First-Time Buyers

Our Take

Maybe you've just graduated, maybe Mom's hand-me-down minivan finally broke down, or maybe you grew up in the city and took public transit all your life. Regardless of why, you need to buy your first car, and we're here to help.

New or used?

Generally speaking, today's cars are more reliable than ever before. Hitting 100,000 miles is commonplace, and over 150,000 isn't unheard of. Buying a used car may fit your budget, and the newer ones may still have some warranty left. New cars depreciate more quickly as initial purchases, but you can often get lower financing rates on them. You can also only get automaker lease deals on new cars. New-car warranties can often be as long as five, seven, or 10 years.

Choosing a car

Many car companies are building entry-level models today that are getting very good reviews. Read up on them, and then test drive them to see what you like. Don't settle for the first car you see. Think about whether a car will fit your life in the near term, and in the long run. Will you always be living where you live and working where you work? Are you getting married? Having kids? Will your car payment outlast your lifestyle?

Watch the warranty

Just because a car company advertises a warranty lasts a certain period doesn't mean it will cover every item that goes wrong. Even the most comprehensive, "scheduled maintenance included" warranties rarely cover lightbulbs and tires, and most warranties only cover the engine and transmission and nothing else for the last few years. Plan for some out-of-pocket expenses, and learn about your car to find out what may go wrong.

Beware of financing

There's nothing wrong with paying for a car over time, as long as you do your homework first. First, make sure that you negotiate a car's final price, not the monthly payment. You'd be surprised how many people agree to an attractive monthly payment only to find out they are getting a lousy interest rate, or they're paying for 72 months instead of 48. Next, shop around for a rate. Don't settle for what your dealer gives you until you check out your local credit union for better offers.

Be wary of car loans that stretch out over an extremely long payment period. Your car may start needing expensive repairs after five years, or you might simply become bored of it. Finally, make sure you commit to a large enough down payment or structure your monthly payments so that you don't end up upside-down, owing more than the car is worth.

Our picks

Here are some new cars that may be good picks for first-time buyers, regardless of what stage of life they're in or how much money they've got available.