GenXJamerican

I should have written this back in February, since I don’t have nearly as many recommended links as I should. Anyway, here are a few notes on my most recent car-buying experience.

What Can I Afford The first thing I had to do was figure out how much I could afford to spend. During my research, I came across a rule of thumb that said you could spend up to 20% of your net income on a monthly car payment. When I found out what that figure was for me, it seemed way too high. So I cut it down to about 12% of my net and moved on to the next step. The other thing I did which proved quite handy later was get pre-approved for a set loan amount. I’m a Costco member, so I went through their auto financing & refinancing service to do this. The end result of this process was a rate of 5.3% on $25,000 over 5 years. Capital One, the company Costco partners with for this service, gives you check and a payment schedule so you can shop for a car as if you’re paying cash.

What Do I Want Deciding what I wanted was the easiest part of the process (since the previous step removed the delusional “I want a Lexus” thoughts). There’s tons of information on the Web when it comes to cars and costs. I found Edmunds.com to be especially helpful. I used Consumer Reports for some of my research too. After settling on the idea of buying a car with at least four doors, my field of choices narrowed to Audi and Volkswagen. For options, the only real must-haves were leather seats and a sunroof.

Test Drives I thought pretty hard about buying a certified pre-owned car instead of a new one, so I ended up test driving a number of used Audi A4s and Volkswagen Passats (both with the 1.8 liter turbo engine). In the case of the 2005 Passat, it wasn’t enough engine for that size car. The A4 with quattro was a bit better. The real challenge with the certified pre-owned cars was finding one that was the right price that didn’t have more miles on it than I was comfortable with.

Moving on to new cars, I considered the Audi A3. It’s a nice car, but a bit small. Add too many options and it gets expensive in a hurry. Since my last car was a 2000 Volkswagen Jetta, I thought I’d at least test-drive the new Passat. I wanted a fallback if I couldn’t get a reasonable offer on the A3. The way the Passat handled during the test drive really impressed me. Even with the 2 liter turbo, it’s quite agile. It’s got tons of room inside as well. Given those factors, and the substantially lower cost compared with the A4, I felt comfortable choosing it.

Pricing my trade-in I didn’t want the trade-in of my car to have any impact on the price I was ultimately offered for a new Passat. So I took my Jetta to CarMax to have it appraised. They offered me $5500 for it, probably because of the high mileage (nearly 100k in less than 6 years).

Pricing the new car I used Edmunds.com to get quotes on a Passat from multiple dealers at once. They all offer “special” Internet-only pricing at points during the year. At my friend Sandro’s suggestion, I timed things so that the purchase would happen at the end of February. The hope was that their need to hit sales quotas would make dealers more flexible on price. In the case of the two dealers I seriously considered buying from (Congressional and Antwerpen), it seemed like that did factor into the outcomes. In order to offer me a lower price, both dealers offered to sell demo cars at a lower price.

Closing the deal
One key advantage I had in getting the best price was Sandro’s friend Elmer. He works in auto finance, so he knows the secret numbers and incentives that aren’t going to show up in a Consumer Reports price sheet or an Edmunds.com report. I told him what my best offer from Congressional was and what option package I wanted and he found a car at a friend’s dealership at a price that was a little lower. Once we showed up at Antwerpen to check things out, they offered a demo model at a lower price. The mileage was much lower than they thought, so I chose to buy there instead of trekking back to Congressional. This is where my second advantage came in. While I was doing some of the paperwork, Sandro remembered that I was supposed to get owner loyalty credit since I’d bought a Volkwagen before. His memory saved me $500. After a driver from Antwerpen took the Jetta for a test-drive, they matched the CarMax appraisal for trade-in value. In retrospect, my mistake was telling them how much CarMax had offered. I’d kept the car in good enough condition that their driver commented on it. Telling them the appraisal value probably cost me $500-$600. When it came time to deal with financing, this is where my Costco exercise paid off. Volkswagen Credit initially offered a 5.9% interest rate on the car, quite a bit higher than what Capital One had offered. So I mentioned that I’d gotten pre-approved for a better rate and their 5.9% turned into 5.3% in a matter of seconds :-)

The end result I paid $25,500 for a car with an MSRP of $28,430. They also threw in a 2GB iPod nano as part of the promotion they were running that month.

Summary of Recommendations

• Find out what you can afford first.
• Get pre-approved for the amount you're willing to spend. This gives you an alternative to dealer financing.
• Get your trade-in appraised. CarMax is a nice option because their appraisals are good for 7 days and 300 miles. In any case, it's an alternative to a dealer appraising it (since they have a vested interest in appraising it at lower than true value). Don't reveal the appraisal value unless the dealer's offer is lower.
• Have two different cars you're willing to buy.
• Consider buying a demo car. They'll have far less mileage than a certified pre-owned car, but will still have a price advantage over a brand-new car. You may even get a car with more features.

Lockheed Martin’s deal to buy Aspen Systems was finalized back in February, but until this week, the change hadn’t really manifested itself in a noticeable way. My colleagues and I have had more reports to write (since our bosses have had more reports to write), but not much else had changed until this week.

Yesterday we got an e-mail that our Aspen security badges were being replaced with Lockheed ones. The old ones will be deactivated April 1. Today we got an e-mail about company corporate cards we’ll be required to use for business expenses from now on. Bit by bit, the Aspen name and logo are disappearing from everything. Yesterday, they replaced it on the intranet. Today, the public website has the Lockheed Martin star on it (even though the title text still says Aspen Systems Corporation).

As I write this, there’s a crane outside the building removing the Aspen Systems sign from the side of the building (the sign said “pen Systems” the last time I checked since they’d only gotten 2 letters off).

I’m still waiting for more useful things to change, like intranet access, and software licenses for better tools.

Today is my 32nd birthday. To me, it doesn’t seem like a particularly special birthday. It isn’t like turning 13, when you’re finally a teenager, or 16 when you can drive, or 18 when you’re officially an adult. I remember being excited about turning 18 because I was finally old enough to vote. I don’t drink, but 21 was still a good birthday. People talk about turning 25 as a milestone, but I feel 24 was a bigger year for me because I bought my townhouse that year.

Looking back over the past year, I see a lot of changes. I finally got my MBA after 3 years of working full-time and school nearly full-time. I made my first career change by leaving a full-time programming role and moving into project management. Looking forward, I see the potential for more change. The Lockheed-Martin buyout could change things completely. I might start a business of my own this year, or get out of project management and into something else, like business development or strategy.

The entire list is here. It includes how much he gave and when.

Improve My Health

• Exercise 3 times a week
• Cook 3 times a week

Maintain My Hobbies

• Shoot 36 film and/or digital exposures a week.
• Post 3 shots on the photoblog each week.
• Start re-learning the piano.
• Go skiing once more (or snowboarding twice) this winter.

Strengthen My Faith

• Read the Bible every day
• Pray every day
• Help out with a church activity once a month

Improve My Career

• Work on a business plan once a week.
• Learn Ruby
• Attend one technology conference this year.
• Attend one business conference this year.
• Write a technical blog post once a week.
• Contact a different person in my network once a week.

I admit it–I’m a C-SPAN junkie. The purpose of the open phones topic this morning was to air people’s opinions on how the Clinton presidency should be taught in middle and high school history classes. As is usually the case with these shows, the callers didn’t so much answer the question posed as bash George W. Bush or Bill Clinton. The calls I found the strangest were the ones that blamed Clinton for the current Bush years and for how divided the country currently is. Those opinions aside, my own is this: teach Clinton’s successes and his failures–all of them.

I voted for Clinton both times. Despite that, I don’t consider him the best president ever, or even a great president–merely a good one. In the success column: NAFTA, welfare reform, the economy. Perot said plenty on the “giant sucking sound” of jobs leaving the U.S., and that’s true. But that has as much to do with companies not doing what was necessary to modernize as it does with lowering tariffs. I remember being disappointed that Clinton signed the welfare reform bill, but in retrospect, it did get a lot of people off the welfare rolls. Clinton should get credit for mostly staying out of the way as the economy recovered from downturn under the first Bush. He should also get credit for increasing taxes on the highest earners in this country. That contributed a lot to the government going from deficit to surplus. I would count Clinton’s actions on Bosnia as a success too, if only because he helped get NATO involved in stopping the slaughter of Muslims there.

In the failure column: healthcare reform, Rwanda, impeachment. The failure of healthcare reform is perhaps the one with the most consequences for the present day. The voices who said there was no healthcare crisis when Clinton was trying to get this passed are probably the same ones who passed the narrow, expensive and poorly-planned prescription drug benefit. While Clinton isn’t the only one to blame for the genocide in Rwanda (the whole world stood by on that one), as the leader of the greatest military power in the world, his government’s inaction was very disappointing. Impeachment ranks as the worst of his failures from an opportunity cost perspective, not just the moral one. A lot of time was wasted that could have been spent doing far more useful things (like chasing al-Qaeda for example). It allowed people to question his motives for trying to do what was ultimately the right thing.

This article from the NY Times (free subscription required) tells us that those of us who use Google will soon have to contend with graphical ads. I suppose it was only a matter of time, but I’m still disappointed by the news. There are areas when simpler is better, and search is definitely one of them. We can only hope they’ll be small and tasteful (or that CustomizeGoogle will still allow us to remove them).