Buying your first car is a huge step toward financial independence and is an accomplishment to celebrate! But first, many factors go into finding the perfect car. If you’re wondering where to start, here are four things to consider when shopping for your new ride.
Create your budget.
Determine how much you can spend on your car to help you narrow down the options. Next, you need to budget for ongoing expenses and maintenance like gas, oil changes, tires, and insurance.
Determine the purpose.
It’s important to consider what you’ll be using the car for, not just now but in the long term. Will you be using this car to drive to work? If so, you may want a fuel-efficient vehicle. If you have a large family, you may want a car with more room. You will also need to think about what car best fits where you live, such as driving in winter weather.
Do the research.
Once you’ve figured out your budget and what you’re looking for in a car, it’s essential to research vehicles that meet your needs. That means looking up safety ratings, cars with the features and size you’re looking for, and cars available in your area. You’ll also want to research insurance options and become familiar with coverage types, deductibles, and procedures in the event of an accident.
Make a savings plan.
Now that you’ve determined what type of car you want, it’s time to implement a savings plan! Consider the price of cars similar to the one you want and factor in taxes, a title, and a tag into the total. You will also need to save for a down payment on your new car. The bigger the down payment, the less interest you’ll have to pay in the long run. Open a new savings account specifically to help you meet your goal of saving for a car and keep your funds all in one place. Be sure to save 10-20 percent more than your estimated car cost to ensure you have some extra cash on hand in case of an emergency.