Buying a car is a milestone in everyone's lives and it can be quite a task when unplanned. With fluctuating markets and with strenuous efforts to save, one can fulfil the purchase of a car. Here are a few tips you can refer to while planning to buy.
- Decide the car
The first step towards buying a car is to select the type of car based on our requirements. A small car would be sufficient to drive for official work or college. Whereas, for a family of 4 or 5, a sedan might be apt. Some of us might be wanderlust and for such frequent trips or a bigger family, an SUV would suffice. Next comes the important part; the Economy. Assuming our budget is below 3 lakhs, a used car is apt. For a budget between 3-10 lakhs a basic model of any hatchback car is feasible. If the budget is between 10-20 lakhs, high-end hatchbacks, sedan cars and SUV cars can be purchased. Any amount exceeding 20 lakhs falls under the luxury car budget. There are a lot of additional expenses when it comes to luxury cars and one must be fully aware before venturing into them. The third important factor to consider before buying is to compare a used car and a new car. Both of these types have their merits and demerits. Buying a new or used car depends on the budget and requirements. Used cars are the best for short-term, occasional car usage and if the budget is low. Since cars are depreciating assets, a new car might not be pocket friendly but a used car will attract more maintenance costs. Another way to use a car for a short time is to lease them. Leasing works like renting a car for a small period.
- Analyse the sources of finance
There are numerous ways to fund our vehicles. Borrowing an amount of money from sources such as banks and returning it monthly for a timeline along with extra money as an interest sum. Car loans can be easy to avail provided we maintain a good credit history. Choosing the right plan of loan can save a lot of money. Avoid private money lenders as the interest rate can be high. If we are borrowing money, stick to plans that require down payments. Best loan norms demand 20-25% of the money as a downpayment and the interest rates will turn out to be best suited for your budget. This can save some bucks when the principal is returned. Opting out on loans can use up our savings. An ample amount of savings can void a loan. Based on the budget and requirements we can exploit our savings. Are we sure about not borrowing? Let's try saving our money by creating a budget plan. Keep a track of the timeline, budget and per-month savings and try to stick to the plan. In case both plans do not work out, leases can come to our rescue. Leasing is to pay some amount as rent to use a car for a while. It can be useful if the car is needed for a short span.
- Insurance and Warranty
Buying and maintaining insurance can be very helpful when the car faces any major damage. Moreover, a few insurances cover the regular servicing cost as well. Claiming a warranty at the right time can save a lot of money in case the car has any manufacturing defect.
Keep the car regularly serviced to avoid long-term problems as they can cost a fortune. Buy fuel-efficient vehicles and try to avoid rash driving. Money should be spent on extras only if absolutely essential.
-> Take your time to decide on the car.
-> Take your time to decide on the budget.
-> Take your time to select the mode of finance.
-> Take your time to choose a good loan plan.
-> Take your time to choose the perfect insurance plan.
-> Avoid getting pressurised by car dealers.
-> Take suggestions from peers who have experience in buying a car.
Saving some money on your car is crucial and can be achieved through the tips mentioned in the blog. It can be quite tedious to save money on a depreciating asset and yet planning and determination can help achieve it.
Happy and fun learning!