Owning a car in college can be a great asset, allowing for increased independence and convenience. However, as a student, it can be difficult to afford the cost of a car and the expenses that come with it.
Car prices are expected to drop in 2023, with average November prices in the USA for a new car hovering at $27156, according to estimates by USAToday, a news portal. Media houses like CNBC predict a demand destruction scenario in the car market due to a rise in interest rates and fears of recession.
Let such a scenario not deter you from buying a car, as interest rates for new cars are at 8%, as per the same article. This rate is manageable if you get the right loan and budget properly.
Here Are Five Prime Steps To Buying A Car While Still In College
In this article, we will explore how a college student can own a car while still being financially responsible and making the most of their limited budget. Whether you’re commuting to class or hitting the road for a weekend getaway, we’ll show you how to make car ownership a reality while still being a successful student.
1. Take Out a Car Loan
Taking a car loan can be a great way to finance the purchase of a vehicle, but it’s important to understand the process and consider all factors before applying.
Be sure to compare interest rates, loan terms, and any additional fees or charges before making a decision. We suggest you click here and browse reliable online resources which can guide you as you contemplate a car loan, to finance your first car.
Here are a few key points to check when considering a car loan.
- Credit Score
- Interest Rate
- Down Payment
- Loan Term
- Car Insurance Value
Carefully read the terms and conditions of the loan and make sure you understand all the fees, charges, and other costs before signing the loan agreement. There are more than 500 car insurance companies in the USA, with the average premium for car insurance hovering at $1529, as per Zebra.com’s latest report. There are plenty of options for providers of car insurance.
Budgeting in college is essential to save money for a car loan. Create a budget and stick to it. Keep track of all your expenses, including tuition, housing, food, and entertainment.
You can do this using trending budgeting apps that help you plan your expenses, like Pocketguard, Mint, and others, as recommended by Forbes. The list has been curated after taking into account 18 different factors, with the app store rating having the highest weightage of 35%.
Prioritize your expenses by determining what is essential and what can be cut back. For example, you may need to cut back on eating out or entertainment to save money for a car loan.
By budgeting and being mindful of expenses, you can save money while in college and put it towards a car loan. Remember to prioritize expenses, look for ways to earn extra money, and avoid unnecessary expenses.
3. Monthly Saving Plan
Saving money while in college can be challenging, but it is possible to put away money for a car with a bit of planning and discipline. Establish a savings goal of how much you plan to pay as car loan installments and start saving the required amount every month.
Many businesses offer student discounts and take advantage of them to save money. Shop for deals or buy used items.
Credit card debt can add up quickly and make it harder to save money for a car. Avoid using credit cards unless you can pay off the balance in full each month. Set up an automatic saving plan to transfer a set amount of money from your checking account to a savings account each month.
4. Have a Part-time Job
Working part-time jobs or internships while in college can be a great way to earn extra money and save for a car loan.
Here are a few things to consider when searching for part-time jobs or internships.
- Many colleges and universities offer on-campus jobs that are tailored for students. These jobs often offer flexible schedules and are a great way to earn money while also staying close to campus.
- Be open to different types of jobs, and be flexible with your schedule. This will increase your chances of finding a job that works with your class schedule.
- Ask friends, family, or colleagues if they know of any job or internship opportunities. Word of mouth is a powerful tool for finding a job.
By setting a savings goal, creating a budget, and being mindful of expenses, you can save money while in college and finance a car. Remember to prioritize expenses, look for ways to earn extra money, and avoid unnecessary expenses.