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5 Ways Buying A New Car Can Affect Your Personal Finances

If you are thinking about buying a new car, your mind is probably fill of questions. Should I buy used or new? A truck or SUV? What is my budget for a new car? Will I need to take out an auto loan? Here are five important financial ideas to consider before deciding to buy a new car.

1. What will I do with My Old Car?

If you are planning on replacing your old car, you can use it to offset the cost of the new car. If your car is still in fair condition, get quotes from different places that buy and sell used cars. If your car is not drivable, find places that buy junk cars.

2. Do I Buy a New or used Car?

This may seem obvious, but whether you buy a new or used car will greatly determine the price of your new vehicle. You will want to decide before buying a new car of what price range you will be able to afford. Decide a minimum and maximum payment you are willing to make for a new car. If your maximum amount that you are willing to spend is below $30,000, you might be better off getting a used car.

5 Ways Buying A New Car Can Affect Your Personal Finances

3. How much will My Car Insurance Cost?

When buying a new car, insurance can be easily looked over at first. The insurance prices of your new car can have a lot of different variables. The first thing you want to consider is the type of car you want to buy. Typically the sporty or more luxurious cars will cost more money for insurance. The newer the car, the more money it will be likely to cost you in insurance as well. The best way to determine what kind of car is best for you and doesn’t exceed your budget, is to get an insurance quote on the particular makes and models of the cars you would be interested in purchasing.

4. What kind of Fuel Economy do I Want?

Most people any more don’t want cars that are gas guzzlers. With the rise in gas prices, most people are looking for a vehicle that can get them the furthest distance with using the least amount of fuel as possible. Typically trucks and SUVs have a poorer fuel economy than a sedan or hatchback car. Some people are even converting to hybrids to try to save money on fuel. If you are looking to spend the least amount of money in gas, then you will want to look for a car that has a high fuel economy.

5. Does the Car I Want need Constant Maintenance?

Car maintenance is unavoidable. At some point or another you are going to have get your oil changed, your tires rotated and balanced, and new brakes put on your car. Car parts wear out over time. The more you drive your car the more wear and tear you put on it. So when you are shopping for a new car make sure you do your research. The last thing you want is a vehicle that is in need of constant maintenance and repair as it will cost you more money in the long run.

The bottom line is that when you are looking to buy a new car, it is a long term investment. You aren’t just buying a car and not spending on it once. Make sure you are considering the fuel economy, the insurance, the cost of maintenance, and whether or not you want to buy new or used. All of these things will affect your personal finances on your new car. Be sure to use these ideas to help you determine what price range and car type are best for you and for your wallet.

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