Buying a Car: Lessons in being a savvy consumer in all large purchases.

In my PsychologyToday.com article today, I describe how I just bought a new car. It offers lessons not just on buying a car but on making any large purchase.

Should You Replace Your Car?

Other than perhaps a house or education, we spend more on buying cars than anything. The average cost of one is now $33,000 plus 68 months of interest. 

Should you spring for one? As my PsychologyToday.com article today, I offer an internal debate that may help you clarify.

Buying a Car at a Great Price...With Ease

My wife wanted a new car. We view a car as basically an appliance, with reliability trumping everything, so we always buy a Toyota.

We went to the company website to look at models, options, and colors and decided on an ES300h.

We then test drove it and loved it but didn't want to buy just yet. We went home and, for $14, bought Consumer Reports' New Car Price Report. That promised to state what the dealer actually paid for the base car plus any options, which is usually well below the invoice price. Dealers may show you the invoice to try to convince you you're getting a good deal but they usually pay far less--the manufacturer gives the dealer money for each car sold that doesn't show on the invoice.

That Consumer Reports Price Report also allows you to request a price, by email, from local dealers. I received prices from a few, then I visited their websites so see if they had the car in the color and with the options I wanted.

I then phoned the three dealers that had my desired car on the lot but I didn't accept their e-mailed price. Instead, I explained that I know that true dealer cost is much below invoice and that I'm calling dealers to get the best price. I reassured the salesperson that I'm a serious buyer and if I can get a rock-bottom price, I'll come in and buy the car immediately, no games-playing. One of them said he'd sell me the car at $2,000 under invoice, far lower than what the Consumer Reports Report said the car cost the dealer! I said, "Email me that in writing and you have a deal." He did and we did.

We love the car.