By: Vincent Mortensen
We Americans sure do love our cars. Many of us are thrilled to purchase the next coolest, best, most awesomeist…. car that rolls off the line. Who can blame us? The automobile industry does a great job advertising their product by making them look sleek, sexy, and the key to total happiness. Oh, and if you drive their car, you’ll meet a lot of beautiful women or good-looking men, too.
What’s the problem, then? We tend to spend more money than we should on these transportation treasures. The average car payment in America today is a staggering $475 a month! That’s a good portion of rent or groceries for some families. Below are a few tips and tricks to save money finding the correct car for you while still feeling “sleek and sexy.”
- Purchase an automobile that is three to five years old. Car models are still good-looking and in good shape at this age. On top of that, you’ll save thousands of dollars purchasing gently used over brand new. For example, a 2014 Honda Accord STARTS at $22,000 while a 2010 Honda Accord with 30,000 miles averages around $15,000. That’s a good chunk of change.
- Hold on to your car as long as you can. If you’re currently driving a reliable car that has good gas mileage, keep it until it becomes too costly to fix. Not only does this save the hassle of purchasing a new ride, your insurance will most likely drop as your car gets older.
- Research your purchase before you buy. Consumer Reports is an excellent source to find out which cars were reliable and which were duds in any given year. You could save thousands in repairs, insurance, gas, and overall hassle.
- Make a large down payment. Not everyone can purchase a car with cash, but it helps to put as much down as possible. This lowers the car payment and interest. Only put as much down as you are financially comfortable doing.
- If you’re like me, looking “sleek and sexy” is not an issue. If you are able to purchase a “clunker” car with cash or not own a car at all, save and use that monthly $475 car payment for other things like a down payment on a home or a much needed vacation to the Bahamas. The money really adds up over time.
I’d like to conclude with a quote from financial guru, Dave Ramsey: Today, if you decide to live like no-one else, later, you can LIVE like no-one else.