At one point in life, we all dreamed of owning and driving our own car. Buying a car is a major financial decision, and one must know things to consider before taking a car loan or making this big purchase.

Benefits of Owning A Car

Owning a car allows you to move from one place to another without any delay. It provides comfort, security, and time flexibility. Buying a car is a lot easier now with different car loans and payment options available in the market.

My Consideration Before Purchasing a Car

Personally, I prefer paying or purchasing items in cash – since I don’t want to be in debt, or be a slave to work just to pay for a car loan or monthly car payments. At this point, I know that I still cannot afford it. When I say, I cannot afford something, it means I cannot pay for it in cash (without touching my emergency fund and other savings).

I already a have a set budget for this goal, and I make sure that I equipped myself with information I need in making this big financial decision.

Sharing my considerations in choosing / purchasing a car:

1. Determining my needs:

What is the main purpose of the car? Do I need a large car for family affairs or a sports car? Where would I drive it – city or rough roads?

Once you decide on the main purpose of the car, you then need to know the car’s safety features, good gas mileage, etc.

Personally, I do not have an immediate need to buy a car since my business doesn’t require me to always go out, and there are times in a month when I fly or travel. I have access to a car when I need to go places which is more economical on my part.

If buying a car would provide more business and financial returns to you, you may then consider taking a car loan.

2. Decide if you are buying a New or Used Car

During the Covid-19 pandemic, a lot of car manufacturers shut down the production of new cars because most people fear contracting the virus when they leave home. When the lockdown ease up, more people decided to get used cars and avoid mass transportation.

Buying a used car is less expensive, however, one may not know the car’s history and machine usage. Buying a new car can give you better payment options and car deals, but is a lot more expensive to finance. It is better to understand your needs and financial capacity to determine which car you want to purchase.

3. Understand your Credit History

Banks use your credit history to determine whether you’ll be likely to make payments on time or not. So your credit card history should be in good standing to be able to negotiate low-interest rates on banks. If you are planning to buy a car in the future, it is better to work on your credit card standing now. Time is essential.

4. Research Car Loan Options and Calculate Car Payments

Banks offer different auto loan packages and rates to clients. Review your options and know which payment plan can work best for your financial capacity.

I found a helpful site that helps calculate your car auto loan payments so you can set a budget and determine your capability to pay. You may also calculate based on your monthly budget and it would show your loan size.

5. Research Dealerships

Ask for friends, family, or colleagues’ recommendations for a good car dealership or salesman with excellent customer service. The car salesman should be able to help you choose the best car for your needs, and assist you in the paperwork. Don’t forget to test drive the car and enjoy the ride.

I hope you find this post helpful.

Share the love! Can’t wait to see you driving your dream car!