Whether buying or leasing, your car-buying budget will normally be one of your largest monthly expenditures. Budgeting for a new car can be tricky, and should be very seriously considered before purchasing or leasing a new vehicle. There are several factors you should consider when planning your car budget, among them monthly allowance and insurance costs. Learn the process of budgeting for a new car, the difference between purchasing or leasing a vehicle, and how to secure an auto loan with Blue Sky Auto Finance.
How to Create Your Budget
After your rent or mortgage, your car payment will normally be your biggest monthly payment. Experts say that your housing should be approximately 35 percent of your monthly income. So how much does that leave for car payments? That will depend largely on your income. Someone with a larger income will naturally have a larger budget. That being said, you should still be shrewd about your car purchasing choices. Always remember to budget for groceries and utilities before deciding on what kind of car to opt for. Leave money for emergencies and a little bit of living. With a smart view of your monthly allowance, you should still be able to find a good, reliable car well within your car budget.
Buying vs. Leasing
Leasing a car is a solid investment for some who don’t want to make a long term commitment. That could be due to any number of things, such as knowing that you will be not living in a certain place for an extended period of time. However, it is not an investment that will ever yield a return. Once your lease is completed, your involvement with that vehicle is no more. If you have the opportunity and means to purchase a car with the intent on selling it at some point in the future, spending a little more than is necessary may be a wise decision.
This is the part of the equation with the most variables. Everything from your own driving record to the year, make and model of your car must be factored in. If it is a used vehicle, then condition, history and mileage also become part of the equation. Additionally, the crime rate of the city you live in can affect your insurance rate. All in all, insurance costs should be around eight percent of the purchase price of the vehicle, give or take.
Blue Sky Auto Finance
Once you have decided what your car-buying budget is and what kind of car you can safely afford, get in touch with Blue Sky Auto Loans. We offer an easy online loan process for potential car buyers with all sorts of credit history: good, bad or in-between. We work directly with auto dealerships and direct lenders. Our process is fast and easy and can be done from the comfort of your home. Contact us, today!