Your first big purchase — usually a car Your first big purchase — usually a car Unit 4 — Planning ahead Unit 4 — Planning ahead Your first big purchase — usually a car Your first big purchase — usually a car The sticker price is the smallest number in a car purchase. The sticker price is the smallest number in a car purchase. Lesson 8 of 8 — about 14 minutes — CareerStart.ai Financial Literacy Lesson 8 of 8 — about 14 minutes — CareerStart.ai Financial Literacy What you will be able to do What you will be able to do What you will be able to do What you will be able to do By the end of this lesson By the end of this lesson 1 Identify the full cost of ownership Identify the full cost of ownership 2 Explain how loan term affects total cost Explain how loan term affects total cost 3 Prepare before walking onto a lot Prepare before walking onto a lot Total cost, not monthly payment Total cost, not monthly payment Unit 4 — Planning ahead Unit 4 — Planning ahead Total cost, not monthly payment Total cost, not monthly payment Dealers negotiate in monthly payments because a longer loan makes any price look affordable. Stretching a loan from 48 to 84 months lowers the payment and raises the total substantially — and for much of that time you owe more than the car is worth. Dealers negotiate in monthly payments because a longer loan makes any price look affordable. Stretching a loan from 48 to 84 months lowers the payment and raises the total substantially — and for much of that time you owe more than the car is worth. Ownership also costs beyond the loan: insurance (expensive for young drivers), fuel, maintenance, tires, registration, and repairs. A $200 payment on a $450 monthly reality is how budgets break. Ownership also costs beyond the loan: insurance (expensive for young drivers), fuel, maintenance, tires, registration, and repairs. A $200 payment on a $450 monthly reality is how budgets break. Arrive prepared Arrive prepared Unit 4 — Planning ahead Unit 4 — Planning ahead Arrive prepared Arrive prepared Get pre-approved for financing at a bank or credit union before you shop; it gives you a rate to compare against and removes the dealer’s strongest lever. Know the vehicle’s market value. Get a used car inspected by an independent mechanic — it typically costs around a hundred dollars and regularly saves thousands. Get pre-approved for financing at a bank or credit union before you shop; it gives you a rate to compare against and removes the dealer’s strongest lever. Know the vehicle’s market value. Get a used car inspected by an independent mechanic — it typically costs around a hundred dollars and regularly saves thousands. And be willing to leave. That is the only real negotiating power anyone has. And be willing to leave. That is the only real negotiating power anyone has. Key term: Upside down Key term: Upside down Key term Key term Upside down Upside down Owing more on a loan than the item is worth. Common with long car loans, because vehicles lose value faster than the balance falls. It becomes a serious problem if the car is totaled or you need to sell. Owing more on a loan than the item is worth. Common with long car loans, because vehicles lose value faster than the balance falls. It becomes a serious problem if the car is totaled or you need to sell. Why it matters at work Why it matters at work Why it matters at work Why it matters at work Reliable transportation is a job requirement in most of this region — which is exactly why it is worth buying carefully rather than quickly. Reliable transportation is a job requirement in most of this region — which is exactly why it is worth buying carefully rather than quickly. ← Previous Mark complete Next: Final assessment →
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