How to save for a car- 5 great tips to efficiently save for your new car

Saving for a car is not an easy task or financial target as buying a car is one of the financial expenditures that consume a lot of financial resources. Despite being a huge investment depending on the type of car you need or want, buying a car for personal use is a significant financial investment. There are several factors which are considered when making the decision on saving for your car and also the one to purchase with the saved-up amount. In a country with unstable economic policy, you may need to save more than other people residing in other countries as a result of the value of one’s country currency. It is totally true to note that note everyone will be able to save up or afford buying a car. However, many still strive to get one as owing a car is one of the necessities some people of certain professions and lifestyle desires.

The questions in your mind right now as a prospective and hopeful car owner is how can you buy and save up for a car? How can you buy a car without breaking your bank or going bankrupt? Take note of some important and solid tips below

1. Know what type of car you need

There is a big difference between the type of car you need and the type of car you want as we humans desire some form of luxurious things and objects which may be able to afford at the moment due to the financial stand. Knowing your priorities concerning your lifestyle will help you set your needs and wants list. A good example is that a black car with high safety rating and review will be useful and needed than a white car with hatchback which may not be important.

Differentiating and setting up your priorities will help you in saving money while trying to purchase a new car. The car you are trying to buy and save for sometimes maybe a foreign or locally used one. Knowing your priorities will help you become more financially efficient and set your opportunity costs.

 2. Put your financial situation into consideration with a working budget

It’s very true that cars are expensive and getting one will consume a large amount of money. Before buying a car, it’s necessary and extremely important that you put your financial situation into consideration. Walking into an automobile shop for the first time might get you walking out stylishly if you are ready financially.

Despite the huge financially resources needed to buy a car, what you might require is a working budget and not necessary breaking the bank to achieve your car goals. Having car budget will prevent you from spending above and over your financial limit and estimation. Always make your budget based on your financial inflows and outflows to determine the amount of money you can categorically save up for car in one to three years.

For instance, is saving up $1000 dollar every month for the next two to three years feasible for you? Can you conveniently save more than regular savings giving your financial target for your car a lesser time frame?

Always think through and use make you work in line with your budget to avoid wishful and unfeasible thinking in the long run.

3. Note the additional car expenses

When buying a car, the initial cost you pay in exchange for the car is the initial purchase price. For instance, if a car costs $30,000, that is the initial purchase price. Having a car comes with additional cost and expenses such as maintenance and fuel expenses. You may have to insure and pay insurance cost (premium) for your car as well.

These costs are most high and should be put into consideration when buying a car. When buying a car, one should go for the one with low maintenance cost to make your financial status strong and prevent you from breaking the bank regularly.

4. Compare car prices

Before deciding on the amount to be saved and price of a car, you should consider window shopping by visiting different car shop and obtaining the car prices for comparison. This information will help you setting the price range and provide you with good bargaining power when you are ready to make your car purchase.

5. Automate your savings

After making a decision on the type of car to buy based on your financial ability and needs, there is need to estimate the amount needed and determine how to obtain the needed financial resources for car purchase.

One of the very best to start this process is to automate your saving plan to avoid and prevent you from withdrawing due to incessant impulse buying and unnecessary spending that might affect your car savings.

Immediately you have achieved the financial goal for your car, you should try and negotiate the price of the car before making payment. Although, some sellers don’t like when you haggle price but it’s not a bad idea to try it out.   

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1 Comments

  1. Great tips -- buying a car (especially for the first time) is quite a big step so it's always good to be prepared.

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