A car is mandatory to run errands, commute to work or school, and enjoy recreational, educational, and entertainment activities. Conversely, a car is a money-draining vehicle that requires auto repair checkups, car insurance coverage, fuel, and monthly payments. To enjoy the benefits of a car without the financial strain, save smart.
Save More than the Car Price Tag
Aim to save for the car price, but believing the car price is the only expense is not accurate. As mentioned before, the car requires money for fuel at the gas station, auto repair checkups, and car insurance. The dealership requires monthly payments and interest rate fees before ownership transfers to you permanently. Additional payments include property taxes, sales taxes, car tags, car title, parking fees, car washes, and down payment funds.
The bulk of the cash will go toward the car purchase, so it’s important to know whether you’re aiming for a brand-new car or a used car (a.k.a. pre owned cars). A used car is less expensive while a brand-new car requires less maintenance for its first three years. It’s helpful to know the car build (sedan, SUV, crossover, etc.), its size, and the car’s purpose too (errands, work, travel, etc.). Furthermore, car features and perks are splurge expenses, so choose the features you will use frequently.
Open up a savings account and dedicate it to a car purchase. This keeps the money separate from the rest of the income. Transfer money in the account per week or per month manually or automatically. One way to build the bank at an accelerated pace is by selling unwanted items online. Second, add piggy bank and pocket change to the account. Third, discover your old car’s trade-in value and trade it in for cash. Fourth, cashback websites and apps offer cashback rewards while shopping. Last, take on legitimate side jobs and work-at-home jobs that are enjoyable or simple to do. Send every dollar and cent into the dedicated savings account.
Cut Out Expenses
The hardest part of saving is reducing or eliminating luxuries we enjoy. Examples are cable and streaming subscriptions, dine-in restaurants, massages, beauty shops, nail salons, and gym memberships. Reduce or find cheaper alternatives to necessary items like utility bills, phone bills, and grocery items. Additionally, pay off or reduce outstanding debts like student loans, mortgage payments, medical bills, and credit card bills. Splurge occasionally as a reward for saving, but overdoing it will create setbacks.
A car is a costly expense that’s worth the money. However, don’t go broke attempting to purchase one. Get finances in order and research to find the best affordable car now to avoid hassle and regrets later.