When should you buy a used car?

Tuesday January 26th, 2021

When should you buy a used car?

Most will financial experts would recommend buying used vehicles around the two-year mark.

By buying pre-owned you wind up saving 40%, you can still get a nice car and cut your payments in half. If you manage to catch a Labor Day deal, you get to save even more – see Edmunds, KBB, Find the Best Car PriceA simple way to guide you in buying your car is this:

As a general rule of thumb, your car should never cost more than half of your net annual income!

For example, if you take home $40,000 a year a vehicle that costs $20,000 is way too expensive.

Other items to consider when buying a car are the cost associated with:

  • Maintenance costs,
  • Annual fuel expenses,
  • Insurance costs, and
  • Personal property taxes.

Sometimes a car payment is, in fact, manageable. However, when coupled with all the other associated expenses, it can become unmanageable and impact your savings rate!

Final Take:

Every time I see this on Facebook I want to scream,

Just purchased my dream car, hard work really does pay off!”

Or in my case, I simply said “New Whip,” which as you can see in the photo below that I posted on October 3rd, 2014…

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