Buying your first car is an exhilarating experience because it is your first step towards becoming independent. Most Canadian teens have it on their wishlist as soon as they start working. But hasty decisions can land you in a financial fix sooner or later. You need to have a money plan in place before going ahead with this major purchase. Unless you have a viable one, you may end up being more stressed than happy. Here are the money facts you should know before buying your first car as a teenager.
Set your budget
Before anything else, you must figure out your budget for the expense. Buy only when you can afford it, which is most likely to happen if you have stable part-time employment that yields regular income. Your budget should also consider the amount you can pay upfront. If you have some savings, you may get a head start with the purchase. But your regular earning should be enough to take care of the recurring payments.
Choose the car wisely
Once you have a budget to start, you can go ahead and choose a car wisely. A budget always keeps you on the right track and saves you from spending on luxury. When you are young, it makes sense to stick to needs rather than wants. Look for a model and make that fits within your budget. You can opt for a reliable vehicle with minimalistic features to save your dollars significantly.
Understand the lifetime cost
First-time buyers often end up making wrong decisions by considering only the car value. You must understand the lifetime cost of the vehicle. A car may seem like an attractive option in the short term, but its lifetime value could be far more. There are costs like fuel, insurance, and maintenance to deal with. You can improve mileage with better driving habits. Similarly, you can save on insurance. For example, if you live in Ottawa, try to Get the best Auto Insurance Rates in Ottawa with some research. Never overlook these hidden costs of owning a car if you want to keep your finances on track.
Compare new and used cars
It is tempting to buy a used car as a teenager because you may find an attractive option at a bargain price. But you must be extra conscious while picking a used vehicle as it may turn out to be a more expensive alternative. Used cars do not come with a warranty, and they have high maintenance costs. You may even have to spend more on the fuel down the line because they often run low on mileage. If you want to buy a used vehicle, buy from a credible source.
Whether you buy a new or used vehicle, always shop around. Many first-time buyers give in to the temptation of accepting the first offer. There could be better options and deals around. Browse online to find the best ones. You can seek advice from someone who knows car facts well. It is vital to take a test drive and pay attention to reviews and specifications. Don’t hesitate to negotiate on pricing.
Teen buyers need to be conscious of the purchase of their first car. It is best to seek guidance from a parent or elder, both on the choice of the vehicle and financial matters.
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