One of your main concerns when you decide to purchase a vehicle is your budget. You don’t want to overextend yourself and end up having to pay more money than you have.
When it comes to buying a car, the initial cost of the car is not the only expense you will have to consider.
You also have to make sure you have enough money to pay for the license plates, title registration or transfer, insurance, maintenance, gasoline, and any unexpected repairs.
When you decide you want to buy a new car, what can you do with your old one? You might be thinking to yourself: “can I sell my car online”? The answer is yes, you can.
There are many online sites that will help you sell your vehicle. Do a quick Google search and you will see all your options.
Assess Your Current Finances
Start by adding up all your monthly financial obligations. Subtract the total from your monthly income. A good rule of thumb is not to spend more than 20 percent of your monthly household income on vehicles.
Don’t forget to have some padding in your budget for unexpected expenses. Should you buy a new or used car? Your budget will be the biggest determining factor in your decision.
Make sure you make an informed decision and that you are realistic in your budget assessment to avoid future financial problems.
What Kind of Car Do You Need?
Needing and wanting are two different things, especially if you are on a limited budget. You might want a luxury car with all the bells and whistles, but if you can’t afford such a car, why spend money you don’t have to purchase one?
Ask yourself the following questions to help determine what kind of car you need:
- How many people will be in your car with you?
- Do you have a long commute?
- What kind of safety features are absolutely necessary?
- Do you need the ability to transport large items?
- Manual or automatic transmission?
Don’t let vanity or the desire to be trendy drive your decision. Be practical and only purchase an automobile you can afford.
Lease or Buy?
There are advantages and disadvantages to both leasing and buying. You should weigh the pros and cons of both to help you decide which option is better for you in your specific situation.
If you lease a car, there are options for no money down if you are cash poor. With some lease arrangements, you are able to drive a more expensive car than you might be able to afford if you purchased it.
You should also be aware that most lease agreements have a mileage cap. If you go over in your mileage, you have to pay for your overage at the end of the lease.
This cost can be very high, so you will want to make sure your driving needs do not exceed the mileage maximum on your lease.
What will you do when the lease expires? Will you lease another car? Think and plan ahead to be prepared for what you will do at the end of your lease.
When interest rates are low, purchasing a car might make better financial sense, especially if you put a lot of miles on your car. Make sure you do your research so that you make the best decision.
Take a Test Drive
Before making a purchase, take the car for a test drive. You should not sign any deals before you see how the car runs and if you are comfortable driving it.
Don’t succumb to pressure from either a salesman or the seller of the vehicle. You have every right to check the car out before you spend money on it.
If you are buying a used car, you might want to take it to your trusted mechanic to assess the overall condition. If the seller is not being up-front about past accidents or recent repairs, your mechanic will let you know.
Do Your Research
Whether buying a new or a used car, you should learn all you can about your prospective purchase before signing any contracts.
The Internet is full of valuable sites to help you learn everything you need to know. For instance, you can see how others rate certain cars by reading their reviews. Most people have no problem posting negative opinions online.