How Much Should You Spend on Your First Car?
How much should you spend on your first car? It’s a question with an answer that will vary depending on your wants, needs, and means. We know it can be an overwhelming one too, which is why we’re here to help!
Your first car is an important choice. It’s often bought at a time in your life where money can be tight. So how do you find a choice that balances affordability with value?
What Do You Need?
When it comes to a new car, always consider what you need first. You don’t need a car to be blue, or be a Ford, or otherwise look cool.
Growing too attached to a particular make or model is a common car-buying mistake. It can blind you to better, more affordable options. Unless you’re a collector, buying a car should probably be function over form.
Figure out what features you need in your first car. Assuming you’re young and don’t have an unusually high budget, some questions you may need to ask include:
- What kind of fuel efficiency do I need?
- What are the miles on this car and how long do these models generally last?
- Can this car handle the number of passengers I usually need to travel with?
- Do I need to be able to carry large and/or heavy objects?
- What’s the maximum I can spend?
- How much do I want to spend?
These kinds of questions can help you quickly eliminate car listings that just won’t work for you. Even the nicest looking cars should be ignored if they simply don’t fit your needs and budget.
What Do You Want?
Once you’ve considered the above, now you can start playing around with what remains. There’s nothing wrong with playing favorites among the cars that actually work within your needs and means.
Exactly what features you care about depends on you. There are literally thousands of features with a wide range of impact on price, from extra cup holders to backup cameras. Some features, like autopilot, are basically only available from one company (Tesla) and/or in newer cars.
The more cutting edge the option you’re looking for, the more expensive it’s going to be. When buying a car for the first time, it may be difficult to gauge what features you’ll actually end up caring about. This is when talking to someone with more experience can be a big help.
Consider making a list of the features in your dream car. Then, as we touched on previously, set the maximum you will spend and the maximum you’d like to spend.
From there, you can start looking for the cars in your price range most like what you’re looking for. Unless you’re fairly wealthy, you may have to make some concessions but that’s normal! This process is about slowly whittling down to the car most like what you want while maintaining healthy finances.
So…How Much Should You Spend On Your First Car?
It’s at this point we circle back to the question at hand. How much should you spend? What kind of budget you should aim for?
The problem is there isn’t some definitive number. There are people for whom $4000 is an extremely big expense. Then there are others for whom $40,000 isn’t.
Notably, you won’t necessarily have to pay the entirety of a car’s cost at once. Many new and even used cars can be bought on payment plans, for example. Car payments aren’t free but they can spread out a car’s cost in a more manageable way.
Our company also offers auto loans, which can allow you to purchase your car in full outright and then pay us each month, rather than use a dealer’s plan. These kinds of loans open up your options and can allow you to consider car where payment plans aren’t being offered (or the plans that are aren’t very good).
All of this said, you can still pay too much on a car that is technically in your budget. Watch out for common scam tactics used by unscrupulous dealers and never buy a car without a test drive first.
Despite what you may have heard, mileage doesn’t actually make a great indicator of car health either. A poorly maintained car at 50,000 miles can still be a worse buy than a well-maintained car at 200,000 miles. While you still should keep that number in mind, don’t get too drawn in by good mileage (or necessarily buck at higher numbers).
It may seem like a cop-out but the amount you should spend on your first car is…whatever it’s worth! (Or less, if you can manage.)
We Can Help You Pay!
How much should you spend on your first car? You should spend whatever your budget allows for and only on vehicles actually worth what you’re paying.
One of the biggest obstacles for many first-time car buyers is the fact that buying used often requires you pay in full. Even if you technically can afford a car, losing all that money at once can be a big hit. Luckily, we can help with that!
Whether you’re buying used or just trying to subvert a sketchy payment plan a dealer might be offering, you can instead try Quick Loans America. Contact us today and we can discuss our loan offerings, your needs, and answer any questions you may have!
Auto loans can make buying a car much easier. Many first-time car buyers also use them to simultaneously start building up a good credit score! We can help you learn about all that more at Quick Loans America.