No, this isn’t some slimy advertisement for a loan company. This is an attempt to get you to save for your next car – something people think is old fashioned and out of date.

When we think of buying a car we think of getting a loan for it so we can “Buy now, pay later” or some other dreadful marketing cliché. The truth is (and I mean it) that you should save for the car and not go into debt for it.

Statistics show that people who save up for an item, rather than buy it with financial assistance (a fancy term for borrowing someone else’s money) enjoy the item much more. They also look after the item better and are prouder of it.

I know what you’re thinking. “But I could drive away today in that car whereas saving up would take me months!” And yes, you’d be right – but think of the money you’ll save.

For example, let’s look at a 3-year car loan for $8000, with interest at around 9%. While filling out the paperwork only takes 15 minutes, after 3 years you’ll have paid back the loan – plus another $720!
“Oh it’s only $720” you say? Well that’s great! If $720 is such a tiny amount, then why not put it in the bank each week?

The thing is, for most of us (the kind of people who think they need a car loan) $720 isn’t spare change and is hard to come by. That’s a good enough reason to keep that money in a separate bank account – one without a debit card to reduce temptation – and build it up from there.

Some might say, “But what about those 0% interest loans?” and admittedly they do sound good. But like any loan they will have substantial “fees” built into the loan. Not only that, you’re trapped with that car for 3 years.

Then of course what happens if you lose your job or you have unforeseen circumstances?
I can tell you right now what will happen: the loan company would use a debt collector to track down your car and take it away in the middle of the night. Then all of your repayments will have been a waste of time – and you’d be carless.

Then there’s depreciation. Get halfway through your loan and your car will probably be worth 20% to 40% less than what you took the loan out for – yet you’re still paying! You’re trapped.

People like us find all kinds of ways to justify out-of-reach purchases. Do you really need that late model car? Probably not, so make do with what you’ve got and save until you can!

Yes it will take time to save for a car. It could even take a couple of years. But imagine the bargaining power you’ll have arriving at a car dealer with cash! Not only that, you’ll love your car so much more!

I paid cash for my current car and owe nothing on it. It took a long time to save the money I needed but I can sleep easy knowing I have no monthly payments. Plus, if I decide to sell it I don’t have to pay anyone back a single cent.

I’m not alone either; thousands of others are switching to saving for their cars instead of borrowing.
It’s healthier and smarter – but don’t just take my word for it; do it yourself. You’ll thank me later.