Clark Biweekly 6 20 24

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There are a lot of things to consider when buying a car, price being one of them. Find out what costs to look for later in this email.

💵 Today’s Top Stories

🚘️ Look Beyond a Car’s Price Tag and Consider Total Cost

Back in the day, when you visited a car dealership, you needed to ignore the “four-square” monthly payment your salesperson pitched you and instead focus on total cost.

That’s still true. But if you focus only on the total cost of your vehicle purchase, you’ll miss many high-impact “hidden costs.”

To wit: buyers are enamored with used vehicles right now. Used car sales volumes rose 11% from Q4 2023 to Q1 2024. New car sales volumes fell 2%.

It makes sense considering the price tag … of the vehicles themselves. New car prices are down 1% year-over-year. But used cars are down 14%.

However, there are other factors. Consider, for example, that car repairs are up 9.5% year-over-year (and the average service transaction is up 45% in three years). Used vehicles are more likely to need repairs.

Other “hidden” cost trends:

-Buyers are spending ~$4,250 more in interest payments over the life of their auto loans vs. 2021.

-Over 20% of car buyers are upside down on their loans as of Q1. Some bought at the peak of the market during COVID-19 and experienced aggressive depreciation in market value. That’s leading to trade-ins that are worth less as well as longer, more expensive auto loan terms.

-Car insurance is up 20% year-over-year as of May. Your premiums can vary wildly by make, model and insurance provider.

-Car companies are spending 69% more on incentives year over year ($3,274 per car or 6.9% of the average purchase price). Incentives were nonexistent at the peak of the market but were more than $4,000 per vehicle and 11.1% of the purchase price in 2019.

📊 Stat of the Day

💰️ Deal Alert: Today’s Top Deals

🎙️ Podcast

There is a lot of talk about living to 100 and beyond these days. Longevity science is a big business, but along with living longer, we need to ensure our financial security. Also, there have been reports in the news about the potential of months-long blackouts across the nation due to the weather. Can this really happen? Clark tells you what’s really going on with the power grid.‌

☎️ Need Money Help?

The Team Clark Consumer Action Center is a free helpline that can help you navigate your money questions. Call 636-492-5275. Visit clark.com/cac for more information.

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