Graduation means new beginnings. For many that means a new place of living, a new job, and a new means of transportation – a must for the new graduate. Buying your first car is a huge investment and there are important factors to consider before signing all the paperwork. Here are some tips to help you save money and make the process of buying a vehicle stress free.
Build Your Credit
Most graduates come out of school with low or no credit history and think that they are unable to qualify for a loan. Although financing can be tricky, this doesn’t mean that you can’t buy a car. Many dealerships have a “First Time Buyer” program or discount available to graduates. Another option is to have a parent co-sign your loan. This will allow you to qualify for a loan that may not have been open and allows you put your name on the loan to start building a credit history.
New or Used?
Many first time buyers ask if it’s better to buy a new or used vehicle. While new cars can be a good purchase for some people, a used car is a great choice for many – especially a graduate. The first main factor to consider is price. A used car is going to be a lot less expensive, which allows for a nicer model car. Insurance rates can also be affected by the age of the car, which means that a used vehicle tends to be less expensive. You can also avoid hidden problems by reviewing the vehicle’s history which will ensure your car won’t have problems in the near future.
Before purchasing your vehicle, make sure that you can afford it. This means that you need to calculate your total monthly cost. The finance manager will be able to provide an estimate for your monthly loan payments, but that’s just a handful of your expenses. Ask your insurance to give you a quote on a vehicle you’re looking to purchase before you buy it. They can provide estimate based on the model and year of the car. Gas prices vary, so consider the current price of gas and your vehicle’s gas efficiency. Make sure to calculate your daily miles to help estimate your monthly fuel cost.
Discounts & Deals
It’s important to do your research. Many dealerships run specials for graduates or those about to graduate. If you’re looking to buy a car during the time you graduate, ask about a “New Graduate” discount and you can save up to $500 on your purchase. Be smart and use your diploma to save you money!