Having the Toyota of your dreams is important, but what is more important is having one you can afford. Having a vehicle you love means nothing if you cannot finance the car. However, NerdWallet has your back with these tips for money management. By following these, and knowing the lingo, you can afford the Toyota you deserve.
There are a lot of costs that go into your car, whether they are maintenance related or there to ensure both your and the vehicle’s safety. One of the biggest factors your money gets spent on is, of course, gas. Outside of gas, car owners spend money on maintenance and repairs to ensure the vehicle is working properly. Plus money is spent on registration, fees, and taxes that allow you to legally be able to drive your car, as well as insurance to protect you and your investment.
There is also depreciation, a phenomenon that every car experiences. While you are not paying anything towards depreciation, you do lose money through your car depreciating.
Average Monthly Payment
Every month a car owner makes a payment on their car. In 2022, car payments increased by $85.00 with the standard payment each month being $667.00. Your monthly payment is something you should take into consideration before purchasing a vehicle to ensure you can afford it.
How to Budget
There are ways to budget for your vehicle and perhaps lower the amount of money you spend on it. One way is to constantly keep an eye on gas prices and try to fill up where it is cheaper. You can also wait until closer to empty to fill up, which saves you more than filling up when you have half a tank left. You can also pay for your gas with a credit card that offers the best deals. Next, talk to your insurance provider about potential discounts, like a safe driver or a good student discount for teens and college students. If all else fails, get quotes from other providers for the best deal. Finally, look to see if you can refinance your loan which can bring down your monthly payment.
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How to Calculate Total Cost
NerdWallet has a calculator you can use to calculate how much you spend on your car. You plug in your monthly payment, gas, maintenance and repairs, fees, registration, and taxes, and insurance payment. This can help you budget for your car!
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