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Thursday, September 23, 2021

How to Choose the Right Car

In a perfect world I’d be driving a Porsche Boxster Spyder. Unfortunately if I did own one I’d be living off ramen noodles and living in a cardboard box under a freeway underpass, selling plasma to fill the gas tank. There are dreams and there’s reality.

Finding the right car as a balancing act between the two. You should love your new car, but on the other hand you shouldn’t sacrifice your lifestyle to drive it. Here are a few guidelines to consider when choosing your next vehicle.
  1. Begin by researching car prices, pick 4 or 5 models you like and compare.
  2. Review reliability ratings as discussed in this earlier blog entry, to avoid added maintenance expenses down the road.
  3. Find out the trade-in value of your current vehicle, this amount can be added to your down payment.
  4. Start saving for your down payment, you should put down as much as you can afford, preferably at least 20%.
  5. Calculate monthly payments based on available auto loans, remember you’ll pay less overall if you choose higher monthly payments. Depending on your credit rating you should pay 7% interest or less.
  6. Itemize your monthly bills, rent, credit cars, loan payments, etc.
  7. Subtract the total of your monthly bills from 36% of your gross monthly income, this will give you an estimate of the monthly car payment you can afford.
  8. Factor in additional costs of purchasing or owning a new car, such as taxes, insurance, and registration fees.
  9. Talk to people. Ask people about their experiences with the vehicles you’re interested in.
  10. Test drive. Visit dealerships and try multiple vehicles.

It’s a lot to consider, but in the end buying a vehicle you can afford will improve your car buying experience tenfold. Enjoy a car that suits your lifestyle without sacrificing your lifestyle.

Have you ever purchased a car out of your price range? Or found a less expensive vehicle that turned into your dream car? Please tell us in the comments.