finance because they get a percentage of the interest you pay.  For this reason, dealer financing will always be more expensive than other financing.

I think that should do for now.  I guess above all, don’t rush in to buy a car.  Research, test drive as many as you want, and take your time to make this decision that’s going to affect you for the next few years.

And enjoy your car when you get it!

If you’re reading this and you have some tips of your own, please feel free to add them in the Comments section.  And if you think this is worth sharing, please don’t hesitate to share!

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Self-made men

July 13, 2009 · 0 comments

One of the things that is important to me is embracing masculinity. Men used to be men, but they’re not so much that any more. I try to encourage men to become more masculine, and embrace the essence of who they are. To stop being ‘girly men’, and just to be men.

To that end, I’d like any men interested in becoming more masculine to have a read of the following article I found on the Art of Manliness website.  Please enjoy.

Self-Made Men

By: Frederick Douglass

fred1That there is, in more respects than one, something like a stoicism in this title, I freely admit. Properly speaking, there are in the world no such men as self-made men. That term implies an individual independence of the past and present which can never exist,

Our best and most valued acquisitions have been obtained either from our contemporaries or from those who have preceded us in the field of thought and discovery. We have all either begged, borrowed, or stolen. We have reaped where others have sown, and that which others have strown, we have gathered. It must in truth be said, though it may not accord well with self-conscious individuality and self-conceit, that no possible native force of character, and no depth of wealth and originality, can lift a man into absolute independence of his fellowmen, and no generation of men can be independent of the preceding generation. The brotherhood and interdependence of mankind are guarded and defended at all points. . .

Nevertheless, the title of my lecture is eminently descriptive of a class and is, moreover, a fit and convenient one for my purpose, in illustrating the idea which I have in view…Self-made men are the men who, under peculiar difficulties and without the ordinary helps of favoring circumstances, have attained knowledge, usefulness, power and position and  have learned from themselves the best uses to which life can be put in this world, and in the exercises of these uses to build up worthy character. They are the men who owe little or nothing to birth, relationship, or friendly surroundings; to wealth inherited or to early approved means of education; who are what they are, without the aid of any favoring conditions by which other men usually rise in the world and achieve great results. . . They are in a peculiar sense indebted to themselves for themselves. If they have traveled far, they have made the road on which they have travelled. If they have ascended high, they have built their own ladder . . . Such men as these, whether found in one position or another, whether in the college or in the factory; whether professors or plowmen; whether Caucasian or Indian; whether Anglo-Saxon or Anglo-African, are self-made men and are entitled to a certain measure of respect for their success and for proving to the world the grandest possibilities of human nature, of whatever variety of race or color.

Though a man of this class need not claim to be a hero or to be worshipped as such, there is genuine heroism in his struggle and something of sublimity and glory in his triumph. Every instance of such success is an example and help to humanity. It, better than any mere assertion, gives us assurance of the latent powers and resources of simple and unaided manhood. It dignifies labor, honors application, lessens pain and depression, dispels gloom from the brow of the destitute and weariness from the heart of him about to faint, and enables man to take hold of the roughest and flintiest hardships incident to the battle of life, with a lighter heart, with higher hopes and a larger courage.

The Theory of Self-Made Men

The various conditions of men and the different uses they make of their powers and opportunities in life, are full of puzzling contrasts and contradictions. Here, as elsewhere, it is easy to dogmatize, but it is not so easy to define, explain and demonstrate. The natural laws for the government, well-being and progress of mankind, seem to be equal and are equal; but the subjects of these laws everywhere abound in inequalities, discords, and contrast. We cannot have fruit without flowers, but we often have flowers without fruit. The promise of youth often breaks down in manhood, and real excellence often comes unheralded and from unexpected quarters.

The scene presented from this view is as a thousand arrows shot from the same point and aimed at the same object. United in aim, they are divided in flight. Some fly too high, others too low. Some go to the right, others to the left. Some fly too far, and others, not far enough, and only a few hit the mark. Such is life. United in the quiver, they are divided in the air. Matched when dormant, they are unmatched in action.

When we attempt to account for greatness we never get nearer to the truth than did the greatest of poets and philosophers when he classified the conditions of greatness: “Some are born great, some achieve greatness and some have greatness thrust upon them.” We may take our choice of these three separate explanations and make which of them we please, most prominent in our discussion. Much can certainly be said of superior mental endowments, and I should on some accounts, lean strongly to that theory, but for numerous examples which seem, and do, contradict it, and for the depressing tendency such a theory must have on humanity generally.

This theory has truth in it, but it is not the whole truth. Men of very ordinary faculties have, nevertheless, made a very respectable way in the world and have sometimes presented even brilliant examples of success. On the other hand, what is called genius is often found by the wayside, a miserable wreck; the more deplorable and shocking because from the height from which it has fallen and the loss and ruin involved in the fall. . .

I do not think much of the good luck theory of self-made men. It is worth but little attention and has no practical value. An apple carelessly flung into a crowd may hit one person, or it may hit another, or it may hit nobody. The probabilities are precisely the same in this accident theory of self-made men.  It divorces a man from his own achievements, contemplates him as a being of chance and leaves him without will, motive, ambition and aspiration. Yet the accident theory is among the most popular theories of individual success. It has about it the air of mystery which the multitudes so well like, and withal, it does something to mar the complacency of the successful.

It is one of the easiest and commonest things in the world for a successful man to be followed in his career through life and to have constantly pointed out this or that particular stroke of good fortune which fixed his destiny and made him successful. If not ourselves great, we like to explain why others are so. We are stingy in our praise to merit, but generous in our praise to chance. Besides, a man feels himself measurably great when he can point out the precise moment and circumstance which made his neighbor great. He easily fancies that the slight difference between himself and his friend is simply one of luck. It was his friend who was lucky but it might easily have been himself. Then too, the next best thing to success is a valid apology for non-success. Detraction is, to many, a delicious morsel. The excellence which it loudly denies to others it silently claims for itself. It possesses the means of covering the small with the glory of the great. It adds to failure that which it takes from success and shortens the distance between those in front and those in the rear. Even here there is an upward tendency worthy of notice and respect. The kitchen is ever the critic of the parlor. The talk of those below is of those above. We imitate those we revere and admire.

But the main objection to this very comfortable theory is that, like most other theories, it is made to explain too much. While it ascribes success to chance and friendly circumstances, it is apt to take no cognizance of the very different uses to which different men put their circumstances and their chances.

Fortune may crowd a man’s life with fortunate circumstances and happy opportunities, but they will, as we all know, avail him nothing unless he makes a wise and vigorous use of them. It does not matter that the wind is fair and the tide at its flood, if the mariner refuses to weigh his anchor and spread his canvas to the breeze. The golden harvest is ripe in vain if the farmer refuses to reap. Opportunity is important but exertion is indispensable. . .

When we find a man who has ascended heights beyond ourselves; who has a broader range of vision than we and a sky with more stars in it in than we have in ours, we may know that he has worked harder, better and more wisely than we. He was awake while we slept. He was busy while we were idle and was wisely improving his time and talents while we were wasting ours . . .

I am certain that there is nothing good, great or desirable which man can possess in this world, that does not come by some kind of labor of physical or mental, moral or spiritual. A man, at times, gets something for nothing, but it will, in his hands, amount to nothing. What is true in the world of matter, is equally true in the world of the mind. Without culture there can be no growth; without exertion, no acquisition; without friction, no polish; without labor, no knowledge; without action, no progress and without conflict, no victory. A man that lies down a fool at night, hoping that he will waken wise in the morning, will rise up in the morning as he laid down in the evening. …

From these remarks it will be evident that, allowing only ordinary ability and opportunity, we may explain success mainly by one word and that word is WORK! WORK!! WORK!!! WORK!!!! Not transient and fitful effort, but patient, enduring, honest, unremitting and indefatigable work into which the whole heart is put, and which, in both temporal and spiritual affairs, is the true miracle worker. Everyone may avail himself of this marvelous power, if he will. There is no royal road to perfection. Certainly no one must wait for some kind of friend to put a springing board under his feet, upon which he may easily bound from the first round of their ladder onward and upward to its highest round. If he waits for this, he may wait long, and perhaps forever. He who does not think himself worth saving from poverty and ignorance by his own efforts, will hardly be thought worth the efforts of anybody else.

The lesson taught at this point by human experience is simply this, that the man who will get up will be helped up; and the man who will not get up will be allowed to stay down. This rule may appear somewhat harsh, but in its general application and operation it is wise, just and beneficent. I know of no other rule which can be substituted for it without bringing social chaos. Personal independence is a virtue and it is the soul out of which comes the sturdiest manhood. But there can be no independence without a large share of self-dependence, and this virtue cannot be bestowed. It must be developed from within. . .

In the idea of exertion, of course fortitude and perseverance are included. We have all met a class of men, very remarkable for their activity, and who yet make but little headway in life; men who, in their noisy and impulsive pursuit of knowledge, never get beyond the outer bark of an idea, from a lack of patience and perseverance to dig to the core; men who begin everything and complete nothing; who see, but do not perceive; who read, but forget what they read, and are as if they had not read; who travel but go nowhere in particular, and have nothing of value to impart when they return. Such men may have greatness thrust upon them but they never achieve greatness. …

But in this awarding praise to industry, as the main agency in the production and culture of self-made men, I do not exclude other factors of the problem. I only make them subordinate. Other agencies cooperate but this is the principal one and the one without which all others would fail.

But another element of the secret of success deserves a word. That element is order, systematic endeavor. We succeed, not alone by the laborious exertions of our faculties, be they small or great, but by the regular, thoughtful and systematic exercise of them. Order, the first law of heaven, is itself a power. The battle is nearly lost when your lines are in disorder. Regular, orderly and systematic effort which moves without friction and needless loss of time or power; which has a place for everything and everything in its place; which knows just where to begin, how to proceed and where to end, though marked by no extraordinary outlay of energy of activity, will work wonders, not only in the matter of accomplishment, but also in the increase of the ability of the individual. It will make the weak man strong and the strong man stronger; the simple man wise and the wise man, wiser and will insure success by the power and influence that belong to habit . . .

There is still another element essential to success, and that is, a commanding object and a sense of its importance. The vigor of the action depends upon the power of the motive. . . Work is not often undertaken for its own sake. The worker is conscious of an object worthy of effort, and works for that object; not for what he is to it, but for what it is to him. All are not moved by the same objects. Happiness is the object of some. Wealth and fame are the objects of others. But wealth and fame are beyond the reach of the majority of men, and thus, to them, these are not motive-impelling objects. Happily, however, personal, family and neighborhood well-being stand near to us all and are full of lofty inspirations to earnest endeavor, if we would but respond to their influence.

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13. Getting rich – getting into the right business

3 April 2009

[Taken from the book The Science of Getting Rich by Wallace D. Wattles] SUCCESS, in any particular business, depends for one thing upon your possessing in a well-developed state the faculties required in that business. Without good musical faculty no one can succeed as a teacher of music; without well-developed mechanical faculties no one can […]

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12. Getting rich – efficient action

26 March 2009

[Taken from the book The Science of Getting Rich by Wallace D. Wattles] YOU must use your thought as directed in previous chapters, and begin to do what you can do where you are; and you must do ALL that you can do where you are. You can advance only by being larger than your […]

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11. Getting rich – acting in the Certain Way

20 March 2009

[Taken from the book The Science of Getting Rich by Wallace D. Wattles] THOUGHT is the creative power, or the impelling force which causes the creative power to act; thinking in a Certain Way will bring riches to you, but you must not rely upon thought alone, paying no attention to personal action. That is […]

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10. Getting rich – further use of the Will

18 March 2009

[Taken from the book The Science of Getting Rich by Wallace D. Wattles] YOU cannot retain a true and clear vision of wealth if you are constantly turning your attention to opposing pictures, whether they be external or imaginary. Do not tell of your past troubles of a financial nature, if you have had them, […]

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9. Getting rich – how to use the Will

12 March 2009

[Taken from the book The Science of Getting Rich by Wallace D. Wattles] TO set about getting rich in a scientific way, you do not try to apply your will power to anything outside of yourself. You have no right to do so, anyway. It is wrong to apply your will to other men and […]

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8. Getting rich – thinking in the Certain Way

11 March 2009

[Taken from the book The Science of Getting Rich by Wallace D. Wattles] TURN back to [chapter 6] and read again the story of the man who formed a mental image of his house, and you will get a fair idea of the initial step toward getting rich. You must form a clear and definite […]

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7. Getting rich – gratitude

5 March 2009

[Taken from the book The Science of Getting Rich by Wallace D. Wattles] THE illustrations given in the last chapter will have conveyed to the reader the fact that the first step toward getting rich is to convey the idea of your wants to the Formless Substance. This is true, and you will see that […]

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6. Getting rich – how riches come to you

4 March 2009

[Taken from the book The Science of Getting Rich by Wallace D. Wattles] WHEN I say that you do not have to drive sharp bargains, I do not mean that you do not have to drive any bargains at all, or that you are above the necessity for having any dealings with your fellow men. […]

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