How to buy a new car without wrecking your finances

Happy blonde girl looking for her new fancy car

Buying a new car is a big decision—not so much the make and model, but more about the financial responsibility that accompanies it. Unfortunately, what we want and what we need are often at odds with each other, and car buyers end up purchasing a vehicle with a price tag that exceeds their budget…and then some.

Here are a few tips that can help keep your next car purchase in line with what you need, want, and can afford:

All purchases are not created equal

You may have purchased a pair of Manolo Blahnik shoes that were more than a month’s rent or a new, state-of-the-art gaming system that set you back a few bills—but those splurges can be contained and could be considered short-term lapses in smart financial judgment. They busted your budget, but over the next few grueling months, you can probably get back on track by skipping your daily Starbucks run, clearing your calendar, and eating ramen noodles.

Purchasing a car that’s too expensive for your wallet could possibly tie up your finances for the next 60 months—that’s five years of monthly payments that you may or may not consistently afford. The golden rule of car buying is to NEVER ignore the total price of the car. Regardless of how they package the financing, it won’t change the actual cost. Consider purchasing a vehicle that’s below your means, unless of course, what you’re driving means more to you than your financial sanity.

Down payments are smart…and rare

Ask most car salespeople and they’re likely to say the percentage of buyers who put down a substantial down payment is pretty low. Whether you fund it with a trade-in or cash that you’ve been saving, a down payment will lower the amount of money you’ll have to pay over time. It’ll decrease your monthly loan payment and (hopefully) bring it in line with your budget.

What do you really need?

Make a list of your “must have” and “nice to have” options before you visit the dealership. Everyone wants the newest and coolest features, and for just a few hundred or a couple thousand more dollars, you can have it all…heated seats, parking assist, Wi-Fi, keyless entry, and a navigation system. They’re nice to have, but you have to determine what you need and what you want because it all leads back to the golden rule: don’t purchase above your means.

Rolling over debt is not a solution

Don’t trade one financial problem for another. For those who get tired of their cars after a few years or want to upgrade their ride every other model year, the idea of holding onto their vehicle until the loan is repaid seems preposterous. To keep themselves in a new car and avoid any down payment, they simply roll one purchase into the next. The deficiency on their current car, because it was worth less than they owed, is added to the new car loan. It’s an ugly cycle that is truly detrimental to your financial health.

Watch for hidden costs

Another thing to consider beyond the price of the car is insurance, repair, and maintenance costs. Generally, the pricier the car, the more expensive it is to insure and take care of. Talk with your insurance agent to determine how much your monthly insurance premium will increase. Research costs so you can plan for routine maintenance and repairs. Some of the results might lead you away from certain makes and models and toward more reasonably priced alternatives.

Hopefully, these tips will keep your next car purchase from wreaking havoc on your finances. Do your research, consider your budget, and keep your emotions in check. Remember, the decision to buy a car isn’t a “one day and it’s done” choice. It’ll impact the way you manage your financial life for year…and that’s a long time to eat ramen noodles.

If you’re ready to take the leap, consider Georgia’s Own for all your financing needs—from new and used vehicles to refinancing, we offer low rates and up to 100% financing, so you can buy your dream car.


  1. John Barranca

    what is your fax number

    • Ashley D.

      John — Can you please reply and let us know what you need to fax so we can make sure it goes to the right place?

  2. Love

    Does Georgia’s Own do auto loan refinance?

    • Ashley D.

      Hello — Yes, we do refinance auto loans. You can fill out an online application to get started or contact us if you have questions.

  3. Erick Wright

    What is the email address or fax number to provide a buyer’s purchase agreement to GOCU for review and potential finances to purchase the car?

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