Personal Finance Series: No 17 – Fun, Fear, and Car Salesmen

The mind can play a number of tricks when it comes to buying a car, but one thing that rarely features in the decision making is any consideration to the personal finance budget.

People don’t need a financial planning calculator, or even an affordability calculator when it comes to buying a car, although they are still the single biggest financial commitment beyond a mortgage. Of the 14 different ways the brain compartmentalises spending, Acquiring Transport is one of the biggest undertakings and covers brand new as well as second hand cars, motorcycles and mopeds.

Acquiring Transport usually requires considered thought, common sense suggests consulting the family budget worksheet, the personal finance spreadsheet on the basis of affordability, but that’s not what happens in reality.

Acquiring Transport: The Secret Manipulations Of The Car Showroom

Whether it be brand new, or second hand vehicles, most people have a sense that car salespersons have a stereotypical image. It doesn’t matter where in the world, the first thing which greets a prospective customer is a wall of teeth, an outstretch hand, and an open question designed to find out your budget – thus qualify early and set the stage for what happens next. These professionals have but one objective – to sell, and the variety of manipulations are boundless.

“Another person wants the car, and is on the way in to view it” is meant to inject fear of loss and scarcity into you, lowering your price resistance.
“The price goes up at midnight”, is another one to put pressure on making a decision.
“I need to ask the boss”, is a big favour to you as a reward and also allows the 3rd party negotiator to impose on you and the salesman, designed to oblige you in commitments.
The Test Drive is all about getting you to future-pace and imagine yourself driving the vehicle all while distracted and answering more open questions from your new buddy to help him close you later in the negotiation.
The strategy for overcoming these and other tactics is to plan in advance, research the dealer price and your budget limit. Work out what you want the car for, and to do and whether the added extras are really worth it. Work up from dealer price not back from advertised price.

Power dress at an equivalent or higher level, and if buying on finance, have your own finance in place before you go. Never reveal your budget and be wary of the information you give out in the ‘chat’

Be prepared to walk away or ‘speak to your partner’ and play the salesman off against the other dealership down the road who offered you a better deal on the same car.

Acquiring Transport: Why People Name their Cars

An old joke says that men give their cars female names because they can be temperamental just like women. The reality of why people name their cars though is probably because they move, because they are seen as active, and because people spend so much time in their cars, they become personalised parts of life.

Over time, cars do develop characteristics depending on how they are driven and these become ‘personalities’ People take a pride in and have personal connection to their cars -the scientific name for this naming relationship is anthropomorphism, but cars and motorcycles mean emotional things rather than only logical things to their owners

Acquiring Transport: Emotional v Logical Spending

There are a number of factors which influence vehicle buying decisions like family recommendations, the main purpose for the car, the lifestage being serviced and the age of the buyer.

Vehicle advertising splits into fun branding, fear branding – focusing on safety benefits, and vanity benefits, focusing on the looks, benefits, and feelings for the buyer.

Acquiring Transport ought to be a logical decision based on cost, monthly repayment plan costs, price, and the benefits to be gained ought to be oriented around travel and comfort only. Unseen, hidden costs however, include customisations to the vehicle, ornaments, gadgets, toys, accessories and other personalisations.

People for whom vehicles have not taken on any personal can be well served in their preparations by using goal setting functions in personal finance software online, and other personal finance online tools which allow to track the money coming in and the money going out to weigh the longer term impact of monthly repayments using a personal finance forecast.

By stepping back and looking at the wider financial picture, it is possible to neutralise the worst manipulations of being a target and still enjoy the experience of buying a new ride. It all depends on the starting position, the attitude to the negotiation, and the presence of a sensible personal finance budget online.

Mark Donnan is A former CEO in Financial Services and the author of the personal finance books Negotiating Breathing Space with your Creditors, and Debt Management Secrets, and is the creator of

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