Planning to buy a new car? Check out this helpful tips to get you started with saving for it.
Are you planning to buy a new car? While it may sound difficult to save up enough money to buy a new car, it’s not impossible. All you need is proper planning and perseverance. Trust us, it will all seem worth it in the end once you get behind the wheel. But it definitely takes more than merely cutting expenses to increase savings.
Since it’s a significant investment, it also helps you develop the habit of saving, regardless of whether you want to buy it completely or just put a sizable enough down payment.
Here are 9 saving tips that will help you organise your finances if you're planning to buy a car:
1. Make saving money a habit.
Starting to save money is, no doubt, the first step towards achieving your dream. Every salary day, you need to consistently set aside a certain amount from each paycheck and stick to it. You will be able to calculate how long it will take you to save the desired amount. Along with that, it will be much better if your bank additionally offers the choice of automatically transferring a portion of your paycheck to your savings account.
2. Set up a budget.
One should always maintain a budget and keep a track of their finances, irrespective of the financial goal. Making a monthly, weekly, or daily budget could be a good method to make sure your spending habits don't grow out of control. Spend only on what is necessary. For a while, try budgeting your income; you might be amazed at how much cash you can end up saving in the process.
3. Open a savings account just for your car.
To start a new savings account, get in touch with your bank. The easiest approach to monitoring your progress toward your goal is to open a separate savings account just for your car money. The simplest option is to open a savings account with the same bank where you already have a checking account. Your money will also make a little amount of interest in a savings account, making it a decent choice.
4. Limit your expenses while shopping.
When you spend less on groceries, you can find extra money to add to your savings for a car. Take a grocery list with you. Aim to only buy what you actually need from that list. Avoid purchasing unnecessary items. Maintain focus on your new car, which is the goal. Better still, only bring enough money to cover your necessities, so you don't succumb to temptation and wind up overspending. There will always be expenses that are not actually necessary and can be eliminated if you compile a list of all your outgoing money. Remove them and instead put your additional cash into your savings.
5. Use discount coupons.
If you have any discount coupons, why not use them to save money on groceries and other essentials? Never underestimate the impact of even a small amount of savings. That’s because it makes a significant difference to your overall saving goal when they add up. You can also use the reward points you earn on your credit card.
6. Automate your savings.
If you want to purchase a new car, opening a savings account might not be enough. You must set it up in such a way that you never even consider the money entering your account. The majority of banks offer an auto-debit option whereby they will transfer a predetermined amount from one of your accounts to another without your intervention.
The other option? Save daily with money saving apps like Jar which has the auto-save feature. Here’s how to automate your savings plan. The auto-save feature helps you save daily, starting with just ₹10. Jar also saves the spare change from all your online transactions in Digital Gold - just like a piggy bank. Isn’t that amazing? You can easily download it from here.
But remember to let your savings accumulate and grow for a few months. Avoid dipping into those savings. Then withdraw those funds easily a few weeks before you’re ready to make that big investment.
7. Take a look at short to medium-term investments.
While in no way intended as professional investing advice, if you don't anticipate purchasing a car anytime soon, your funds may be better off with a short-term or medium-term investment. You can greatly multiply your investment by using financial instruments like bonds, stocks, digital gold, and mutual funds. When making an investment, however, you should always proceed with prudence and investigate your options carefully before deciding on an investment option.
8. Cut back on your entertainment and communication expenses.
If you already have an expensive mobile plan, you may want to reconsider whether you actually need it or whether you can choose a cheaper one. You may also want to consider switching to a prepaid plan, especially if you rarely make phone calls. If you have a landline, you might want to consider if you really need it. That's’ because you already have a cell phone and the internet gives you more access to local and global communication.
You may have a cable subscription with several channels you don't actually need if your primary interest is entertainment. A package downgrade may be something you should think about. You could simply need to cancel your cable account altogether if you spend most of your time away from home and seldom ever watch TV.
9. Launch a small business or look for a side hustle.
A brand-new car may not be affordable on your present income. You don't necessarily need to work two full-time jobs, but you might be able to start your own side business or take on some freelance work to increase your income. You can search for used items that you can sell on the internet or in your garage. If you have a laptop and access to the internet at home, you can discover a ton of freelance employment there as well. If you know where to look and are committed to bringing home your new car, there are plenty of earning opportunities available. Whatever the size of your profit from sources other than your main job, it can help you put money aside for a new car.
See? As we said in the beginning, while it may seem hard to save up for your next car, it isn’t really impossible. Incorporate these tips in your life, set a plan in place, and you will see yourself driving that new car sooner than you expected!