Did you just find your dream car? If so, there’s a good chance you’re going to have to pay a pretty penny to take it home with you.
Average new car prices have skyrocketed in recent years. These days, a new car usually costs somewhere between $35,000 and $40,000—and it can cost a whole lot more than that if you get one with all the bells and whistles.
This can make it difficult for people to buy cars they really love. You can get around this by learning how to pay for a car without accumulating a mountain of debt.
Here are six ways to fund your dream ride.
- Create a Sinking Fund
Do you know that you’re going to need to buy a new car for yourself in a year or two? Don’t wait until you go to buy it to figure out how to pay for a car.
Instead, consider starting what is called a sinking fund for your new car. It’s a great way to save up the money you’ll need to bring your dream car home.
A sinking fund is a fund that you create for the purpose of paying off a bill that you’re going to encounter at some point in the near future. People use sinking funds for all kinds of things, including:
- Christmas gifts
- Medical procedures
- Home repairs
By creating one for your dream car, you can slowly build up your fund until you have enough money to pay for the car you want. Most financial experts recommend using a money market account to start your fund since you’ll earn more interest on it than you would by putting your money into a regular savings account.
- Start a Side Hustle
A sinking fund is a great tool for anyone looking to save up money to buy their dream car. But it’s not going to do you much good if you’re not able to fill it with any extra money that you’re able to make.
If you’re just barely making ends meet these days and don’t have extra money lying around, change that by starting a side hustle. There are so many side hustles that you can jumpstart these days to bring in more money every month.
Some good side hustles are:
- Driving for a ride-sharing company
- Delivering pizzas for your local pizza parlor
- Buying and reselling valuable items
You might be able to start making more money than you could have ever imagined every month. It won’t be long at all before you have enough of it to purchase your dream car.
- Sell Personal Possessions
Do you have a bunch of things tucked away in your house that you’re not using much anymore?
Maybe you have an old laptop that you’ve replaced with a newer model. Or maybe you have a bunch of old DVDs that you haven’t watched in years.
Whatever the case, you likely have lots of items in your home that would be worth something to someone else. Consider listing these items for sale online or holding a garage sale to sell as many of them as you can.
You might be surprised by how much money you can make by selling stuff that you already own. It’s one of the easiest ways to put together a sizable downpayment for a new car.
- Sell an Old Car
Once you buy a new car, you’re not going to need the old one that you have sitting out in the driveway, right? So think about getting rid of it as soon as you can to give yourself some more money to buy your dream car.
Even if your old car isn’t in very good condition, there is someone out there who will buy it from you. You might have luck selling it to a private buyer, or you might want to consider selling it to a company that specializes in paying cash for junk cars NJ.
Look around at your different options and see how much you can get for your old car. You can take the money that it generates and put it towards buying a new car.
- Search for Car Sales
Did you know that some times of the year are better for buying new cars than others? You can save yourself thousands of dollars by picking the right time to buy a car.
President’s Day, Memorial Day, and Labor Day are all great times to purchase cars. The end of June and the beginning of July are also typically terrific times to buy cars. The end of every year is an ideal time to invest in a new car, too.
It’ll be so much easier to pay for a new car when it’s on sale and available at a deep discount.
- Ask Family for Help
Borrowing money from a family member always has the potential to turn into an uncomfortable situation. The last thing you want to do is end up owing a family member money that you can’t pay back.
But if you have someone in your family who has the funds to help you pay for your dream car, it wouldn’t be the worst idea in the world to ask for their help. As long as you put a firm repayment plan into place, it can make it possible for you to get a new car.
As an added bonus, your family member won’t charge you the kind of interest that a bank or another lender will. You should offer to pay them some interest, but you won’t get buried in interest fees every month when you take this approach.
Try to Learn How to Pay for a Car With Cash
Collectively, Americans owe more than $1.1 trillion in auto debt. It has become a big problem for many people and has stopped them from achieving financial success in other areas of their lives.
Use the tips listed here to learn how to pay for a car with cash so that you don’t put yourself into too much debt. You’ll enjoy your dream car so much more when you’re not in deep debt because of it.
Read our blog to get more tips on buying a new car.