Thursday, 7 May 2015
It's likely that the second most expensive purchase you'll make in your life, after a home, is a car.
While car is synonymous with freedom and a grand American tradition, it's important to have a realistic idea of what you can afford before you are swept away by that new car smell. When deciding how much you can spend on a car payment, keep in mind that experts recommend you budget no more than 10 to 15 percent of your take-home (or net) pay for transportation.
Research the price of the car you want. There are many useful online sites for comparing prices and models. Some of these sites also offer buying tips and advice.
There are also websites to help you determine how much your down payment will be and offer guidance on the value of a trade-in vehicle. Don't forget to take into account how much auto insurance, monthly fuel costs, and regular maintenance will add up to each month.
Once you've determined how much you can afford, explore your financing options.
Auto purchases can be emotionally driven—like that convertible sports car on the showroom floor whispering sweet nothings in your ear—so protect your budget by exploring all of the costs involved before you start shopping. Gathering the facts ahead of time will help you make an informed decision and ensure you get the right car at the best possible price.
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That's a question we often hear when we're shopping. We may automatically default to one choice, so it's easy to forget that not all plastic is the same.
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