A new or even a pre-owned vehicle for that matter is not a small investment. Despite that fact, many buyers fail to plan their budget ahead of time when buying their next car.
That said, knowing exactly how much you want to pay will make buying your next vehicle a lot easier, and it will also help avoid any financial problems down the road.
It is definitely important to plan your budget ahead of time if you are planning to lease or finance your next vehicle. You want to know exactly how much you are willing to pay every month, with everything included. You also want to leave yourself some room for maintenance, insurance, gas, and tires.
Moreover, it is important that you know exactly how long you want to lease or finance your vehicle, and exactly how much of a down payment you want to give at signing. The latter will obviously have an impact on your monthly payment, but the length is truly the main variable. It is very easy to considerably lower the monthly payment just by adding a year to the contract.
If you are paying cash, you need to consider taxes, but also delivery fees and transport fees, as well as the air conditioning tax. These add up and make the MSRP you see in dealerships or in advertisements a simple starting point. If your maximum budget is $30,000, for example, you will have to look at vehicles with an MSRP of less than $20,000.
Thank you to Morrey Mazda for their help with this article.