Other than a home, a car is one of the most important financial investments you’ll make. Nothing beats the convenience of having your own transportation, and in certain locations it’s the only way to get around. Many times, your employment options are very limited when you don’t have your own automobile. Regardless of the reason, if owning a car is one of your financial goals, here are some tips which can help you get where you need to go.
- Set your goal. Do you have your heart set on a brand-new car? Maybe the better choice is to consider a gently used pre-owned car instead to start off. Do some research and determine the make, model and year you’re happy with, and set your financial goal. Now you know where you need to go.
- Make the payments. Take a look at your budget and figure out where you can trim some of the fat. If you are going for a car which will have payments, work out how much those payments would be and start putting that amount away in a savings account as if you were already paying for the car. This way, you’ll save a significant amount of money to put toward a down payment or even buy a car outright, and you will see how a car payment impacts your financial life.
- Consider harnessing your credit card. Many credit card companies offer a cashback credit card. If you are using a credit card for purchases you would be making anyway, take the cashback credits and put this toward your car purchase. One word of warning – the closer you get to applying for a loan for your new wheels, limit your credit card application process. Every application counts against your credit score, and could negatively affect qualifying for a loan.
- Remember the incidentals. When considering what you’re going to need to get a car on the road, don’t forget to budget for insurance, registration, upkeep and maintenance and gasoline. Keep all of this in mind as you faithfully save your money. The car payment is not the only expense you will have when buying a car.
If you are determined and diligent, you’ll have the required down payment for your car before you know it. Little sacrifices, such as bringing your lunch to work or passing on seeing a movie with friends will all add up in the long run. The time will pass sooner than you think, and at the end you’ll finally have what you’ve been working toward.
My name is Derek, and I have my Bachelors Degree in Finance from Grand Valley State University. After graduation, I was not able to find a job that fully utilized my degree, but I still had a passion for Finance! So, I decided to focus my passion in the stock market. I studied Cash Flows, Balance Sheets, and Income Statements, put some money into the market and saw a good return on my investment. As satisfying as this was, I still felt that something was missing. I have a passion for Finance, but I also have a passion for people. If you have a willingness to learn, I will continue to teach.