Spending money on a car for personal use is no joke. There are factors you should consider before signing that contract and purchasing a new car – be it cash or on an installment basis. You should also be fully aware that you just won’t be spending on the car model itself, it requires other essential expenses throughout the period. There’s the insurance, maintenance, gas, and all that.
Careful thinking and planning are needed before making a big decision like this. Here are some questions you should ask yourself before buying a car:
1. Why Do I Need a Car?
Figure out the main purpose of why you are planning to get a car. Is it for your daily commute? For going around the campus? For a bigger space so the whole family can fit in? Or is it just for the luxury? Knowing the purpose will help you decide what features you’ll be needing from a car. In this way, you will feel like you got the most out of your payment and you won’t have regrets.
2. New or Used Car?
It feels so great to own a brand new car, but have you thought of its cost? Also, did you know that a car sharply depreciates in value in the first two years? Before deciding on what car you should buy, know your budget and ability to pay. If you plan for a second-hand car, just be sure to check it out properly to avoid future expenses of replacement parts. You just might end up spending a lot more than you should.
3. How much Can I Afford?
This is the most important question of all. Always face the reality and don’t opt for a car that is way out of your income. There are a lot of cars that are available but are affordable and can meet all your needs. But you should also consider what you’ll be spending on your car for it to be well-maintained – gas, maintenance, carwash, change oil, insurance, and a LOT more!
Huge decisions like this will really come to our life, and what we need is proper knowledge on how to manage our finances. Asking help from Financial Advisors and a Wealth Management Firm will lead you to a better path of financial freedom. Before purchasing anything that causes a huge amount of money and constant expenses, you should be fully aware of your financial standing.