Ever since I was a kid I was brought up to be frugal and to save and budget money. * Disclaimer: I am not a financial planner.
If you're already planning on purchasing a new vehicle, here are some steps you can take to save money when buying one:
Save for a down payment.
Save for a down payment.
The amount of time it takes to save for a down payment depends on your income and how much you're willing to contribute each month. Start by creating a budget that includes the cost of insurance, gas, maintenance and other costs associated with owning a car (such as parking). Then, subtract this amount from your monthly take-home pay. Once you've reached that number—or saved enough money—it's time to start looking into financing options!
Check your credit score.
Before you go car shopping, it's important to check your credit score. This will help you understand how lenders view your ability to pay back a loan and what kind of interest rate they might offer you.
There are several free websites that allow consumers to get their credit scores for free, including CreditSesame, Credit Karma and Experian (also known as FreeCreditScore). You can also request a copy of your TransUnion or Equifax credit report from AnnualCreditReport.com.
See how much you can afford.
To figure out how much you can afford to pay on a car, you first have to determine the amount that you can comfortably pay each month and then add up all of those numbers.
To get started, take a look at what kind of vehicle you want to buy and how much that vehicle costs. Then, visit Edmunds' Loan Calculator (https://www.edmunds.com/car-loans/loan-calculator) or Bankrate's Payment Calculator (http://www.bankrate.com/calculators/auto/auto_payment_calculator1/) if you need help figuring out how much each payment would be based on your estimates. Both calculators will tell you what kinds of monthly payments are reasonable for different types of cars so that it doesn't become too difficult for yourself later on when picking out what kind of monthly payment makes sense for your budgeting needs!
Do some legwork to find the car you want.
In order to save money on a car, you'll need to do some legwork. And by that I mean:
- Looking at the classifieds for cars that are in your price range and that have the features you're looking for.
- Visiting used car lots (ask friends and family if they know of any good ones).
- Asking friends and family if they know anyone who is selling a car.
Negotiate as you would when buying any other car.
When buying a new car, you want to negotiate the price of the car. When buying a used car, you want to negotiate the price of the car and all of its extras. That's how it works in every industry: when something is being sold at an agreed-upon price, it's called "negotiating". The only difference between buying a new and used car is that when you're negotiating for a used one, there are extra things for you to negotiate about!
You'll also want to negotiate with yourself about whether or not this is actually happening...
Drive off with a smile on your face.
When you're happy with your purchase and the savings you've made, you can drive off with a smile on your face.
- Be happy with your new car.
- Be happy with the new car insurance (if applicable).
learn to save money on a car
If you've been waiting to buy a car because you couldn't afford one, now's the time to stop thinking of it as an expensive purchase and start treating it like something you can actually pay for. The first step is figuring out how much money you need to save in order to make a down payment on your next vehicle. Research how much interest rates on used cars are currently running and consider how soon after purchasing your first car that you'll want another one. If there's a long period of time between the two purchases, then maybe going with something cheap makes sense; otherwise, consider buying something nicer so that when the time comes for number two (or three or four), there will be more equity in what is essentially still just one vehicle!
The next step is researching whether or not any dealerships near where I live have any decent deals going on right now (which brings us back around full circle). This can take some effort but if done properly it could end up saving quite a bit of money over what would otherwise be spent by someone else who doesn't know about these deals ahead of time."
We hope you find these tips helpful for saving money on a car. As we mentioned earlier, the best way to save money is by planning before you buy. Once you have your budget and credit score figured out, it's time to look for cars that meet those demands. The next step is finding out what other people pay for similar vehicles in your area—which might mean asking friends or family members who are willing to help out! Finally, be sure not forget about negotiating when visiting dealerships so they'll give you the best deal possible on any new ride
This article is accurate and true to the best of the author’s knowledge. Content is for informational or entertainment purposes only and does not substitute for personal counsel or professional advice in business, financial, legal, or technical matters.
© 2022 Shanon Sandquist