Buying a car, whether it’s your first or fifth, is always a big investment. This is why it’s important to plan and save instead of jumping right into buying a new car. Fortunately, a PwC forecast shows that there will about 107 million vehicles manufactured globally in 2020, so you’ll have plenty of vehicle options. But before you start looking at vehicles, it’s important to ensure you save up enough money. And to help you save for a new vehicle, we’ve compiled a few simple tips.
First and foremost, it’s important to decide on how much you’re looking to spend on a car. This will help determine how much you need to save. When you have this number, you can figure out how soon you want to save up the money and how much you need to save monthly. Breaking down the expense into smaller amounts makes it seem easier and more attainable. And if money is pretty tight, don’t be afraid to look into used cars. With the average vehicle having three owners throughout its life, there are plenty of used cars that will be more affordable.
One of the easiest ways to save up for anything is to cut out unnecessary costs. Saving up for a car requires plenty of self-control and cutting down on things you don’t really need to be buying. Things like streaming services, clothing, and fast food can all be postponed so you can put that money towards the car. It can even be as simple as making coffee at home instead of stopping at a coffee shop every morning. These little costs really do add up and your money can be saved and put towards your car fund.
It can also be really beneficial to open a separate savings account for the money you want to put towards a car. Once you know how much you have to save, having an account dedicated to your vehicle fund can be a great way to keep track of your progress. This can help you avoid spending the money for non-car purposes. There are even certain types of accounts you could look into that can help increase your fund with interest. Once you open this account, you shouldn’t take any money out of it unless it’s an absolute emergency. It’s an out-of-site-out-of-mind type of idea.
Along with having a separate bank account, setting up an automatic transfer can help you put away money without even really trying. Whether it’s weekly, monthly, or on payday, having money automatically transferred into your vehicle bank account can help your funds add up quickly. And because you won’t even see this money, you won’t really miss it. Starting with even small amounts, like five or ten dollars a week, can be a great way to start saving.
With there being about 12.5 million manufacturing workers in the U.S., there are a wide variety of vehicles, all at different prices, from you to choose from. But no matter your budget, it’s important to have a good chunk of money saved up so you don’t put yourself in debt. Following these simple saving tips will help you have a reasonable sum of money saved up when it’s finally time to make a purchase.
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Dual Income, No Kids launched in the spring of 2006 and is now part of District Media, LLC. With over 10 million visitors and syndication on Google News, District Media delivers high-quality personal finance news and advice. Our 58 blogs inform, empower, educate and entertain the public -- free of charge, with all operating expenses financed by advertising.
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