Strategies to Buy and Finance a Vehicle - Strategy #1

Buying a car is one of the most stressful events in most people's lives.  It's a big purchase that includes not only buying the car but includes a loan, as well. Most people don't think about these two things as independent of the other. Each must be considered for a deal you can live with. Unfortunately, most people end up buying on impulse and later regret it and sometimes can't afford it.

We will explore seven strategies to purchasing your new or new-to-you vechicle. First, we will tackle  what you can affort. Even if you are lucky enough to pay cash for your car, there are many expenses to take into consideration before you buy.

1. Car Payment - Start with your budget or spending plan. If you don't currently have a budget or spending plan, write down all the expenses you have each month and your income. Don't cut emergency and long-term savings from your plan to accommodate your new payment. If you have the time, start putting in savings the amount of your new car payment to test drive your payment. This can also becomes your down payment and car expense fund.
2. Lender - Most credit unions offer preapproval before you go shopping. When you are preapproved, you can concentrate on finding the perfect vehicle at the right price. To find a credit union near you, go to What's In It For Me website and enter your zip code for a list.  They can answer questions about warranties, credit life & disability insurance. Generally, credit unions offer lower loan rates, less expensive warranties and insurances.
3. Insurance - Automobile insurance is priced differently based on make & model, miles driven, driving record and credit history (just one more reason to have a high credit score). If you finance your auto, then you will be required to carry full-coverage which is more expensive.
4. Gas mileage - Depending on your commute and travel requirements, cost of fuel can make or break your budget.
5. Maintenance costs - It seems strange to think about but how much a headlight, oil change and tires cost but these are the things that will also break the budget. For instance, some cars might cost $100 each while others cost $500.

Once you determine what you can afford, you can begin researching the make and model that fits your lifestyle. Strategy #2 will cover how to find the car that's right for you.