After your residence, your car is the next biggest asset you need in most US cities. This is especially true in a city like Dallas. And if you’ve never bought a car before, having the additional hurdle of your credit can make the process even more stressful. Here’s what you need to know to budget before buying your first car.
Buying a car is a big purchase. You don’t want to overextend your budget with your monthly payments, and you have no way of knowing your car budget without calculating your expenses.
There are several smartphone apps and websites out there that you can use to get a handle on your actual spending to see if your budget is realistic:
- Olivia: The Olivia smart phone app will look at your past spending and recommend a daily “safe spend” to keep you on track with your budget and savings goals. But it’s so popular that there’s a waitlist to download the app.
- Mint: Both an app and a website, Mint can be used to track your spending and expenses every month and organize them into categories so you can see where your money is going. It also provides credit score updates.
If you want to focus on saving a little money before your first car purchase, there are smartphone apps that can help you with that too.
- Digit: Socks away small amounts of money over the course of each month based on your spending
- Acorns: as a micro-investing app, Acorn rounds up each purchase you make to the next dollar amount. So, when you buy a coke for $1.75, 25 cents are sent over to your acorn account to be invested.
At Drive Casa, we understand times can be tough and credit isn’t always perfect. But we don’t think that should stop you from buying your first car when you need it. By getting control of your budget, you’ll be in a much better place to finance a car you feel comfortable with, both physically and financially. Follow us on Facebook for more info on credit and car-buying.
*Disclaimer: Drive Casa is not a financial advising institution; all recommendations are based on opinion.
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