Shopping for a new car? With so many options, the choice may seem overwhelming. Here are a couple of questions that can guide you to just the right car for your needs and lifestyle.
Is it affordable?
No matter how much you love a particular car, if paying for it is going to leave you short on cash each month, then you haven’t found your perfect match. Generally, what you shell out for transportation — including car payment, insurance and gas — shouldn’t come to more than 20% of your take-home pay each month after you’ve paid your other bills.
That said, you need to weigh your existing expenses before deciding how much is manageable. Financial institutions such as US Agencies Credit Union can pre-approve you for an auto loan and may reward you for setting up e-statements and automatic payments, for choosing a fuel-efficient model or even just for making your payments on time consistently. You’ll also have the advantage of knowing exactly what you can afford before you shop.
What are your lifestyle considerations?
Once you’ve set your budget, narrow the possibilities by examining your needs:
- Will you be traveling in winter conditions and benefit from all-wheel drive?
- Do you commute long distances, making fuel efficiency a priority?
- Do you often drive passengers and need enough seating for everyone? Would having four doors make life easier? What about room for child seats?
- How much cargo do you carry, and which vehicle types have enough room for your stuff?
- Do you love to work on engines, or do you need something with top reliability ratings?
Credit unions like USAgencies often provide other helpful auto services like GAP and MRC coverage, and debt protection. Some credit unions also partner with organizations that provide car-shopping help.
Choosing a car can be a hassle, but knowing the right questions to ask will put you in the driver’s seat on the way to a new ride.
By Roberta Pescow, NerdWallet