The most important part of buying a car is knowing your budget and sticking to it. Your budget isn’t flexible because your bills aren’t flexible. Play it safe and include the cost of repairs, gas, maintenance, and insurance into your budget.
(PRWEB) March 19, 2013
As the cost of living continues to rise, owning a car gets even more expensive for consumers. Between car insurance to repairs and maintenance to the actual car payment itself, the costs add up quickly and can easily overwhelm the average American. However, Carla Cargle, a financial advisor, wants Americans to know that owning a car is not out of reach.
“Owning a car doesn’t have to be an impossible goal. There are simple, easy steps that you can take to make it within your price range and budget. If owning a car is important to you, then set that goal and focus on the steps you need to achieve it. True wealth is obtained and sustained through your ability to positively relate to your money and effectively utilize it as a building tool,” says Cargle.
Cargle recommends that consumers sit down and figure out how much they can spend each month on a car. Then research and get an estimate for how much annual maintenance, insurance, gas and repairs would cost for a few cars they are interested in purchasing. After those expenses are factored in, the remaining amount left in the budget can be used for the actual monthly car payment.
“The most important part of buying a car is knowing your budget and sticking to it. Your budget isn’t flexible because your bills aren’t flexible. Play it safe and include the cost of repairs, gas, maintenance, and insurance into your budget. If you need it, it’s there and if you don’t, let it accumulate for possible emergency expenses in the future,” says Cargle.
Cargle encourages consumers to start saving for a car at least a year in advance of purchasing. Setting aside money each month will allow consumers to build up a savings that they can then use towards a down payment or a rainy day car fund.
“I can’t emphasize enough the importance of saving in making car ownership more affordable. Putting a down payment on your car will reduce the overall cost to you. Not only will you pay less each month, but you’ll be paying less in interest over the term,” says Cargle. She does not recommend paying cash for a car or significantly depleting your savings for the purchase. Cargle gives the example, if you have $25,000 in your savings and spend $20,000 to pay cash for a car that is unwise. You should maintain at least 3 – 6 months of your monthly expenses in an emergency savings account.
Owning a car is a symbol of independence and it shouldn’t have to break the bank. By sticking to Cargle’s guidelines, consumers can purchase a car without going into significant debt.
“Remember the purpose of a car is to get you from point A to point B. You don’t have to have the latest and greatest out there. Learn that wealth is not defined by the “things” that you possess and you’ll be better off,” says Cargle.