Expert Tips for Buying a Truck You Can Afford
Revving up for the purchase of a new truck or car is an exciting task, whether you're looking at car-lot-new or driven-before-new. Make sure you're just as happy about your purchase after you've paid for the truck as you are in the days before your purchase. Do this by following some important tips from automobile and financial experts.
Save Up Before You Shop
Ideally, you'll have time to start saving up before you need a new vehicle. When this is the case, plan your budget, so you can set some money aside with each paycheck. It's best to come up with a plan that doesn't require too much sacrifice, and it's also important to have an idea when you want to have the designated amount saved up. If you haven't saved up for a major purchase before, it can be helpful to work with a financial advisor to walk you through the steps to save for a car.
Many financial experts recommend buying a car with cash, if at all possible. If you have a specific amount of money available, you're less likely to spend more than you can afford. You'll also be glad to avoid paying high interest rates. However, it isn't always possible to buy a car outright. If you have to finance, learn as much as you can about car loans and how financing work.
Understand How Financing Can Help or Hurt
When you're ready to calculate how much you can afford to spend on a new car, don't forget to factor in the cost of financing. This means thinking about how much interest you'll end up paying. If you don't understand how interest works, you could end up making payments for several years and pay more than twice as much as the price of the actual car. Pay close attention to the length of the car loan, the rate of interest, and any hidden fees on the purchase contract.
Figure Out What You Can Afford
Some truck buyers head into a dealership without knowing how much they can safely spend on a car. In too many of these situations, both the new buyer and the seller are disappointed when things don't work out. Save yourself from this type of frustrating with four important steps.
- Work out your monthly income. Take a look at a year's worth of previous pay stubs. If you have the same amount coming in regularly, note this at the top of your worksheet. If your income fluctuates, you'll need to take the average of your paychecks.
- Subtract your expenses from your income. Of course, you'll need to add these up. Don't forget to include the amounts you've spent on groceries, clothing, recreation, and savings. After subtracting your expenses from your income, what does the remaining amount look like?
- Factor in auto maintenance, gas, and insurance. In addition to making a monthly car payment, you need to have room in your budget for oil changes, filling the tank, and keeping your auto insurance up-to-date.
- Plug your numbers into a car payment calculator. This tool can help you figure out how much car you can get with the amount of money you're prepared to pay. It's also a good idea to leave a hefty amount of wiggle room in your budget, just in case you have unexpected expenses pop up.
In Canada there are sites to help with getting a car with bad credit, however these steps above can help you successfully negotiate a positive interaction, regardless of what country you are in.
The more you can learn and accomplish before you enter the car dealership, the better off you'll be when you meet a salesperson. Don't forget that sticking to your budget is crucial to long-term satisfaction. Any other option is giving up control of your wallet, and that's a ride you really want to avoid.
- Written by James Hills
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