Should you buy a new or used car? How to make the best financial decision

Buying a new or used car is always a big undertaking — after all you’re making a major financial decision.

Financial expert Preet Banerjee shared some essential tips to keep in mind when buying a vehicle on a recent segment of The Morning Show.

While you may be set on buying either a new or used car, Banerjee suggests not having a “closed mind.” He says be open to both options and weigh the pros and cons.

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The next step is to decide whether or not you want to use a car dealer or a private seller.

While private sellers can provide “more options,” car dealers give you “peace of mind because you’ve got a brand, a reputation to stand behind,” he said.

If you want to save some money and still trust the brand, don’t be hesitant to go for “pre-owned” cars certified by car dealers.

READ MORE: How to buy a car without getting swindled

“It may come with extra warranty with extra years,” he added.

He suggests car dealerships can be convenient because they allow you to do “all the paperwork and financing in one place, reducing the hassle factor.”

However, a car broker can also help you to reduce the hassle by negotiating for you, he said. All you have to do is give your requirements, ask for options and pick your car.

READ MORE: How much should you spend on a car?

“If you want, you can also have the car delivered to your home,” he said.

“The broker might charge a flat fee for that.”

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If you have bad credit, he said it can impact your interest rate. “Balloon payments can catch you off-guard.”

Keep in mind that it is important to get an insurance quote before you make an offer, he added.

“You might be surprised to see how much it costs to insure cars of the same class.”

To learn more about deciding whether to buy a new or used car, watch the full video above.