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The Post-MBA Guide to Buying a Used CPO Car

So you’ve earned your MBA and now it’s time to start working. Especially if you’re an international MBA, you probably don’t have a car and want to get good value for your dollar. After all, you need to look good, but you have to pay off your student loans too.

That’s what I’m here for: I’ll show you how to buy a certified pre-owned car and get the most bang for your buck.

Why Certified Pre-Owned (CPO)?

Manufacturer CPO vehicles are fairly new (within last 3-4 years) and in very good condition. Manufacturers will add additional warranty on top of what a car may currently have, and because of this, they are incentivized to carefully inspect a car before they certify it in order to end up profiting from the extra fee the customer is charged for this peace of mind. For you the customer, you want peace of mind because you’re going to be working so many hours in your new job, you don’t have time to be worrying if your car is going die out on you as you are stuck in rush hour traffic. Thus, unless you consider yourself a car expert who feels he can rate the internals of a car himself, CPO is a great way to go.

Sound good? Let’s get started.

For more about CPO programs and understanding which manufacturers offer good ones, see this article from Edmunds.

  1. Start with CarGurus. CarGurus can tell you how good the price of a car is relative to the area and similar vehicles. It’s a very good starting point for understanding whether something is a good deal. The only thing where it may lead you astray is if the listing on CarGurus is different from the official dealer listing – for example, CarGurus thinks there are a couple of options that are not in fact, in the car. Just double check. Also double check that the car is in fact manufacturer CPO – dealer listing is the official listing. A used BMW car cannot be sold by a Mazda dealer as CPO. It may be CPO by the individual dealer, but you only want manufacturer-CPO. A BMW manufacturer CPO means that warranty is covered by BMW as a whole and you can go to any BMW dealer for repairs.
  2. Here’s an example search I made for a friend who was looking for Mazda and Subaru crossovers. Here’s a starting link for you to enter in your own information. Remember to select “Dealer” as Seller Type and “Certified” under Condition. All cars that are filtered should be manufacturer-CPO.
  3. Before you begin, filter out (check the box) all the options under Photos in the left column. You do not want to see listings with frame damage or simply don’t have a photo.
  4. You want to focus on the Good and Great Deals. I pay attention to anything $1,500 below Market Value. Depending on urgency and how picky you are in terms of options, you may have to be more amenable to lesser deals.
  5. If you like what the car offers, call the dealer and book a time (ASAP) to see the car. Research the car in advance just so you know what you’re getting in terms of reliability, CPO terms, etc. A test drive really isn’t about seeing if you like the car – it’s pretty hard to judge a car on a 5 mile drive that you will probably drive conservatively. If you see a car you love and it’s a Great Deal, don’t waste time and put it off until a convenient time (weekend, holiday). Odds are it will sell quickly. There’s less dealer foot traffic in the middle of a week, so there’s an advantage.
  6. For the most part, don’t expect to really negotiate unless you have leverage (exact same car within 50 miles, similar miles and options). Most dealers now are on automated pricing in which they have enough inventory in enough areas to understand what they can sell at. The system regulates the pricing.
  7. If the car is listed as a Great Deal, it may already be under dealer cost, so no discount possible – also look up a car under NADAguides to better understand the value of a car. Another thing to look into is the Costco Auto Program. The program guarantees you an easy no-negotiation price for a new or used car. Costco will have partnerships with dealers in your local area. You may not get the absolute best price from Costco, but you will always get a very good price with no work or hassle – Costco is very emphatic about protecting its members from typical dealer BS.
  8. Do check out any student offers (usually a cash rebate from the car manufacturer, not the dealer – it does not affect dealer profits) for new graduates. This may be around $500-$750. You can see a rundown of discounts per manufacturer on CarsDirect.
  9. You’ll need insurance, a copy of your job offer (or pay stubs), and a copy of your MBA degree to finalize the purchase assuming you want financing and the student discount. For F1 Visa MBAs, some car financing units may to offer financing to F1 Visas – check in advance. Toyota does, BMW does not.
  10. You’re more than likely better off not buying any additional insurance / wheels / maintenance coverage. Those are always priced to be profitable (of course). You could negotiate it (there may be tips online) if you want to see how low they can go. Expect the car purchase to take 5 hours if everything goes smoothly – most of that is due to financing.

If you’re wondering, I followed these guidelines myself and purchased a 2013 BMW (F30) 328i sedan for $21,500 in the Spring.

My 2013 BMW 328i F30

More details:

  • Original MSRP: $42,000
  • Purchased with 25,000 miles, and with CPO Warranty, the car had warranty for nearly 3 more years or 75,000 miles at time of purchase. Free maintenance was active for an additional 10 months. For reference, a new BMW has a 4 year / 50,000 mile warranty.
  • $1,500 recent student graduate manufacturer rebate from BMW for CPO vehicles.
  • Price was listed at $22.9K. Before the student rebate, the car was shown as over $3,000 below market value, according to CarGurus.
  • Received 2% financing for 5 years, another BMW promotion.
  • No Costco discount – the salesman said, this is already below our dealer cost.
  • NADAguides listed the CPO pricing for a similar (mileage, condition, etc.) vehicle at $27,075, with the “Clean Trade-In” value, or what a dealer would pay if a customer traded in the car to buy another at, at $22,375. This latter value doesn’t include the cost for the dealer to actually inspect the vehicle, recondition any problem issues (for ex, my floor mats were replaced with new ones), and add warranty onto it.

Reaching 90th Percentile Resting Heart Rate [Fitness with Fitbit]

Resting Heart Rate - Michael Nguyen - 03-29-2016

Resting Heart Rate as of March 29th 2016. Data from Fitbit Surge.

I have been using the Fitbit Surge for the past couple of months after receiving one as a gift from my sister. Overall, the product works reasonably well, but its step counter isn’t so good if you play basketball or do crunches – dribbling with your left hand and doing crunches will increase the step counter, resulting in wildly inaccurate distance and possibly calorie measures.

Regardless, I like the heart rate function, and I assume this is something that can be counted on even if the pedometer is wrong – despite recent lawsuits on Fitbit’s heart rate tracking accuracy, I trust this Consumer Reports article, Taking the Pulse of Fitbit’s Contested Heart Rate Monitors, from January. After the first few weeks, my heart rate went down from 68 to 56, where it has remained so for almost a month.

However, I wanted to know what this actually meant, and how this compared to other people.

Real information on resting heart rate is difficult to find. There are many articles, but few that have actual sourcing (this is true of most food / nutrition articles as well) on why we can trust the information. Thus, I began to look into percentiles, and I found the following data (it would be nice if Fitbit allowed its community to share this information in aggregate for public comparison) from the Canadian government:

Average resting heart rate, by age and sex, household population, Canada, 2009 to 2011

Resting Heart Rate Percentiles

Resting Heart Rate Percentiles – Statistics Canada

From this chart, I am at the 90th percentile (top 10% of all males my age group) in resting heart rate. I am not sure what this all means, but I am guessing that because my heart has to pump less on average, I have a combination of a stronger heart, more efficient lungs, and less excess fat that blood has to pump around.

Currently, I do not work out as much as I would like (my knees really swell up after basketball), but I do the following workouts per week, along with my lower carb diet. Ideally, I would like to add bicycling and swimming (once a week) for lower stress workouts later on.

  1. 2 basketball practice workouts (30 minutes dribbling, 1 hr shooting)
  2. 1 basketball playing session (2.5 hrs on average)
  3. 3 sessions, roughly 500 crunches (60 straight, 110 bicycle alternating x 3)

Another Look at Cholesterol Tests [Health Fallacies]

Having read and written about The Great Cholesterol Myth, it had actually been a while since I had taken a test and could understand my results.

image

When I got this last week, I was of course worried. (H Flags denote issues) I had been on a (lower) carb diet since 2013, and in the process had dropped over 20 pounds. For the most part I do not eat rice, bread, potatoes, or drink soda or beer, though if I am being social or go out to eat, I consume more of all those. During the last year at Kellogg, I have not been the best at working out (during the Fall, I occasionally played basketball and swam, during the winter, I did nothing and broke my finger during basketball, during the Spring, I swam), but I wondered if I was just super stressed out (I feel reasonably fine) or if I was doomed for heart problems down the road. After a restless night, I remembered that the book argued that traditional cholesterol benchmarks were based on faulty research(read the book to see the extensive history of traditional cholesterol tests and disproving research), and I needed to check my findings with the book’s.

If, for example, your triglycerides are 150 mg/dL and your HDL is 50 mg/dL, you have a ratio of 3 (150:50). If your triglycerides are 100 mg/dL and your HDL is 50 mg/dL, you have a ratio of 2 (100:50). This ratio is a far better predictor of heart disease than cholesterol ever was. In one study out of Harvard published in Circulation, a journal published by the American Heart Association, those who had the highest triglyceride-to-HDL ratios had a whopping sixteen times the risk of developing heart disease as those with the lowest ratios.1 If you have a ratio of around 2, you should be happy, indeed, regardless of your cholesterol levels. (A ratio of 5, however, is problematic.)

My Triglycerides : HDL ratio is .84, well below the happy ratio of 2, where the lower ratio is best. WIN!

A cholesterol level of LDL 160 mg/dL or less has been linked to depression, aggression, cerebral hemorrhages, and loss of sex drive.

My LDL is 172. WIN! (The book explains that cholesterol drugs lower LDL, are actually inflammatory drugs, and that memory loss is a side effect of these drugs)

Triglyceride levels higher than 120 mg/dL and HDL levels below normal (less than 40 mg/dL in men and less than 50 mg/dL in women) are usually associated with the small, dense, atherogenic LDL particles you don’t want!

I am both well beyond these levels (Triglycerides is 63 < 120, HDL is 75 > 40). WIN!

Thus, now I can feel a lot better about things. The only thing I wish I had gotten was a LDL particle size test, which was not included in my physical results. If you need help interpreting your results or in better understanding cholesterol’s impact on health, definitely check out The Great Cholesterol Myth or my blog post about 10 Things to Learn from the book!

Driving in Fear in the Midwest Rain

Coming back to Chicago from Cleveland last week, it started raining. At first, this wasn’t anything special as I’ve driven in the rain plenty of times, but then we hit a spot in which it was raining so hard, I lost complete visibility. When the rain first started, I had already slowed down to around 60MPH and kept a distance of over 5 car lengths behind the car in front. We (Ha and I) then hit an area where that car completely disappeared and I could not even see the left (I was in the left-most lane) barrier to the freeway.

This was the scariest time I had ever experienced driving. My heart breaking out, sweat creeping out, I knew I needed to slow down, but I was fearful of the other cars around me. If I couldn’t even see the road or other cars, that would likely mean they couldn’t see me. Thus, it wouldn’t be a good idea to just stop in the middle of the freeway. However, to keep going would risk that I would hit someone else or drive into the barrier. I saw a car in another lane slowing down as I did with its caution blinkers on. I signaled to the right and slowly switched lanes to the right. I wanted to get off the road completely and stop, but I couldn’t even see it. I could only see my neighboring caution car and wanted to go along with him. During this entire time, I was expecting to get hit from behind – it is one thing to see a crash in front of you or have a few seconds of fear. I think this patch of rain was about a minute long, which may sound short, but is intensely terrifying if you are in it. When I finally got to the right most lane and was looking for a way to stop off the road, we passed the rain, and things became more reasonable in terms of visibility.

Since I am from the West Coast, I wonder if this type of rain happens to everyone in the Midwest area from time to time. All the cars involved were very lucky, and I hope no one got hurt. Keep in mind that this was around noontime, during the day. If this had happened at night, I don’t know if there is any way we could have avoided an accident.

How Reggie Miller Cost Me an Autograph from Tim Hardaway (and Junior) [Funny Memories]

“I’m Tim Hardaway of the Miami Heat and blah blah blah…[redacted from memory]”

My sister went to the Warriors game versus the Knicks last week and she mentioned Tim Hardaway’s son, and this brought back my own memories of both son and father.

In the summer of 1995, I was 14 years old, waiting at the San Francisco International (SFO) Airport for my relatives (family of aunt, uncle, and two cousins) to arrive from Indianapolis. As they were my only other relatives in the United States, they were my favorite relatives, and Indianapolis was my adopted second favorite city. In addition, the Colts and Pacers were my second favorite professional sports teams in their respective leagues to the 49ers and Warriors (I stopped supporting the Colts after they fired Ted Marchibroda. Nearly 20 years later, I may be on the verge of ending my support for the 49ers because of their stupidity in letting Jim Harbaugh go. Harbaugh was also Marchibroda’s quarterback with the Colts and the Baltimore Ravens and was replaced with whom I fear to be the next Mike Singletary.)

Continuing the story:

“Hi Tim,” said the man behind the counter on the phone in between moments of talking to customers.

I was five feet away from Tim Hardaway and his three year old (had to look it up) son (the aforementioned Tim Hardaway, Jr.), wearing a Reggie Miller (my first jersey, shown below, still in pristine shape) Pacers jersey. Our family had come to SFO to pick up my cousins’ family and I had worn my jersey proudly to show that I love Indiana (please remember I was 14). And yes, I loved Reggie Miller, the Knick killer as well.

However, there was Tim Hardaway so close to me. I wanted an autograph (in 1995, it was not so common just to have cameras on one’s person) of course – it was Tim Hardaway, former all-star (and soon to be once again, sigh. WARRIORS!) and Run-TMC member who had just been traded from the Warrior a few months prior. But I was shy and of course, had branded Reggie Miller and the Pacers across my body. How could I do this, how ridiculous would it be? Plus, what if Tim was a super jerk or just too busy and rejected me. (By the way, Tim was either trying to rent a car at the time or claiming lost luggage at this moment)

Tim looked at me (I can only imagine what he was thinking), and I shied away. I was too ashamed (not of Reggie, but appearing like a bandwagon fan. Tim was never to know that I LOVE the Warriors and always have) and could not do it.

Today, I have kept my Reggie Miller jersey (another embarrassing note, I used to think I would grow into a size 48 jersey. While part of this was the era of baggy everything, I was clearly very optimistic. I am today 5’6, essentially the same height I was at in 1995, and can wear a size 36. NBA players wear size 48 and above.) Recently, I have also purchased a vintage Tim Hardaway jersey as well as a recent issue Chris Mullin (also of Run-TMC) one, shown below.