Saving money is something we should all do, but when you have a specific goal in mind, saving seems a lot easier to do. When you’re saving money to get yourself your dream car, there are lots of ways to save money. Some ways include starting a small business, asking for a raise at work and investing in the stock market or in a startup company. It’s a good idea to look into multiple ways of saving if you want to reach your goal a little quicker.
1. Get a Loan
One of the fastest ways to get the money you need to get yourself the car of your dreams, is to get a loan. There are plenty of loan companies, like banks and credit cards that can give you the boost you need to fast track the purchase your new car. Lenders like https://loanreviewhq.com/car-loan-calculator/ are a good option for potential car buyers who have little to no credit or bad credit. This option is also a lot faster than loans from traditional banks.
2. Change Your Spending Habits
When you’re saving for something big like a car, it often means making sacrifices. Changing your spending habits can speed up your saving plan. Cutting back on your social budget, going to the movies, dining out, attending sporting events, etc. can really allow you to increase your car savings fund. You can begin clipping coupons and eliminate any frivolous spending. If you have carefully thought out your savings plan, then you can calculate just how many times a month you can enjoy certain things or activities. Yes, sacrifices will undoubtedly need to be made, but you shouldn’t starve yourself of every pleasure. It’s okay to indulge yourself every once in a while, but keep in mind your goal.
3. Take on Odd Jobs
Consider taking a second job if you need or doing a few odd jobs around town. You can walk a few dogs or mow some lawns, maybe even capitalize on a hobby of yours. If you know how to crochet, make jewelry, put together furniture or something else, you can monetize your skill set. A part-time job just might be the thing you need to give you enough wiggle room to put money to the side.
4. Make Regular Payments
Paying a little more than what your student loan, credit card or other expenses require is a common technique in reducing debt, but when you are attempting to save up for the car of your dreams, you may want to consider putting that extra payment into your car fund. And if you are looking to get financing on your dream car, you want to get any delinquent accounts you may have up to speed. This will raise your credit score and allow you to get a better deal and interest rate with the finance company.
5. Have Realistic Expectations
Make sure that the car of your dreams is a good fit for you economically speaking. If it is a gas guzzling machine with 10 miles to a gallon of gas, then driving it will cost you a fortune. If you live in mountains where winter is harsh and long, a sports coupe may not be a realistic vehicle for you. You also want to check with your insurance company about whether or not your insurance rates will change. If the upkeep of the car is going to be astronomical, you may want to reconsider. Otherwise you may find that you have to continue making sacrifices just to be in possession of the fcar.
You also need to be honest about your finances. Carefully assess your finances and how much you need to save, and how long you think it will take to meet your savings goals. This is a crucial step in the savings process, so don’t skip it.
6. Create a Budget
Saving money is a lot easier when you know exactly how much money is coming in and how much money is going out. Without a budget, it is very difficult to make a plan with a clear time frame. You can calculate approximately how long it will take for you to save for a downpayment or the entire cost of the vehicle. When you have a clear time frame, you can count down to the moment with greater certainty, and even if something comes up and sets you back, you’ll be able to adjust more easily and have a clear understanding of where you stand.
A budget helps you manage the possibilities. A budget allows you to set limits and parameters for your daily expenses and monthly expenses. Being aware of your money makes you better able to decide what is feasible and what is not, in terms of spending. If you choose, you can budget the other areas of your spending. Creating a grocery, gas, social, travel, etc. budget will show you how and where you can shift your spending to allow more room for saving.
7. Always Remember Your Goal
When we’re trying to save money it can seem like we’re missing out on some of the fun stuff. One way to fight off that feeling is to remember your goal. Don’t lose sight of your goal, buying your dream car. You want to enjoy your life and experience things, but you have to pick and choose wisely which things you will participate in. It may help to have a picture of the car you’re saving for somewhere in your house, your car or in your wallet. Write notes to yourself to remind you of what your’re working towards and tape them where you need them.
8. Know Exactly How Much You Need
Although it may seem a little difficult because there are a few factors that determine the cost of your dream car, you need to do your best to calculate just how much you need to save. Factors that can make a difference include interest rates, private seller needs and appreciation/depreciation. Do your best here, because saving too little is not what you want. When saving for your dream car you should err on the side of caution, save a little more than you think you need.
9. Make Saving a Priority
Get serious about saving for your dream car and make saving a priority. There are many ways to save, and once you choose your method, stick to it. Make sure to put saving near the top of your list. Don’t put off saving for something fleeting or frivolous. And just because saving is your priority, you don’t have to miss out on some of the things you used to partake in. It just means that you may need to do less of those things in order to save more money more quickly.
10. Don’t Forget Inflation
You want to make sure that you have enough to get your car, so factor in inflation. Depending on the make and model of your dream car, it may be appreciating or increasing in value. So if you’ve budgeted two years to save for you car, calculate the yearly inflation rate and multiply it. Keeping inflation in mind can help you better plan your budget.
11. Set Savings Goals
Savings goals are little milestones that you set to help keep you motivated and adding to your car savings fund. For example, you can decide that you will earn yourself a trip to the movie theater or dinner at an upscale restaurant, maybe even a weekend getaway for every $500 dollars you save. These little incentives make saving a bit more fun and they allow you to keep track of your progress. Rewarding good behavior encourages good behavior.
12. Pick the Right Tools
Perhaps a savings account is enough for you. But there are other options like certificated of deposits or CDs that allows your money to increase at a higher interest rate than your typical savings account. Stocks or mutual funds are great investment tools that can help you save more money faster. Although there is some risk involved, the stock market and other market driven investment options can be very profitable and dramatically reduce the time it may take you to save up enough money to buy your dream car.
13. Know Your Credit Score
If you’re looking to finance your dream car, you should know your credit score. Your credit score is a three digit number between 300 and 850 that is designed to predict your risk of becoming delinquent on your credit obligations. Banks and lenders use your credit score to determine whether or not to loan you money and the amount of interest you’ll pay on the loan you get. Although there are several credit reporting agencies, the FICO score is the one that’s most widely used in the United States.
Your credit score will impact your car buying if you are not paying the entire cost up front. Since a better credit score can mean better interest rates, if your credit score is lower than you’d like it to be, work on raising your credit score while you save. This way, when you’re ready to seek financing you’ll already be positioned to get a better interest rate, saving you money in the long run.
There are several ways to get your credit score. You can go straight to the credit bureaus (Equifax, Experian and TransUnion), you may be able to go through your bank or credit card company, and there are also plenty of websites that offer credit score services.
Regardless of how you choose to save for your dream car, applying any of these tips to your saving strategy just might change the way you handle your finances all around. You can save for the car of your dreams and still enjoy life when you plan it right.
Latest posts by The Fortunate Investor (see all)
- Investment Opportunities That Will Help You To Expand Your Wealth - May 23, 2019
- 5 Trends Shaping the Health Insurance Market - May 19, 2019
- How To Find The Right Financial Advisor For You - May 17, 2019