Although buying a new car will give you a sense of freedom, it comes with an investment, and it’s important that you know how to budget for it. Staying with your comfort zone will make getting behind the wheel more enjoyable every day. To help you make the best financial decision possible in purchasing a vehicle, keep the following three key rules in mind.

The 3 Budgeting Pillars for Buying a New Car

1. Keep Monthly Payments Affordable

As important as it is to have reliable transportation, you have other bills to pay. If you let your monthly payments exceed 10% of your monthly income, you’ll have more difficulty remaining financially afloat. Also, you’ll be grateful that you kept your monthly payments so low if you lose your job or find yourself with an unexpected large expense. A new car with every single bell and whistle isn’t worth your stability. Used cars are more likely to give you a monthly payment of 10% or less.

2. Aim for a Big Down Payment

Once you own the car, its value drops by 9%, and by the end of the year, it’s down 19%. Putting less than a 20% down payment on a car means that it becomes worth less than what you owe. You’ll have to pay that difference if you sell the car. Besides, a larger down payment means that your monthly payment and interest rate will be lower while your credit score gets higher. A sizeable down payment will be easier to pull off if you shop at a used car dealership.

3. Avoid Long-Term Loans

Your interest rates rise in proportion to the number of years your new car loan is supposed to last. Additionally, your car’s value decreases the longer you own it. Again, don’t pay more for your car than it’s worth. If possible, make a car financing agreement that requires monthly payments for only three years or fewer, but be firm about not exceeding four.

Specializing in certified pre-owned cars, Kia Country of Savannah in Chatham County, GA, will help you uphold these three budgeting pillars while making sure you get a quality used car. They’re proud to have cars that suit every taste and budget. Find out more about how you can get approved for your new car loan by calling (912) 335-4176 or checking out their website.