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How Can I Afford the Car of My Dreams?

Jenna Taubel

Jenna Taubel About The Author

Aug 14, 2018 6:27:00 AM

Life is short, and you understandably want to enjoy life on your own terms. Many people have a dream car that they would like to cruise around in regularly, and they keep their dream of ownership in the back of their mind for years. You could be included in this group of dreamers, or you could take practical steps to make it affordable to own the car that you really want.

Honest-1 Auto CareCourtesy of Honest-1 Auto Care

Adjust Your Budget

Most dream car purchases are at least partially financed with an auto loan, and this means that your budget needs to be able to accommodate that auto loan. A loan payment is calculated using the principal loan balance, the interest rate, and the loan term. You can use an auto loan calculator to adjust the numbers as needed to create a comfortable loan payment, and you also should make sure your credit score is perfect so that you qualify for a great rate. However, many people will also need to adjust their expenses accordingly. For example, you may need to stop getting a morning cup of coffee at the local café to free up extra cash in your budget.

Pay Off Other Debts

Making small changes to your spending habits can free up some cash, but you may also need to make more significant changes to your budget. If you pay off a credit card balance, you may have the extra money available to make the auto loan payment comfortably. Analyze your current debt balances, and determine how much debt you would need to pay off in order to reduce monthly expenses to a manageable level.

Start Saving

Almost anyone can purchase a dream car if they have a large enough down payment. For example, if your dream car costs $60,000, you could make a significant down payment so that you only finance $25,000 on a car loan. This can create very manageable auto loan payments. You can see that having a substantial down payment may be essential if you want to own and drive your dream car, and now is the right time to start saving for a large down payment.

You do not need to land a high-paying job or win the lottery to own and drive your dream car. Each of these tips can help you to work toward your dream. While you may not be able to buy the car tomorrow, you will eventually achieve your dream when you apply these steps to your efforts.

If you’re looking into buying a car, and want some more information, make sure to check out some of these other helpful articles!

We do our best to provide helpful information but we cannot guarantee the accuracy or completeness of the information presented in the article, under no circumstance does the information provided constitute legal advice. You are responsible for independently verifying the information if you intend to use it in any way. Additionally, the content is not intended to be reflective of First Alliance Credit Union’s products or services, for accurate and complete details about our product and service information you must speak to an advisor at First Alliance Credit Union.