Deb Fowles at About.com has a pretty good article on the five biggest mistakes to avoid in car-buying, which she says are:

1. Not Knowing How Much Car You Can Really Afford
2. Buying New Versus Used Cars
3. Not Knowing the True Worth of a Rebate Versus a Low Interest Rate on New Cars
4. Choosing a Long-term Loan Versus a Short-term Loan
5. Being Upside Down on Your Existing Car Loan (i.e., owing more on the loan than your car is worth — Ed.)

I’m not sure I agree with Number 2 — I think it depends on facts and circumstances that are beyond the scope of this post. And she missed a big potential mistake, which is not finding out what the dealer paid for the car (if you’re buying new) or what the market is for the used car you are considering if you’re going that route. But I digress.

The biggest mistake is indeed the first one listed, and it’s the one that buyers typically don’t look at very hard (if at all). Even when they try, they are referred to incomplete tools like the Car Payment Calculator at BankRate.com. Don’t get me wrong — an incomplete tool beats no tool, and at least consumers are informed of the general “12%-15%” back-of-napkin threshold for how high a person’s car payments should be as a percentage of their income (that is of NET pay, NOT gross pay).

But there are plenty of people who can’t afford that level of car payment. It may be because they have an extraordinarily high mortgage payment, lots of payments on other debts, or expenses that are out of the ordinary (just a few might include private-school tuition payments, costly children’s activities like sports or music, or extraordinary medical expenses for a handicapped child).

The point is that you don’t know whether you can afford to take on a car loan until you sit down with the numbers — ALL the numbers. CYMnow.com enables you to do just that. After mapping out your current situation, you can copy it to create an alternate scenario that includes the car loan you are considering. BAM! Your answer is there lickety-split. If you conclude that you want the car even if it crimps you a bit financially, you can go through and specifically identify what you’ll have to cut out to be able to stay within your means.

The CYMnow.com subscription fee will pay for itself many times over if you talk yourself out of taking on a loan you shouldn’t commit to (you surely can’t count on the dealer to tell you that you can’t afford it), or if you downsize the debt you take on to a manageable level.

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P.S. It might be useful for readers to know that I went to one of the major car companies with a more primitive version of the CYMnow.com model several years ago in hopes that they might install it on their web site to replace the ridiculously primitive model they had on theirs. They didn’t want to go forward, and I had the distinct impression that the reason was that my early model would have told many of their potential customers that they could not afford the vehicle they were considering. There’s nothing inherently underhanded about that response — It just again shows that no one but you can determine what you can really afford.

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UPDATE: Commenter Cornfed below notes the need to take into account the costs of insurance, licensing, and vehicle personal-property taxes. I didn’t think about those because Ohio doesn’t have a vehicle property tax, license renewal in Ohio is pretty cheap (about the only thing left that is), and our insurance rates are low. People living in states with high vehicle taxes and/or license renewal fees, or drivers who don’t have good safety records, are not going to be that fortunate, and the extra costs of these items with a newly-purchased vehicle (new or used) have to be taken into account when determining affordability. He also notes the importance of needs vs. wants in choosing options and accessories.

Fowles probably would have been better off with a Top 10 instead of a Top 5 list.

That’s an easy question. If it has anything to do with making government bigger and more intrusive, chances are it’s increasing (link requires free registration, and at some point will require a paid subscriptions):

….. an education plan that would increase state aid to schools by $7 billion annually within four years …..

….. A ….. major proposal would increase the state work force by nearly 2,500, including 355 workers who would carry out new policies on civil commitment of sexually violent predators. The governor also proposed creating 166 new environmental and conservation jobs, and create an office specializing in climate change to look at ways to reduce global warming.

….. Dealing just with the state’s spending of its own money, not federal aid, the governor is proposing to increase total state spending 7.8 percent, to $83.6 billion, or about three times the rate of inflation projected for the state.

Spitzer’s plans for reining in Medicaid spending should be seen as an insult to informed New Yorkers:

Spitzer’s First Budget Assails Health Care System

Gov. Eliot Spitzer proposed to radically restructure aid to New York’s sprawling health care industry in his first budget Wednesday, saying that the system props up failing hospitals and too often overlooks patients’ needs, while consuming roughly a third of the state’s budget.

The health care changes were among several ambitious proposals that the new governor outlined in his $120.6 billion budget, which would increase overall spending by 6.3 percent — about double the rate of inflation — and cut $1.2 billion from existing health care programs.

This is from a governor who, while he attorney general, thought it was more important to go after high-publicity intimidation of mutual-fund firms than it was to do something about massive waste, fraud, and abuse in Medicaid (estimated at 40% of all Medicaid spending by the New York Times in a report last year; noted at this previous BizzyBlog post), which in 2005 was costing the state an unfathomable $11,000 per person (NOT family) enrolled. Now that he’s governor, Spitzer appears to be content with continuing to avoid doing anything about that, but is instead directing most of his spending-cap fury at mainstream providers. Zheesh.

New York is already one of the highest-tax states. Not even the Bush tax cuts can help improve the economy of a state so stubbornly dedicated to payroll padding, lack of control, and general spendthriftiness.

Yesterday, I posted on the laughable claim by New York Times publisher Pinch Sulzberger that an online version of his newspaper would continue to be worth paying for because, as reported by Techdirt, the Times is seen as “a trusted ‘curator’ of the news.”

That delusional perception IS funny, but the Times’ application of the delusion in a February 10 editorial that is, I believe included in the February 11 print edition, is sick:

The Build-a-War Workshop

It took far too long, but a report by the Pentagon inspector general has finally confirmed that Defense Secretary Donald Rumsfeld’s do-it-yourself intelligence office cooked up a link between Iraq and Al Qaeda to help justify an unjustifiable war.

The editorial blathers on for another 600-plus words. It’s as if the Bush Administration, in particular Dick Cheney and Undersecretary of Defense for for policy Douglas Feith just made stuff up about a Saddam Hussein-Osama Bin Laden relationship out of whole cloth.

Phooey, as Curt at Flopping Aces shows, by showing a Powerline video replay of an ABC report about the Hussein-Bin Laden from 1999, and by detailing statements by Clinton Administration officials in the late 1990s, and even referring to language in the 1998 indictment of Bin Laden by the Clinton Justice Department.

Read, and watch, the whole thing, and ask yourself first, how divorced from reality Pinch Sulzberger and his newspaper must be to consider themselves “a trusted ‘curator’ of the news,” and second, how miserable you expect NYT shareholders will continue to be in the coming years as Sulzberger’s delusions and embarrassments continue to be exposed for what they are.

From AP via MSNBC:

Honest women return bonds found on beach
Savings papers had been washed out of house by hurricane 2 years before
Updated: 1:08 p.m. ET Feb 1, 2007

PENSACOLA, Fla. – A packet of U.S. savings bonds, washed out of a house destroyed during Hurricane Ivan more than two years ago, has been found and returned to its owner.

Jan Meade and her husband, Timothy, a Fort Walton Beach attorney, received the bonds Tuesday after they were found by two people on the shoreline of East Bay, the Pensacola News Journal reported.

The Meades fled their home just before Ivan struck on Sept. 16, 2004. When they returned the next day, they found the back half of their house had been blown out and almost all of their possessions gone or in ruins. Damage was so severe that the house had to be razed.

“I had been buying a few savings bonds every now and then for some time, and they were in the house,” Meade said. I really didn’t know how to replace them. I just thought they were gone forever.”

Plastic bag found

On Saturday, Trudie Childers and her 75-year-old mother, Claudie Tolbert, spotted a plastic bag as they walked along the beach.

“When I pulled it out, it looked like just one bond wrapped in plastic,” Childers said.

But when she got home, she saw many more and hung them on a clothesline to dry.

When she returned to work Monday, Childers, an employee of Holley-Navarre Water System, checked the water department’s computers to locate Meade. She then called to say she’d found the bonds.

Meade greeted Childers with a hug and tears when she reclaimed the bonds, estimated to be worth about $1,000.