Tons of drivers long to drive a particular car. Perhaps it’s a luxury vehicle to make traveling more comfortable, a spacious SUV to transport your family safely, or simply a specific vehicle you have fallen in love with.
But there’s a fairly good chance that you might need to prolong owning the car of your dreams. Buying a new car is a hefty expense. Beyond the initial purchase price, you will also need to consider other costs like higher auto insurance premiums, fuel costs, and maintenance and repair costs, specifically if your dream car is a substantial upgrade in value from your current car.
Whether your dream car costs too much or you’re looking for ways to afford it sooner, these savings tips can help you.
Create A Monthly Budget And Reduce Expenses
At first, you might feel that it’s impossible to spend less to save more. However, it is sometimes possible to reduce specific areas of your budget.
While creating your budget for all your expenses, you can also determine car affordability. With this, consider all the costs of owning a car, from insurance and maintenance to repairs and financing repayments and interest fees.
Pay Off Credit Cards
If you feel like credit card debt is weighing you down and preventing you from buying your dream car, you could consider paying a bit more towards your credit cards to pay this debt off faster.
Because credit card debt is revolving, you will strengthen your financial stability simply by owning less debt. Once this debt is paid, you can reallocate the credit repayment funds to a savings account for your dream car.
Choose Financing Options With Low-Interest Rates
Choosing a low-interest solution is pretty essential if you need to rely on financing to afford your new car. With this, your monthly repayments will be lower, and the loan term can also be shortened. In-house financing is a low-interest vehicle financing solution also available to drivers with less-than-ideal credit scores.
Keep Car Savings Separate
Even if you opt for in-house financing, you will still need to afford the downpayment. And if selling your car won’t cover this cost, you will need to find other ways. But instead of keeping funds for your auto goals with your life savings, separating these into two different accounts is best.
After that, creating auto-debits to top up your savings account is a practical way to ensure you can’t miss a payment toward your goal.
Consider A Side Hustle
Side hustles come in so many different shapes and forms that there’s no doubt you can create an additional income stream to fill up your savings account. Even though you probably won’t be able to afford your car immediately with a side hustle, you can achieve your savings goals sooner.
When choosing a side hustle, create a list of things you are good at, determine your availability, explore income potential, and then narrow down your options.