Five things to consider before buying a car
There are a lot of options, in the US, when it comes to buying a car that can help even the tightest of the accounts. However, you shouldn’t make the commitment of having a car without thinking about the expenses that come with it, and that impact directly on personal finances. Some considerations must be acknowledged before taking the final decision of buying one.
It should work for a long time
Perhaps you are dreaming of purchasing a convertible but, it is going to work for many years to come? Think about your plans such as having kids and needing more space or even the weather. Maybe this type of car makes sense in a warmer climate such as California or Florida with more sunny days but if you live in other States where is colder during many months of the year, you can’t justify paying more for the convertible function of it.
Shop second hand
Luckily, there are a lot of car dealerships in the US and it is possible to access second-hand vehicles in excellent conditions. Of course, you must pay attention to how well preserved it is before buying it so any repairs won’t cost as much as a new car.
Public transport works well in your city
Is having a car a whim? Although it could be very practical to have the freedom to move around the city, there are places where it is easier and cheaper to use public transport. You must balance the monthly cost of using public transport against a car, including traffic time and waiting for the bus to come.
Downpayment: the higher, the better
Despite there are tempting offers that only require lower downpayment to access a luxurious car, you must think about what it means in terms of interests and the monthly debt you have to pay to the bank. It is better to save money to pay a bigger downpayment to reduce the monthly cost and to avoid having debt for more years than needed.
Expenses of having a car
Buying a car might be a successful purchase because they can seem cheap, even expensive brands. However, you must take into account all the expenses that come after having the car: maintenance, the price of spare parts (depending on the brand, they can be very expensive), gas, and insurance. These are all expenses that, in some cases, must be taking care of each month. This means that, once you buy a vehicle, you will have less money either to save or to invest.
Often, we believe that we NEED a car or society has made us believe that through ads, comparison among our friends, and even car sellers. However, drowning in a car debt must be only justified if it is needed because of work, the time that saves you or if it is practical for you and your family. You always have to put first your finances within your context, your priorities, and your needs.