Buying a car is one of the major financial commitments you will make during your life. The car you choose will be determined by a lot of factors, particularly your budget. With other expenses to be made and possibly a family to cater for, buying a car also comes with its financial impact. This means that your overall expenditure will invariably increase. So, before you buy a car, pick the perfect one that will fit your budget.

Working out the budget

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Your budget is the primary determining factor when purchasing a vehicle. Whether you can afford a new one outright or you need used car finance deals, you have to be realistic about your budget. Spending above your means will only derail your financial status and may lead to unwelcome debt in the future. With a simple budget planner, take your time to work out the amount of money you can afford to spend on a car. This involves assessing your current monthly income(s), monthly expenditures, savings, and investment portfolios. After these calculations, you should have a fair idea of what you can afford.

Work out car expenses

After knowing how much you can afford to spend purchasing a car, you should also consider the running costs. You have to buy fuel, take it in for servicing, getting insured, and other things. According to the Office for National Statistics, the average UK motorist spends about £1,726.40 per year on running costs. Note that this figure does not include the cost of depreciation. You should also know that vehicles with large engine capacities cost more to run and depreciate faster, hence reducing value if you want to resell. New cars are affected more by depreciation than older cars. So used cars depreciated far less than new cars. New cars are said to lose up to 20% of their resale value once you drive them from the showroom.

Finding the right car

When on a budget, never let your heart rule your head when choosing a car. The best choice is a car that will suit your practical needs. If all you need is a basic car to commute, get one that fits the description. Aesthetics should not be a major concern at this stage. So long as the car is good to go and fully functional, you do not have a problem. If you do not know where to start looking, there are a few resources you can turn to. Some of these resources are car magazines, taking mental notes of cars as they pass by, checking out motoring websites, visiting your local car dealership, or asking for recommendations from friends and family.

Other considerations

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With all this information, you should know how much you can afford to spend on a car. Here are other questions you may need to answer; how practical is your choice? Is it just for the commute? Do you need it for work? Perhaps a truck to carry equipment? How often will you drive it? Can it transport the family? What type of insurance cover are you looking at? How badly will depreciation affect a resell?