This piece is part of my 2016–2026 archive migration. Some original formatting, content, and external links may be missing, changed, or not be optimized.
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But she forgot about her debt load sitting in credit cards, student loans, and personal loans.
Furthermore, her expense load was relatively high and trending upwards.
Not only does she have a new car now, but she also has more debt and higher car insurance, which added to her high expense load.
A healthier financial option would be to maintain her old car, get any repairs needed, and avoid adding new debts. Over time, she could financially prepare to obtain a new car when it wouldn’t create a financial strain.
Since she barely has savings, she only hurt herself financially with this purchase. Though she might look better when she’s driving, her financial portfolio took a beating on this purchase.
If You’re Going To Finance A Car, Try This First
1. Ask yourself, do you really need a new car?
Can you share a car?
Can you use public transportation?
Can you catch Uber or Lyft?
Do you even go out of the house much?
What value will a car provide you that you don’t have now with your current car or non-existent one?
2. Delay the purchase as long as possible.
To this day, I’m still driving the first car I bought. It’s been over a decade. I don’t get tons of compliments on my car as others do, but thankfully my self-esteem doesn’t come from the car I drive.
I do keep it up, though, to make the most of my car.
3. Invest in repairs.
I could’ve bought a new car instead of investing in repairs. Instead, I invested in cosmetic repairs and maintenance to maximize the utilization of my car.
And what did I get in return? No debt. And my car is paid for and looks better than I bought it.
4. Pay off your car first.
I knew someone less than $1,000 away from paying off their car.
Instead of paying it off and investing that extra cash flow, they bought a new car and landed nearly half a hundred grand in debt.
Why not enjoy the paid-off car for a little while?
People are so addicted to the debt they don’t know how to take a break from it.
They’ve become numb to the invisible chains holding them financially hostage.
5. Final option: Have enough assets stacked away that can be liquidated to cover the purchase, so you’re not creating real debt.
If you decide to follow through on the car purchase, do it prudently, which means you don’t go into debt to cover the purchase because you have enough assets in the bank to cover it.
If you decide to finance the car instead of paying cash, does the monthly payment hurt, or does it feel good?
Do you have to force or move things around to make the purchase work because if so, this isn’t the move for you.
This content is for informational purposes only — not professional advice. Consult a qualified professional before making any major decisions.