If you’re bringing in a healthy $70,000 salary, congratulations! You’re in a great position to buy a new car. But with so many options on the market, it can be hard to know where to start your search. This guide will help you narrow down your choices and find the perfect set of wheels for your budget.
Step 1: Decide How Much You Can Afford to Spend
The first step in any car-buying journey is deciding how much you can afford to spend. Unfortunately, there’s no one-size-fits-all answer to this question. It depends on factors like your other debts, your savings goals, and your monthly expenses.
If you’re not sure where to start, financial experts recommend allocating around 10% of your income to car payments and associated costs like insurance and gas. This means that, with a $70,000 salary, you should aim to spend no more than $7,000 per year on your car—or around $583 per month.
Of course, this is just a guideline. If you have a lower debt load or want to save more aggressively for other goals (like retirement), you may be able to allocate a higher percentage of your income to your car payment. Alternatively, if you live in an area with high insurance rates or are looking for a luxury vehicle, you may need to adjust your budget downward.
Step 2: Consider Your Priorities
After you’ve decided how much you can afford to spend on a car, it’s time to start thinking about which features are most important to you. For example, if you have a long commute, fuel efficiency might be at the top of your list. Or if you frequently transport large groups of people or haul cargo, passenger and cargo space might be more important than some of the bells and whistles that come standard on many new cars.
Other things that might be important to consider include:
• Reliability – How often will you need repairs?
• Safety – What safety features are must-haves?
• Technology – Do you want the latest and greatest infotainment system?
• Resale value – How much money do you want to get back when it’s time to sell or trade in?
Step 3: Do Your Research
Now that you know how much money you can afford to spend and what features are most important to you, it’s time for some good old-fashioned research. Checking out reviews from unbiased sources like Consumer Reports or Edmunds can give you some insight into which cars offer the best value for your money. Once you’ve narrowed down your choices, it’s time for test drives!
After all, there’s nothing like getting behind the wheel yourself to see if a car is the right fit.
Armed with this information and some solid research, you’re well on your way to finding the perfect car for both your budget and lifestyle. Happy shopping!