The less of our income we give away needlessly, the more we can save. This is a crucial step in powering up our savings accounts.
Like many others, my wife and I were so caught up with the monthly payments we would have been required to make on our first car note that we overlooked the overall cost. Though we had very good credit scores, our obsession with the monthly payments allowed the dealer to abuse us with such a ridiculously high interest rate, it should have been illegal.
That experience forced me to adopt the practice of focusing on the overall cost of each item I buy. Now, I work with the seller to lock down the overall item cost because that is the only thing I am dependent on the seller to provide. In the case of a car, it is called the drive-out price. I shop elsewhere for a reasonable loan rate and if the seller has something to offer, they have to exceed my expectations. If not, I would just use the loan I have secured elsewhere.
The seller should not be relied upon in determining what is best for me because their input cannot be unbiased; therefore, I determine terms such as interest rate, length of loan, and monthly payments without their input. They have some input with the purchase price of the item, but not much because I would have already determined what the item can be sold for and that is the number, I present to them. I do not have any discussions with them about the monthly payments. There are so many resources available online these days that we should already have our numbers in place by the time we approach the seller.
I have been fortunate to come across some wonderful and/or God-fearing people in sales, but in the end, I am always reminded that it is just business and the agents are not our friends at that moment… as we all know, business and friendship do not mix very well.