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debt

Let’s face it, you aren’t going to get squat for your car at the dealership so the only way you can maximize your profit is to sell it yourself.  When I was getting ready to buy my wife’s new car we talked to the dealership and they were thinking $3,500 or less, we talked to CarMax and they were willing to put up $4k. Kelley Blue Book value for the car, private party, was $7k in excellent shape. That is a pretty damn big disparity between what the dealerships would give me and what I should be able to get. I decided to say screw the dealerships and sell my car myself.

Don’t make any mistakes, it isn’t a cake walk to sell it on your own, but then again when was last time three grand fell in your lap while you were lazing around doing nothing. While it does take some work it is actually pretty easy to unload that old car in a pretty short amount of time. If you are asking yourself how you to can master the art of being a car salesman, you are in luck but first lets look at how you shouldn’t do it and tomorrow we will look at how you should go about selling your car.

The Old Way

Way back in the day, ok maybe not all that long ago, people who wanted to sell a car on their own had to rely on some pretty in effective methods for selling their cars. One method involves creating a sign you put in the window, or write on the window, advertising your vehicle is for sale. This sounds like a good idea but you are really just hoping that someone in a car passing you on the Interstate is in the market for a car. The likelihood is pretty low that you are going to find that killer buyer randomly driving down the road you are driving on. In method that is the same but different people put signs in the car window then park it near a busy street. This way you are increasing views as well as ensuring someone could stop and actually write down the number to call. The problem here is you are still relying on your buyer just happening on your car, odds are they aren’t out cruising up and down the road looking for a car to buy.

These first two methods are like walking into a crowded room of random people and asking each one of them if they want to buy a car. Odds are you going to go through a whole lot of people before you find one who says they are interested in a car. Even when you find that one person they may want a minivan when you are selling an SUV. You get a lot of looks but interested parties are hard to come by.

The most effective of the “old ways” was to list your car for sale in the classifieds section of your local newspaper. This method works because you are putting your vehicle in a listing where people who want a car will be looking. The problem is words can only be so descriptive. If you say great condition I don’t know it is without coming to see it. If you say it is a red convertible, is it candy apple red, blood red, brick red, or pinkish red? I can’t tell from the words in the ad. In addition to the lack of visual sales appeal a lot of papers charge for your ad to run, that cuts into your profits.

I am not trying to say you shouldn’t do these things.  I immediately put a sign in my cars window when I was selling my car. It didn’t hurt anything and you never know when you might drive by that car thirsty teenager with a wad of cash. If you don’t need to drive your car around by all means park it in an place where you can advertise it’s availability. Just don’t rely on it as your sole method of selling the car, there are such better ways, but more on that tomorrow.

Have you ever successfully sold a vehicle using one of these traditional tactics? Tell us about it in the comments.

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I like to write about money, finance, my life, and typical suburban living. I don’t pretend to be a finance expert. Hell, I am not even close. I don’t pass judgement on someone based on a single decision they have made in their lives. It would be ridiculous to do something like that without knowing all of the facts yet people pass these kind of judgement everyday.  I bring it up because of a comment I got on my Friday Finance Followers post last week.

Generally speaking I am pretty debt averse. I don’t like having it hanging over me but I am not a hardcore Ramseyite either. I believe in the responsible use of money to better your life NOW as well as in the future. In that vein there are several things about me that are somewhat anti-frugal/not hardcore PF. Of course these are things not so surprising to most people but the hardcore crowd would scoff at my choices. Lets look at the two biggies:

1.) I just bought my wife a car, and took out a loan… GASP, SHOCK, *faints*. Wait, but not only did I buy my wife a car I bought her an Infiniti QX56. Oh Snap, its a luxury car too I must have gone off my rocker B. It is funny because people already start to comment about this car. The fact is it is an expensive car but not ridiculous, our payments are less than payments on our previous car and all told, interest included, we will not be paying more than the blue book value of the car when we bought it. I know it will depreciate yadda, yadda. The kicker on that is that we aren’t changing our saving habits (they will actually be increasing), just our spending habits (decreasing baby). You see not having any debt has actually been kind of bad for us. When you know there is nothing coming out your spending starts to creep up. In my opinion that is actually worse than having a loan. We will be getting our spending back in check to help pay for the car and bring reality back into focus. Our mission is to eliminate the car loan in 2 years or less, look for a goal meter to be popping up next month.

2.) I own a boat. Yupper baby, my own floating money pit sitting right in my garage. In comparison to my wife’s new ride our boat is more like like a Chevy or a Ford, it runs great but isn’t that flashy. I am not ashamed to say that I will probably have a boat in my garage for a very long time. Not necessarily that boat but A boat. I have very few true obsessions in my life. Just my wife, kids, computers, and being on the water. It brings me great joy to hit the water and relax. That joy is worth the pain of owning a so called “money pit.” If I spend all of my time stashing away EVERY penny I am going to lose out on a lot of things I can do now but may not be able to do later. I am probably not going to be wake boarding at 50 but in my late 20’s it is fair game.  I would like to enjoy life a little now, and a little bit later (within reason).

The key with personal finance, as with the rest of your life, is to be responsible. Be responsible with how you spend, save, and interact with money and you will be better off. I know from looking at my cash flow right now that this is not in any way irresponsible of me. The loan I took out was minimal and well within the responsible range. I have not in any way over extended myself or put my family in a position where we would have to decide between food or transportation. Having debt is not irresponsible, having so much debt you can no longer control the spiral is.

That is my two cents, what do you think? Should I give up blogging about finance because I took out a loan?

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Usually I see bloggers posting questions from their readers about what they should do in certain situations. No one asks me any questions so I thought I would lay my own dilemma out there for you. My wife and I own two cars both of the are paid in full. I love the fact that I have the title to both of these cars and aside from fuel and maintenance they don’t cost me anything. I know a lot of people who wish they didn’t have a car payment and let me tell you I love the hell out of it.

Recently my wife has decided it is time for her to pick up a new car, the old one is just old to her now. Not only does she want a new car but she wants a 2007 or newer Black Chevy Tahoe. I don’t know if you have ever priced out a Tahoe before but a 2007 with decent miles costs at least $10k more than we paid for either one of the cars we own now. I attempted to explain how ludicrous it is to even consider such a thing as buying a new car, “why the hell do you want a new car the one you have is fine, I won’t have it PERIOD.

For those of you married men out there, telling your wife she can’t do something is the equivalent of punching them in the face with a brick in your hand, they don’t like it. I still haven’t completed recovered from this little misstep although she did soften her resolve for a few months. We had discussed the option of a car swap, where I take her car and she takes mine. That way the cars are new, to us anyway. To me this was the best solution to the problem and one I embraced wholly. The only things I need to take care of are some new tires and window tint which I have been dragging on but plan to take care of soon.

Thinking that was the end of it I forgot about the dilemma entirely, until recently. I have caught my wife once again perusing the ranks of CarMax in search of the perfect used Tahoe with the occasional “Oh, look at this one Kyle it is only $36k.” Which usually results in me coughing and choking on my beer.

The way I see it is that I am failing to adequately support my desire for not wanting another car payment, these are the facts I think lean most  towards us not purchasing, with a loan, a new car:

  1. Both Cars are in good working condition
  2. Out of the two of us working I am the only one contributing to a retirement account
  3. With two children we are saving $0 per month for higher education
  4. Student loan has not been paid off
  5. Second mortgage has not been paid off

My wife really wants a new car, and I don’t want her to be unhappy I just don’t think it is the best thing for us financially right now. The fact that this hasn’t been worked out yet is probably 90% my fault for failing to communicate adequately.  What would you do in this situation? What should I do?

No bashing my old lady, she is entitled to her wants just like anyone else, help us out an weigh in on the problem.

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Is Debt Really What is Keeping you Down?

November 19, 2009

A lot has been said across personal finance books and blogs about the danger of debt and how the elimination of debt can speed you on your way to “financial freedom.” While debt is certainly a hurdle which could prevent you from maximizing your earning potential I don’t think it is THE reason you aren’t […]

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When Debtors Go AWOL

October 20, 2009

When you owe people money you want to hide in a corner and hope that something happens to change your situation. Hey that ten dollars worth of lotto tickets is going to come through this time.  A lot of people take the road of avoidance as a way to deal with past due bills in […]

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