Enlist These Steps To Buy The Best Car For Your Budget
When buying your first car, you might spend hours researching different makes, models, dealerships, and even colors of your potential vehicle.
But if you plan to borrow money to buy your first car, it’s just as important to look around at financing options and take the proper legal steps to become a car owner. Taking a big-picture view of how to buy a car will allow you to drive off the lot with your dream first car and your finances intact.
Can A New Car Make An Affordable First Buy
Twenty years ago, you needed a trust fund or generous parents to afford a brand new first car, but low-rate finance schemes with modest monthly payments have brought new cars within the reach of more young drivers.
The most attractive deals for new drivers are usually personal contract purchase deals. These offer low monthly payments because they leave a large chunk of the cars value until the end of the deal. Buyers can make the final payment to own the car, or hand it back with nothing more to pay. Alternatively, if the value of the car at the end of the term is greater than the final payment, the difference can be used as a deposit to start a new deal.
Special offers with low interest rates and manufacturer deposit contributions mean that if you’re shopping for a city car, monthly bills of less than £100 arent uncommon after an initial deposit.
Alternatives To Buying A Car
Leasing a Vehicle
Cant afford a large down payment? You may want to consider a lease. Leasing a car is like renting an apartment. You pay a certain amount each month to use it, but at the end of the agreement the car must be returned to the dealer.
For no down payment and the same monthly payment, drivers can often afford a more expensive car under a lease. On the other hand, with a lease, the car is not yours and you wont get anything for it when its time for a new one. Furthermore, the dealer may limit the number of miles you can travel and require that you take out additional insurance on the car. You may also need a parent to take out the lease for you, as leases are not typically available to people under 18.
Try Out a Temporary Ride
Before owning or leasing you can give ownership a test drive. Alternative modes of transportation include renting a car, joining a car-sharing program and borrowing a ride from your parents or friends.
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Who’s Going To Pay For It
Many teens help pay for their own first car. If teens contribute financially and are involved in the purchasing process, it can offer them a sense of responsibility and make owning that more gratifying. It can also help parents shoulder the financial burden of a getting another car.
On the other hand, some parents want to surprise their teen with a car. Both options are perfectly fine and depend on what’s right for you and your family.
Either way, it’s important to consider these factors when deciding who will pay for the car:
- How does my teen benefit from buying a car?
- How does my teen benefit if I buy the car?
- What role in the decision-making process should my teen have?
- Why might I want my teen to help purchase the car?
- Why might I want to purchase the car without my teen’s help?
- Am I financially able to purchase a car without my teen’s help?
- Has my teen expressed a desire to buy or to help buy a car?
Keep in mind that the cost of a car doesn’t end with its purchase. Before buying a car, you should decide:
- Who will pay for car insurance? Will my teen contribute?
- Who will pay for gas?
- When the car requires maintenance, who will cover the costs?
Answering these questions may take some time. Include your teen in these discussions, especially if he or she is actively involved in the car buying process.
How Do I Know If A Car Is Safe
Most new cars have an official safety rating from an independent organisation called Euro NCAP. Each car gets a star rating out of five, which reflects how well it protects passengers from harm, as well as a more detailed report that you can find on Euro NCAPs website. The rating is based partly on a crash test, but also on the cars ability to prevent accidents from happening in the first place. Newer cars come with technology that can detect danger and take action faster than you might react.
The Euro NCAP star ratings give you a reasonable indication of how safe a car is, but there can be more to it than that. A five-star car from 2020 will probably be safer than a five-star car from 2015. And a five-star luxury 4×4 will probably be safer than a five-star supermini. But above all, the safest car is one with a safe driver – no amount of airbags will change that.
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Choosing The Right First Car
Choosing the right make and model is both the first thing you should do and the last. As weve discussed above, you need to have a budget, which informs which models are available to you.
Yet in order to work out a realistic budget you first need to choose a car as an example. So the best thing to do in your research is to pick a car and then use it as an example that can inform your next choice, and so on. If the insurance on the second car is half that of the first one, you can focus on the second one until you find something better.
Picking a car can be as simple as liking the look of one, but there are a number of important things that are worth considering when you are looking at which model to get – well put aside the financial considerations as those have been discussed above.
The size is an important factor. As a first-time driver youll most likely want a smaller car, as these are typically easier to drive and park and cheaper to fuel. Pick a model with good visibility and itll be easier to get used to seeing where to place it on the road as you get used to driving.
If you do go for a larger car as a first car, it would be a good idea to choose a model with parking sensors and a reversing camera, as these features make it much easier to park. – one of the hardest things to get used to as a new driver.
Budgeting For Your First Car
Of course, buying a first car isnt just a simple case of picking the best car for the job and getting that. It all depends on your budget.
Whats really important to remember is that your budget needs to include everything that comes with running a car as well as the car itself – this is something many people initially forget.
How much to spend on a car
Its a good idea to work out a rough budget for the car, and then start to work out the other costs involved with running a car as you go along. You can then adjust the budget for the car as you see fit.
For example, you might set a budget and find a model you like, then when you check how much it costs to tax and insure it, you realise you cant afford it. If that were the case, you’d then need to lower your budget to account for these running costs.
The main costs to consider are road tax, insurance, likely fuel bills and depreciation . Other factors include prices for consumables such as tyres and servicing costs, though these arent massively variable for the kinds of cars youll usually be able to get as a first car.
Comparing insurance costs
Taxing your car
If it was made between 2001 and 2017, then you can check our guide to car tax rates and cross-reference the cars CO2 figure to find out how much it costs each year.
Calculating fuel costs
Other costs
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Can I Afford A Car Right Now
When youre tempted to buy a car, you might throw all caution to the wind. You might tell yourself that you might have to cut back and tighten the belt here and there. Weve all been there and done that. In some cases, there are unexpected costs that might sneak up on you. Used cars break down more easily because they are older and they have already sustained some wear and tear. In some cases, they dont have an immaculate service history. But even if you buy a brand new car, there are various additional costs to be aware of that you are not spending right now.
What are the hidden costs of owning a vehicle?
Some of the costs of owning a vehicle will be negated by the money you already spend on public transport, but owning a car usually works out more:
What Is A Warranty
A warranty is a car manufacturers promise that theyll fix certain parts of the car if they go wrong in the first few years. It covers the bits that shouldnt wear out, rather than things like tyres and clutch plates that owners should expect to replace every now and again.
Most cars come with a three-year warranty, so if you buy a two-year-old car youll still be covered by the warranty for another year. Some manufacturers give much more than that – Hyundai has a five-year warranty on all its models, while Kia and SsangYong offer seven. That means that if you buy a two-year-old Kia, youll still have five years warranty cover left.
Even if the car you buy from Cazoo is outside its manufacturers warranty, well still provide 90 days of cover for your peace of mind.If youll be using your car for hire and reward , were unable to include the 90-day warranty.
There are lots of used cars to choose from at Cazoo. Simply use the search function to find one you love then buy or finance it online. You can choose to have it delivered to your door, or you can collect it from your nearest Cazoo Customer Centre.
If you buy a petrol or diesel car from us, don’t forget to add a CazooPlan Service Plan. This lets you pay for the next two or three years of servicing at once and protects you from future price rises. You’ll also get a free annual MOT test.
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Put Down As Much As You Can
Just like when you buy a home, when you buy a car, youll want to put money down. This is cash youve saved up that you can put towards the car purchase. It reduces the overall amount of financing youll need. And its a very good idea to have a high down payment whenever possible.
There are a couple of big reasons for this: depreciation and interest costs.
First, lets talk about depreciation. Because cars are subject to lots of wear and tear, they lose their value really quickly.
This is especially true for newer vehicles. For instance, this infographic from Edmunds shows that as soon as you leave the lot, a brand new car loses around nine percent of its original value! After one year, the car will lose about 19 percent of its value, and it will have lost 31 percent of its value after just two years.
Actual depreciation rates vary by make and model. Cars that tend to last longer will hold their value better. But, still, the average car will be worth just 37 percent of what you paid for it at the dealership five years after your purchase.
So what does this mean for a car buyer? It means that you can get yourself into an upside down loan really quickly.
This is not a good financial position to be in. It really restricts your ability to make choices with your car purchase in the future.
Should I Consider Leasing
If you’re into the latest tech and luxury, leasing may be a compelling option. Suppose that a $400 monthly payment is the most you can comfortably afford. If you’re buying, that might get you into a mainstream SUV or sedan but if you’re leasing, you can choose from a variety of luxury models. At the end of the day, of course, you don’t own the car, but you also get to skip the usual maintenance and repairs, paying only for routine procedures such as changing the oil and tires. There’s no objective answer to whether buying or leasing is better, but for those who don’t mind always having a car payment, it’s easy to see why leasing holds appeal.
See Edmunds pricing data
Has Your Car’s Value Changed?
Used car values are constantly changing. Edmunds lets you track your vehicle’s value over time so you can decide when to sell or trade in.
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The #1 Consideration When Buying Your First Car
Before you start looking at makes and models, theres one thing you need to consider first.
Buying your first car is a big and exciting milestone with many considerations. The make and model options, the vehicle specs you need to evaluate, the car-buying tips from well-meaning friends and the various deals popping up in your social feeds Its really a lot to think about.
Luckily, the most important consideration when buying a car will help you narrow those options down. And that is
Our Guide To Buying Your First Car Including Top Tips On Budgeting Choosing The Right Model And Saving On Insurance
Buying a new car is always a big moment in life, but doing it for the first time is particularly special as theres no car quite like your first car. This car will be the one to give you a vast amount of new freedoms and let you perfect your driving knowledge on a solo basis.
Many first-time car buyers are young drivers, but this isnt always the case – regardless of your age, one thing is certain, youll want to find the best first car for the best possible price.
To help with your search, you can also read our guides on the best first cars and best cars for first-time drivers, which cover some of the example models that we recommend here in greater detail.
In this guide well look closer at the buying process rather than recommending a list of cars that weve picked out, although well give some examples of models that could work for you, to help you make your decision. Once youve read this guide you’ll then be ready to make an informed decision about which car is right for you.
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How To Watch Cristiano Ronaldo Matches For Al
There are currently no authorised broadcasters for the Saudi Pro League in India. As a result, Indian fans won’t be able to watch the Saudi Pro League on Indian television. However, in India, live streaming will be accessible. You have to use the OTT service Shahid – MBC in order to watch the league in real time. Presently, the platform does not offer any free subscription. You need to spend around 1,160 for the VIP Sports subscription plan in order to watch the games.
Al-Nassr’s official YouTube channel, as well as their social media profiles on Twitter and Facebook, will post highlights of their games.
How To Decide On A Car
Budgeting for a car can be confusing for first-time buyers, as there are multiple different expenses to consider. If you can afford to purchase a car upfront, youll save on a significant amount of interest and might secure an additional discount. However, most customers require some level of financing to make the purchase more affordable. To set a car budget, evaluate how much you spend on other necessities, such as rent, groceries, and insurance, and see what remains. The remainder of your budget could be put towards car-related expenses, including costs like car insurance and fuel.
Before financing your vehicle, determine how much you can afford to spend on the down-payment and monthly payments. If you opt for a larger down payment, then your monthly payments will be smaller, and vice versa. Setting a realistic budget is key purchasing a car thats outside your means could lengthen your loan and accrue more interest over time. Try using an online tool to help you determine a realistic budget.
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