The Average New Car Loan Payment Is $499

This Article was Updated July 5, 2018

When you are looking to buy a vehicle, the first thing you should do is apply for a preapproved loan. The loan process can seem daunting, but it’s easier than you think and getting preapproval prior to going to the car dealer may help alleviate a lot of frustration along the way.

Here are five steps for getting a car loan.

  1. Check Your Credit
  2. Know Your Budget
  3. Determine How Much You Can Afford
  4. Get Preapproved
  5. Go Shopping

1. Check Your Credit

Before you shop for a loan, check your credit report. The better your credit, the cheaper it is to borrow money and secure auto financing. With a higher credit score and a better credit history, you may be entitled to lower loan interest rates, and you may also qualify for lower auto insurance premiums.

Review your credit report to look for unusual activity. Dispute errors such as incorrect balances or late payments on your credit report. If you have a lower credit score and would like to give it a bit of a boost before car shopping, pay off credit card balances or smaller loans.

If your credit score is low, don’t fret. A lower score won’t prevent you from getting a loan. But depending on your score, you may end up paying a higher interest rate. If you have a low credit score and want to shoot for lower interest rates, take some time to improve your credit score before you apply for loans or attempt to secure any other auto financing.

2. Know Your Budget

Having a budget and knowing how much of a car payment you can afford is essential. You want to be sure your car payment fits in line with your other financial goals. Yes, you may be able to cover $400 a month, but that amount may take away from your monthly savings goal.

If you don’t already have a budget, start with your monthly income after taxes and subtract your usual monthly expenses and how much you plan to put in savings each month. For bills that don’t come every month, such as Amazon Prime or Xbox Live, take the yearly charge and divide it by 12. Then add the result to your monthly budget. If you’re worried, you spend too much each month, find simple ways to whittle your budget down.

You’ll also want to plan ahead for new car costs, such as vehicle registration and auto insurance, and regular car maintenance, such as oil changes and basic repairs. By knowing your budget and what to expect, you can easily see how much room you have for a car payment.

3. Determine How Much You Can Afford

Once you understand where you are financially, you can decide on a reasonable monthly car payment. For many, a good rule of thumb is to not spend more than 10% of your take-home income on a vehicle. In other words, if you make $60,000 after taxes a year, you shouldn’t spend more than $500 per month on car payments. But depending on your budget, you may be better off with a lower payment.

With a payment in mind, you can use an auto loan calculator to figure out the largest loan you can afford. Simply enter in the monthly payment you’d like, the interest rate, and the loan period. And remember that making a larger down payment can reduce your monthly payment. You can also use an auto loan calculator to break down a total loan amount into monthly payments.

You’ll also want to think about how long you’d like to pay off your loan. Car loan terms are normally three, four, five, or six years long. With a longer loan period, you’ll have lower monthly payments. But beware—a lengthy car loan term can have a negative effect on your finances. First, you’ll spend more on the total price of the vehicle by paying more interest. Second, you may be upside down on the loan for a larger chunk of time, meaning you owe more than the car is actually worth.

4. Get Preapproved

Before you ever set foot on a car lot, you’ll want to be preapproved for a car loan. Research potential loans and then compare the terms, lengths of time, and interest rates to find the best deal. A great place to shop for a car loan is at your local bank or credit union. But don’t stop there—look online too. The loan with the best terms, interest rate, and loan amount will be the one you want to get preapproved for. Just know that preapproved loans only last for a certain amount of time, so it’s best to get preapproved when you’re nearly ready to shop for a car.

However, when you apply, the lender will run a credit check—which will lower your credit score slightly—so you’ll want to keep all your loan applications within a 14-day period. That way, the many credit checks will only show as one inquiry instead of multiple ones.

Get matched with a personal loan that’s right for you today.

Learn more

When you’re preapproved, the lender decides if you’re eligible and how much you’re eligible for. They’ll also tell you what interest rate you qualify for, so you’ll know what you have to work with before you even walk into a dealership. But keep in mind that preapproved loans aren’t the same as final auto loans. Depending on the car you buy, your final loan could be less than what you were preapproved for.

In most cases, if you secure a pre-approved loan, you shouldn’t have any problems getting a final loan. But being preapproved doesn’t mean you’ll automatically receive a loan when the time comes. Factors such as the info you provided or whether or not the lender agrees on the value of the car can affect the final loan approval. It’s never a deal until it’s a done deal.

If you can’t get preapproved, don’t abandon all hope. You could also try making a larger down payment to reduce the amount you are borrowing, or you could ask someone to cosign on the loan. If you ask someone to cosign, take it seriously. By doing so, you are asking them to put their credit on the line for you and repay the loan if you can’t.

When co-signing a car loan, they do not acquire any rights to the vehicle. They are simply stating that they have agreed to become obligated to repay the total amount of the loan if you were to default or found that you were unable to pay.

Co-signing a car loan is more like an additional form of insurance (or reassurance) for the lender that the debt will be paid no matter what.

Usually, a person with bad credit or less-than-perfect credit may require the assistance of a co-signer for their auto financing and loan.

5. Go Shopping

Now you’re ready to look for a new ride. Put in a little time for research and find cars that are known to be reliable and fit into your budget. You’ll also want to consider size, color, gas mileage, and extra features. Use resources like Consumer Reports to read reviews and get an idea of which cars may be best for you.

Once you have narrowed down the car you are interested in, investigate how much it’s worth, so you aren’t accidentally duped. Sites such as Kelley Blue Book or Edmunds can help you figure out the going rate for your ideal car. After you’re armed with this information, compare prices at different car dealerships in your area. And don’t forget to check dealer incentives and rebates to get the best possible price.

By following these steps, you’ll be ready to make the best financial decision when getting a car loan. Even if you aren’t ready to buy a car right now, it doesn’t hurt to be prepared. Start by acquiring a free copy of your credit summary.

It is always a good idea to pull your credit reports each year, so you can make sure they are as accurate as they should be. If you find any mistakes, be sure to dispute them with the proper credit bureau. Remember, each credit report may differ, so it is best to acquire all three.
If you want to know what your credit is before purchasing a car, you can check your three credit reports for free once a year. To track your credit more regularly, Credit.com’s free Credit Report Card is an easy-to-understand breakdown of your credit report information that uses letter grades—plus you get a free credit score updated every 14 days.

You can also carry on the conversation on our social media platforms. Like and follow us on Facebook and leave us a tweet on Twitter.

Image: istock

Source: credit.com

A Quick Guide to How Much Car You Can Really Afford

This Article was Updated July 5, 2018

When you are looking to buy a vehicle, the first thing you should do is apply for a preapproved loan. The loan process can seem daunting, but it’s easier than you think and getting preapproval prior to going to the car dealer may help alleviate a lot of frustration along the way.

Here are five steps for getting a car loan.

  1. Check Your Credit
  2. Know Your Budget
  3. Determine How Much You Can Afford
  4. Get Preapproved
  5. Go Shopping

1. Check Your Credit

Before you shop for a loan, check your credit report. The better your credit, the cheaper it is to borrow money and secure auto financing. With a higher credit score and a better credit history, you may be entitled to lower loan interest rates, and you may also qualify for lower auto insurance premiums.

Review your credit report to look for unusual activity. Dispute errors such as incorrect balances or late payments on your credit report. If you have a lower credit score and would like to give it a bit of a boost before car shopping, pay off credit card balances or smaller loans.

If your credit score is low, don’t fret. A lower score won’t prevent you from getting a loan. But depending on your score, you may end up paying a higher interest rate. If you have a low credit score and want to shoot for lower interest rates, take some time to improve your credit score before you apply for loans or attempt to secure any other auto financing.

2. Know Your Budget

Having a budget and knowing how much of a car payment you can afford is essential. You want to be sure your car payment fits in line with your other financial goals. Yes, you may be able to cover $400 a month, but that amount may take away from your monthly savings goal.

If you don’t already have a budget, start with your monthly income after taxes and subtract your usual monthly expenses and how much you plan to put in savings each month. For bills that don’t come every month, such as Amazon Prime or Xbox Live, take the yearly charge and divide it by 12. Then add the result to your monthly budget. If you’re worried, you spend too much each month, find simple ways to whittle your budget down.

You’ll also want to plan ahead for new car costs, such as vehicle registration and auto insurance, and regular car maintenance, such as oil changes and basic repairs. By knowing your budget and what to expect, you can easily see how much room you have for a car payment.

3. Determine How Much You Can Afford

Once you understand where you are financially, you can decide on a reasonable monthly car payment. For many, a good rule of thumb is to not spend more than 10% of your take-home income on a vehicle. In other words, if you make $60,000 after taxes a year, you shouldn’t spend more than $500 per month on car payments. But depending on your budget, you may be better off with a lower payment.

With a payment in mind, you can use an auto loan calculator to figure out the largest loan you can afford. Simply enter in the monthly payment you’d like, the interest rate, and the loan period. And remember that making a larger down payment can reduce your monthly payment. You can also use an auto loan calculator to break down a total loan amount into monthly payments.

You’ll also want to think about how long you’d like to pay off your loan. Car loan terms are normally three, four, five, or six years long. With a longer loan period, you’ll have lower monthly payments. But beware—a lengthy car loan term can have a negative effect on your finances. First, you’ll spend more on the total price of the vehicle by paying more interest. Second, you may be upside down on the loan for a larger chunk of time, meaning you owe more than the car is actually worth.

4. Get Preapproved

Before you ever set foot on a car lot, you’ll want to be preapproved for a car loan. Research potential loans and then compare the terms, lengths of time, and interest rates to find the best deal. A great place to shop for a car loan is at your local bank or credit union. But don’t stop there—look online too. The loan with the best terms, interest rate, and loan amount will be the one you want to get preapproved for. Just know that preapproved loans only last for a certain amount of time, so it’s best to get preapproved when you’re nearly ready to shop for a car.

However, when you apply, the lender will run a credit check—which will lower your credit score slightly—so you’ll want to keep all your loan applications within a 14-day period. That way, the many credit checks will only show as one inquiry instead of multiple ones.

Get matched with a personal loan that’s right for you today.

Learn more

When you’re preapproved, the lender decides if you’re eligible and how much you’re eligible for. They’ll also tell you what interest rate you qualify for, so you’ll know what you have to work with before you even walk into a dealership. But keep in mind that preapproved loans aren’t the same as final auto loans. Depending on the car you buy, your final loan could be less than what you were preapproved for.

In most cases, if you secure a pre-approved loan, you shouldn’t have any problems getting a final loan. But being preapproved doesn’t mean you’ll automatically receive a loan when the time comes. Factors such as the info you provided or whether or not the lender agrees on the value of the car can affect the final loan approval. It’s never a deal until it’s a done deal.

If you can’t get preapproved, don’t abandon all hope. You could also try making a larger down payment to reduce the amount you are borrowing, or you could ask someone to cosign on the loan. If you ask someone to cosign, take it seriously. By doing so, you are asking them to put their credit on the line for you and repay the loan if you can’t.

When co-signing a car loan, they do not acquire any rights to the vehicle. They are simply stating that they have agreed to become obligated to repay the total amount of the loan if you were to default or found that you were unable to pay.

Co-signing a car loan is more like an additional form of insurance (or reassurance) for the lender that the debt will be paid no matter what.

Usually, a person with bad credit or less-than-perfect credit may require the assistance of a co-signer for their auto financing and loan.

5. Go Shopping

Now you’re ready to look for a new ride. Put in a little time for research and find cars that are known to be reliable and fit into your budget. You’ll also want to consider size, color, gas mileage, and extra features. Use resources like Consumer Reports to read reviews and get an idea of which cars may be best for you.

Once you have narrowed down the car you are interested in, investigate how much it’s worth, so you aren’t accidentally duped. Sites such as Kelley Blue Book or Edmunds can help you figure out the going rate for your ideal car. After you’re armed with this information, compare prices at different car dealerships in your area. And don’t forget to check dealer incentives and rebates to get the best possible price.

By following these steps, you’ll be ready to make the best financial decision when getting a car loan. Even if you aren’t ready to buy a car right now, it doesn’t hurt to be prepared. Start by acquiring a free copy of your credit summary.

It is always a good idea to pull your credit reports each year, so you can make sure they are as accurate as they should be. If you find any mistakes, be sure to dispute them with the proper credit bureau. Remember, each credit report may differ, so it is best to acquire all three.
If you want to know what your credit is before purchasing a car, you can check your three credit reports for free once a year. To track your credit more regularly, Credit.com’s free Credit Report Card is an easy-to-understand breakdown of your credit report information that uses letter grades—plus you get a free credit score updated every 14 days.

You can also carry on the conversation on our social media platforms. Like and follow us on Facebook and leave us a tweet on Twitter.

Image: istock

Source: credit.com

Auto Loan Debt Tops $1 Trillion

This Article was Updated July 5, 2018

When you are looking to buy a vehicle, the first thing you should do is apply for a preapproved loan. The loan process can seem daunting, but it’s easier than you think and getting preapproval prior to going to the car dealer may help alleviate a lot of frustration along the way.

Here are five steps for getting a car loan.

  1. Check Your Credit
  2. Know Your Budget
  3. Determine How Much You Can Afford
  4. Get Preapproved
  5. Go Shopping

1. Check Your Credit

Before you shop for a loan, check your credit report. The better your credit, the cheaper it is to borrow money and secure auto financing. With a higher credit score and a better credit history, you may be entitled to lower loan interest rates, and you may also qualify for lower auto insurance premiums.

Review your credit report to look for unusual activity. Dispute errors such as incorrect balances or late payments on your credit report. If you have a lower credit score and would like to give it a bit of a boost before car shopping, pay off credit card balances or smaller loans.

If your credit score is low, don’t fret. A lower score won’t prevent you from getting a loan. But depending on your score, you may end up paying a higher interest rate. If you have a low credit score and want to shoot for lower interest rates, take some time to improve your credit score before you apply for loans or attempt to secure any other auto financing.

2. Know Your Budget

Having a budget and knowing how much of a car payment you can afford is essential. You want to be sure your car payment fits in line with your other financial goals. Yes, you may be able to cover $400 a month, but that amount may take away from your monthly savings goal.

If you don’t already have a budget, start with your monthly income after taxes and subtract your usual monthly expenses and how much you plan to put in savings each month. For bills that don’t come every month, such as Amazon Prime or Xbox Live, take the yearly charge and divide it by 12. Then add the result to your monthly budget. If you’re worried, you spend too much each month, find simple ways to whittle your budget down.

You’ll also want to plan ahead for new car costs, such as vehicle registration and auto insurance, and regular car maintenance, such as oil changes and basic repairs. By knowing your budget and what to expect, you can easily see how much room you have for a car payment.

3. Determine How Much You Can Afford

Once you understand where you are financially, you can decide on a reasonable monthly car payment. For many, a good rule of thumb is to not spend more than 10% of your take-home income on a vehicle. In other words, if you make $60,000 after taxes a year, you shouldn’t spend more than $500 per month on car payments. But depending on your budget, you may be better off with a lower payment.

With a payment in mind, you can use an auto loan calculator to figure out the largest loan you can afford. Simply enter in the monthly payment you’d like, the interest rate, and the loan period. And remember that making a larger down payment can reduce your monthly payment. You can also use an auto loan calculator to break down a total loan amount into monthly payments.

You’ll also want to think about how long you’d like to pay off your loan. Car loan terms are normally three, four, five, or six years long. With a longer loan period, you’ll have lower monthly payments. But beware—a lengthy car loan term can have a negative effect on your finances. First, you’ll spend more on the total price of the vehicle by paying more interest. Second, you may be upside down on the loan for a larger chunk of time, meaning you owe more than the car is actually worth.

4. Get Preapproved

Before you ever set foot on a car lot, you’ll want to be preapproved for a car loan. Research potential loans and then compare the terms, lengths of time, and interest rates to find the best deal. A great place to shop for a car loan is at your local bank or credit union. But don’t stop there—look online too. The loan with the best terms, interest rate, and loan amount will be the one you want to get preapproved for. Just know that preapproved loans only last for a certain amount of time, so it’s best to get preapproved when you’re nearly ready to shop for a car.

However, when you apply, the lender will run a credit check—which will lower your credit score slightly—so you’ll want to keep all your loan applications within a 14-day period. That way, the many credit checks will only show as one inquiry instead of multiple ones.

Get matched with a personal loan that’s right for you today.

Learn more

When you’re preapproved, the lender decides if you’re eligible and how much you’re eligible for. They’ll also tell you what interest rate you qualify for, so you’ll know what you have to work with before you even walk into a dealership. But keep in mind that preapproved loans aren’t the same as final auto loans. Depending on the car you buy, your final loan could be less than what you were preapproved for.

In most cases, if you secure a pre-approved loan, you shouldn’t have any problems getting a final loan. But being preapproved doesn’t mean you’ll automatically receive a loan when the time comes. Factors such as the info you provided or whether or not the lender agrees on the value of the car can affect the final loan approval. It’s never a deal until it’s a done deal.

If you can’t get preapproved, don’t abandon all hope. You could also try making a larger down payment to reduce the amount you are borrowing, or you could ask someone to cosign on the loan. If you ask someone to cosign, take it seriously. By doing so, you are asking them to put their credit on the line for you and repay the loan if you can’t.

When co-signing a car loan, they do not acquire any rights to the vehicle. They are simply stating that they have agreed to become obligated to repay the total amount of the loan if you were to default or found that you were unable to pay.

Co-signing a car loan is more like an additional form of insurance (or reassurance) for the lender that the debt will be paid no matter what.

Usually, a person with bad credit or less-than-perfect credit may require the assistance of a co-signer for their auto financing and loan.

5. Go Shopping

Now you’re ready to look for a new ride. Put in a little time for research and find cars that are known to be reliable and fit into your budget. You’ll also want to consider size, color, gas mileage, and extra features. Use resources like Consumer Reports to read reviews and get an idea of which cars may be best for you.

Once you have narrowed down the car you are interested in, investigate how much it’s worth, so you aren’t accidentally duped. Sites such as Kelley Blue Book or Edmunds can help you figure out the going rate for your ideal car. After you’re armed with this information, compare prices at different car dealerships in your area. And don’t forget to check dealer incentives and rebates to get the best possible price.

By following these steps, you’ll be ready to make the best financial decision when getting a car loan. Even if you aren’t ready to buy a car right now, it doesn’t hurt to be prepared. Start by acquiring a free copy of your credit summary.

It is always a good idea to pull your credit reports each year, so you can make sure they are as accurate as they should be. If you find any mistakes, be sure to dispute them with the proper credit bureau. Remember, each credit report may differ, so it is best to acquire all three.
If you want to know what your credit is before purchasing a car, you can check your three credit reports for free once a year. To track your credit more regularly, Credit.com’s free Credit Report Card is an easy-to-understand breakdown of your credit report information that uses letter grades—plus you get a free credit score updated every 14 days.

You can also carry on the conversation on our social media platforms. Like and follow us on Facebook and leave us a tweet on Twitter.

Image: istock

Source: credit.com

10 of the Best Ways Anyone Can Save on Car Costs

Woman with money in car dealership
RomanR / Shutterstock.com

New or used, sporty or practical, a car keeps wringing money out of its owner throughout its lifetime. Gas, oil changes, accidents — no question, a car is an expensive family member.

But for many of us, a car is also a necessity. Until that “Star Trek” transporter technology arrives, we’ll be driving — and fixing, filling up and coaxing — our cars to keep running for years.

That’s why even the smallest ways to save on car costs are important. From the right insurance policy to simple car-maintenance tips, knowing how to keep your car’s monetary demands at bay can leave more cash in your wallet.

Rev your engines — here are tips for saving on car costs that everyone can use.

1. Shop around for a better rate

hands Blue Toy Car On The Reflective Desk
Andrey_Popov / Shutterstock.com

Switching vehicle insurance companies might save you a bundle.

In “6 Real Ways to Save on Your Car Costs,” Money Talks News writer Miranda Marquit suggests using The Zebra, a car insurance search engine, to get free quotes for changing your coverage.

To use The Zebra, visit the website and enter your ZIP code. Answer some basic questions, and get your quotes. You can also find the best car insurance options listed by state and vehicle. The Zebra does not sell users’ information to third parties or spammers, so you won’t get sales calls from doing a search.

Gabi is another car insurance search engine. In under two minutes, you can easily submit your current insurance policy and let Gabi shop around for the best coverage, delivering as many as 20 quotes.

Or, if you prefer, use The Zebra’s licensed insurance brokers to ask questions and understand your options.

2. Keep tires properly inflated

Orrathai Poolsawat / Shutterstock.com

Driving with properly inflated tires can improve your gas mileage by an average of 4%, the Environmental Protection Agency (EPA) reports.

That one improvement will show up at the gas pump.

And it’s easier than ever to do. You can find digital and analog gauges to buy for a few dollars that are easy to use and read. Some newer vehicles may even sport a digital readout of the inflation level for tires.

3. Trim your car insurance premiums

PORTRAIT IMAGES ASIA BY NONWARIT / Shutterstock.com

Take a little time to shave even more off your vehicle insurance bill. Start by reading Money Talks News founder Stacy Johnson’s “How to Get the Best Possible Deal on Car Insurance.”

Next, try these steps:

  • Call your insurance agent. Ask how you can save on your insurance. For example, discuss raising your deductibles (which may lower your premium) or whether it is no longer worthwhile to pay for comprehensive and collision coverage for an older vehicle. Also, ask about getting a deal for bundling your auto insurance with other policies, such as homeowners or renters insurance.
  • Take a defensive driving class. Careful drivers are cheaper to insure. If you’re an AARP member, there’s even an online course you can take. CarInsurance.com says: “[S]tates may require insurers to offer certain discounts to encourage good driver behavior — such as taking defensive driving courses.”

4. Rent out your car to help pay its upkeep

Man in car receiving keys.
Ivanko80 / Shutterstock.com

Get your car to help earn its keep by renting it to other people when you aren’t driving it.

Turo is a car-sharing marketplace, sort of like an Airbnb for vehicles. Turo’s website is where people who want to rent a ride can see what’s available in their area.

Our article “How to Make Extra Money Renting Out Your Car” has the details.

5. Don’t be a car snob

Rawpixel.com / Shutterstock.com

When you buy or lease your next car, think seriously about getting a less-expensive model.

Here’s where you can save thousands of dollars from the start simply by choosing a Mazda over a Mercedes, or a slightly used car over a brand-spanking-new vehicle.

Money Talks News founder Stacy Johnson says he’s never bought a new car, since a new vehicle loses thousands in value the minute you drive it off the lot.

Depreciation can account for nearly 40% of the expense of owning a new vehicle, costing you more than $3,000 per year, Money Talks News reports.

6. Take care of your car

Lemusique / Shutterstock.com

You don’t have to baby your car, but don’t ignore its needs, either.

Regular oil changes, air-filter replacements and even things as simple as new wiper blades can keep it purring longer.

7. Handle small repairs yourself

antoniodiaz / Shutterstock.com

Not everyone is a mechanic. But these days, many simple car-maintenance items can be performed at home by even fairly new drivers.

Oil changes, tire rotations and air-filter replacement don’t really require a professional to do them. Get started by following the steps in “8 Car Repairs and Maintenance Tasks You Can DIY.”

Other good ideas:

  • Ask a handy friend to show you how to do maintenance jobs the first time.
  • Take a basic car know-how course at your community college.

8. Relax your hot foot

Alexandru Nika / Shutterstock.com

If your speed goes up, your gas mileage will go down. There’s no trophy for being the Mario Andretti of your Minnesota suburb.

Likewise, don’t slam your foot down on your brake pedal either. You’ll extend the life of your brake pads by coasting or easing into stops rather than constantly pounding on the brakes.

9. Use cruise control

Holyshyn Oleh / Shutterstock.com

Know how and when to engage your cruise control, and don’t be afraid to use it. AARP estimates doing so can reduce your highway fuel usage by 7%.

Depending on how much you drive and how much of that travel is on the highway, you could save $100 or more annually.

10. Be smart about gas

Vera Petrunina / Shutterstock.com

Someday, we may all have electric cars. But until then, gasoline will remain a major part of your car budget.

Be smart about where you buy it and how you pay for it. Many grocery stores or credit cards offer loyalty points that can be used at certain gas stations. Don’t let those go to waste.

Also, try checking into smartphone apps, like GasBuddy, that can help you locate the cheapest price on gas near you.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Source: moneytalksnews.com

5 Steps for Getting a Car Loan

July 5, 2018 &• 10 min read by Lacey Langford Comments 10 Comments

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Advertiser Disclosure

Disclaimer

This Article was Updated July 5, 2018

When you are looking to buy a vehicle, the first thing you should do is apply for a preapproved loan. The loan process can seem daunting, but it’s easier than you think and getting preapproval prior to going to the car dealer may help alleviate a lot of frustration along the way.

Here are five steps for getting a car loan.

  1. Check Your Credit
  2. Know Your Budget
  3. Determine How Much You Can Afford
  4. Get Preapproved
  5. Go Shopping

1. Check Your Credit

Before you shop for a loan, check your credit report. The better your credit, the cheaper it is to borrow money and secure auto financing. With a higher credit score and a better credit history, you may be entitled to lower loan interest rates, and you may also qualify for lower auto insurance premiums.

Review your credit report to look for unusual activity. Dispute errors such as incorrect balances or late payments on your credit report. If you have a lower credit score and would like to give it a bit of a boost before car shopping, pay off credit card balances or smaller loans.

If your credit score is low, don’t fret. A lower score won’t prevent you from getting a loan. But depending on your score, you may end up paying a higher interest rate. If you have a low credit score and want to shoot for lower interest rates, take some time to improve your credit score before you apply for loans or attempt to secure any other auto financing.

2. Know Your Budget

Having a budget and knowing how much of a car payment you can afford is essential. You want to be sure your car payment fits in line with your other financial goals. Yes, you may be able to cover $400 a month, but that amount may take away from your monthly savings goal.

If you don’t already have a budget, start with your monthly income after taxes and subtract your usual monthly expenses and how much you plan to put in savings each month. For bills that don’t come every month, such as Amazon Prime or Xbox Live, take the yearly charge and divide it by 12. Then add the result to your monthly budget. If you’re worried, you spend too much each month, find simple ways to whittle your budget down.

You’ll also want to plan ahead for new car costs, such as vehicle registration and auto insurance, and regular car maintenance, such as oil changes and basic repairs. By knowing your budget and what to expect, you can easily see how much room you have for a car payment.

3. Determine How Much You Can Afford

Once you understand where you are financially, you can decide on a reasonable monthly car payment. For many, a good rule of thumb is to not spend more than 10% of your take-home income on a vehicle. In other words, if you make $60,000 after taxes a year, you shouldn’t spend more than $500 per month on car payments. But depending on your budget, you may be better off with a lower payment.

With a payment in mind, you can use an auto loan calculator to figure out the largest loan you can afford. Simply enter in the monthly payment you’d like, the interest rate, and the loan period. And remember that making a larger down payment can reduce your monthly payment. You can also use an auto loan calculator to break down a total loan amount into monthly payments.

You’ll also want to think about how long you’d like to pay off your loan. Car loan terms are normally three, four, five, or six years long. With a longer loan period, you’ll have lower monthly payments. But beware—a lengthy car loan term can have a negative effect on your finances. First, you’ll spend more on the total price of the vehicle by paying more interest. Second, you may be upside down on the loan for a larger chunk of time, meaning you owe more than the car is actually worth.

4. Get Preapproved

Before you ever set foot on a car lot, you’ll want to be preapproved for a car loan. Research potential loans and then compare the terms, lengths of time, and interest rates to find the best deal. A great place to shop for a car loan is at your local bank or credit union. But don’t stop there—look online too. The loan with the best terms, interest rate, and loan amount will be the one you want to get preapproved for. Just know that preapproved loans only last for a certain amount of time, so it’s best to get preapproved when you’re nearly ready to shop for a car.

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However, when you apply, the lender will run a credit check—which will lower your credit score slightly—so you’ll want to keep all your loan applications within a 14-day period. That way, the many credit checks will only show as one inquiry instead of multiple ones.

When you’re preapproved, the lender decides if you’re eligible and how much you’re eligible for. They’ll also tell you what interest rate you qualify for, so you’ll know what you have to work with before you even walk into a dealership. But keep in mind that preapproved loans aren’t the same as final auto loans. Depending on the car you buy, your final loan could be less than what you were preapproved for.

In most cases, if you secure a pre-approved loan, you shouldn’t have any problems getting a final loan. But being preapproved doesn’t mean you’ll automatically receive a loan when the time comes. Factors such as the info you provided or whether or not the lender agrees on the value of the car can affect the final loan approval. It’s never a deal until it’s a done deal.

If you can’t get preapproved, don’t abandon all hope. You could also try making a larger down payment to reduce the amount you are borrowing, or you could ask someone to cosign on the loan. If you ask someone to cosign, take it seriously. By doing so, you are asking them to put their credit on the line for you and repay the loan if you can’t.

When co-signing a car loan, they do not acquire any rights to the vehicle. They are simply stating that they have agreed to become obligated to repay the total amount of the loan if you were to default or found that you were unable to pay.

Co-signing a car loan is more like an additional form of insurance (or reassurance) for the lender that the debt will be paid no matter what.

Usually, a person with bad credit or less-than-perfect credit may require the assistance of a co-signer for their auto financing and loan.

5. Go Shopping

Now you’re ready to look for a new ride. Put in a little time for research and find cars that are known to be reliable and fit into your budget. You’ll also want to consider size, color, gas mileage, and extra features. Use resources like Consumer Reports to read reviews and get an idea of which cars may be best for you.

Once you have narrowed down the car you are interested in, investigate how much it’s worth, so you aren’t accidentally duped. Sites such as Kelley Blue Book or Edmunds can help you figure out the going rate for your ideal car. After you’re armed with this information, compare prices at different car dealerships in your area. And don’t forget to check dealer incentives and rebates to get the best possible price.

By following these steps, you’ll be ready to make the best financial decision when getting a car loan. Even if you aren’t ready to buy a car right now, it doesn’t hurt to be prepared. Start by acquiring a free copy of your credit summary.

It is always a good idea to pull your credit reports each year, so you can make sure they are as accurate as they should be. If you find any mistakes, be sure to dispute them with the proper credit bureau. Remember, each credit report may differ, so it is best to acquire all three.
If you want to know what your credit is before purchasing a car, you can check your three credit reports for free once a year. To track your credit more regularly, Credit.com’s free Credit Report Card is an easy-to-understand breakdown of your credit report information that uses letter grades—plus you get a free credit score updated every 14 days.

You can also carry on the conversation on our social media platforms. Like and follow us on Facebook and leave us a tweet on Twitter.

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Source: credit.com

25 Things You Should Never Buy — and What to Buy Instead

Unhappy shopper
Take A Pix Media / Shutterstock.com

American consumers are swimming in sea of products. Any need, want or whim can be met with a quick trip to the mall or click of a keyboard.

In this retail wonderland, it’s easy to make a few mistakes.

We’ve all fallen victim to aggressive marketing and been lured in by budget-busting convenience products, impulse buys and things that simply don’t make sense. (That reminds me, does anyone want a gently used Shake Weight?)

If you want to save money, it’s time to become a more intentional consumer. Following is a look at some of the things you should never buy — and what to buy instead.

1. Flushable wipes

Yevhen Prozhyrko / Shutterstock.com

Marketed as a step-up from toilet paper, adult wet wipes are another product innovation that we didn’t need.

Besides being far more expensive than traditional toilet paper, these “flushable” wipes are anything but (pun intended). They’re nonbiodegradable and wreak havoc on plumbing and sewer systems, as we report in “9 Things You Should Never Flush Down a Toilet.”

The bottom (ahem) line? Save your money, save your pipes and stick with traditional toilet paper. If you just can’t live without a moistened wipe, consider a toilet tissue spray. Amazon has multiple options to choose from.

2. Baby shoes

Mom and baby
Julia Zavalishina / Shutterstock.com

I get it: Baby shoes are adorable. Their cuteness factor ranks right up there with puppies in Halloween costumes. But since babies don’t walk, investing in fabulous footwear for them doesn’t make sense.

Instead of buying those itty-bitty Adidas, direct that money toward something with real traction. Invest in a college savings plan, buy a savings bond or stop by our Solutions Center and find a great savings account to open in your baby’s name.

3. Bottled water

nenetus / Shutterstock.com

According to the Mayo Clinic, bottled water and tap water generally are comparable in terms of safety.

If you’re concerned about the purity of your local tap water, invest in a faucet-mounted or under-sink filtration system, or a simple pitcher filter. Any of these options is far more convenient than lugging home cases of bottled water every week from the store.

And by keeping a few reusable water bottles on hand, you can still stay hydrated on the go.

4. Natural diamonds

Couple Engagement
YAKOBCHUK VIACHESLAV / Shutterstock.com

Diamonds have an undeniable emotional appeal. And couples are willing to pay up for these symbols of love.

But thanks to new technology, lab-grown diamonds might give natural stones some serious competition, since they cost as much as 50% less.

Make no mistake, these stones are nothing like the much-maligned cubic zirconia. In fact, they’re so similar to mined diamonds that gemologists often have a difficult time distinguishing the two, as we report in “3 Reasons Lab-Grown Diamonds Are Better Than the Real Thing.”

Lab-produced diamonds are also more environmentally friendly than mined diamonds, and you won’t have to worry about whether you unwittingly bought a conflict diamond.

5. Scented trash bags

SpeedKingz / Shutterstock.com

Garbage stinks. Literally. But scented trash bags aren’t the answer.

Instead of eliminating odors, they mask them with artificial — and often overpowering — scents. The result? Your trash can smells like a weird potpourri of garbage, pumpkin spice and vanilla.

Skip the expensive scented bags and buy basic can liners or reuse plastic grocery bags.

To eliminate bad smells, try this DIY solution: Fill a disposable coffee filter with baking soda, tie it shut with a twist tie or dental floss, then place in the bottom of your trash can. This homemade sachet will absorb odors for weeks.

6. Retail-priced greeting cards

birthday cards
Niloo / Shutterstock.com

I prefer to skip greeting cards altogether and make a good old-fashioned phone call to the person I’m thinking of. If that’s not your style, consider some other budget-friendly options:

  • Cheaper retail cards: Dollar stores have a decent selection of cards for — you guessed it — $1 or less.
  • Thrift store cards: Many thrift shops offer single and bulk greeting cards at amazing prices. A little shop near me sells individual cards for only 10 cents.
  • DIY cards: Get creative and make your own greeting card. As always, Pinterest has loads of great ideas to get you started.
  • E-cards: Send a free digital card using a service like Ojolie or Open Me.

7. Class rings

Margaret M Stewart / Shutterstock.com

During my senior year of high school, choosing and comparing class rings was the social activity of the year. But if you ask me where that $250 ring is today, I couldn’t tell you.

Class ring manufacturers rely heavily on peer pressure and sentimentality to market their wares. In exchange for hundreds of dollars, unwitting students get a bit of gold, a glass “gem” and a few weeks of giddy anticipation. But these expensive souvenirs become irrelevant in a matter of months.

If your graduate is open to the idea, suggest marking the milestone a different way. Plan a celebratory dinner, coordinate a day trip or purchase something that will make the next phase of life easier — maybe a new laptop or down-payment on a good used car.

8. Mr. Clean Magic Erasers

Bykfa / Shutterstock.com

If you’ve ever used one, you know that Mr. Clean Magic Erasers live up to their name.

These wondrous little sponges are pure magic — and at $6.99 for a box of nine, they can even make your money disappear!

To avoid washing your hard-earned cash down the drain, there are generic versions of this miraculous household helper.

Skip the brand-name markup and look for any melamine sponge. Amazon has multiple options for a fraction of the price. You might even find some at your local dollar store.

9. Keurig cleaner

Coffee mug
Anutr Yossundara / Shutterstock.com

From coffee pod organizers to customized scoops, Keurig coffee makers have spawned an entire industry of peripheral products.

Cleaning doesn’t have to be complicated or expensive. A 1:1 ratio of vinegar and water will clean single-cup and multi-cup coffee makers for pennies.

In fact, the many uses of vinegar will amaze you. It’s one of the most versatile and cost-effective products in your house, as we illustrate in “27 Money-Saving Ways to Use Vinegar in Every Room of Your Home.”

10. Paper plates

RosieYoung / Shutterstock.com

Using paper plates for every meal in order to avoid washing dishes is a growing — and slightly disturbing — American trend. Sure, doing dishes isn’t my favorite activity, but neither is budgeting for disposable dinnerware every month.

So, how do you solve the daily dish dilemma? Buy some inexpensive plates and bowls that are easy to clean. (Hint: Avoid anything white.)

Then, get the whole family involved in after-meal cleanup. Assign each person a task, like clearing the table, washing or drying. At the same time, listen to music together, share details of your day, and make plans for tomorrow.

It may sound corny, but the job will be quick and nearly painless. Even better? You save a few trees and spend less “paper” on paper.

11. Electric can openers

Venus Angel / Shutterstock.com

Electric can openers may be necessary if you suffer from arthritis or another dexterity-limiting condition. But for most people, they’re conveniences that become very inconvenient when the power goes out.

Free up some valuable countertop space and save money, too. Skip the electric models and buy a well-made manual opener.

Though I’m a fan of vintage Swing-A-Way openers, OXO Good Grips makes a reliable, easy-to-use product.

12. Expensive wedding dresses

Wedding couple
Alex Andrei / Shutterstock.com

Few events in life spark emotional spending the way a wedding can, but it’s important to realize the day is about the shared experience, not the price of the dress.

Don’t stress your new marriage with wedding dress debt. Consider buying a pre-owned gown at a consignment shop, choosing a less formal dress from a discount store like T.J. Maxx or exploring other ways to pay less for your wedding dress.

13. Flossers

Dan Race / Shutterstock.com

Sometimes, a product innovation is more hype than substance. Handled flossers are a perfect example.

Though great for teaching kids how to floss, these devices are far more expensive than spooled floss, which is also better for the environment.

14. Sandwich bags

Laura Riquelme / Shutterstock.com

Isn’t buying something designed to end up in the trash the very definition of throwing your money away? It’s time to embrace a greener and more economical alternative to plastic sandwich bags.

Instead of paying for an endless stream of disposable plastic, invest in few reusable containers. Plastic, glass and even stainless steel options are available. Because these containers generally have air-tight seals, your food is likely to stay fresher. And washing is a snap.

15. New cars

Soloviova Liudmyla / Shutterstock.com

I’m not sure who said “never buy a new car if you want to be a millionaire,” but it’s an adage I live by.

You’ve heard the figures before: According to Carfax, new cars depreciate 20% in the first 12 months of ownership and roughly 10% in each of the four years thereafter.

Why buy anything that’s worth 20% less the minute you take it home? Let someone else shoulder the burden of that first big drop in value. Buy used instead.

By following a few basic steps to buying used, it’s possible to find a reliable vehicle that’s still under warranty, has excellent safety ratings and gets decent gas mileage.

16. Instant microwaveable rice

DONOT6_STUDIO / Shutterstock.com

Sure, precooked rice in a bag is quick and convenient, but it comes at a steep price.

Why pay several times more than you need to for a pantry staple? Stick with traditional rice — it’s incredibly simple to prepare. And if you have an electric steamer, you can set it and forget it.

17. Paper towels

Couple using paper towels
LightField Studios / Shutterstock.com

I know — suggesting that busy families forgo the convenience of paper towels borders on blasphemy. But there’s logic behind it.

Let’s assume you buy paper towels for the bargain price of $1 per roll. If you use two rolls a week — not unrealistic — you’ll spend $110 a year on something that’s just thrown away.

What’s a practical alternative? Hand towels. Change them often, wash with bleach and voila! You’ve done a solid for your budget and the environment.

18. Mass-produced souvenirs

Paris travelers
Song_about_summer / Shutterstock.com

When I was a kid, my parents planned elaborate two-week-long vacations each year. By age 12, I had a box full of refrigerator magnets, keychains and little metal nameplates. Though these items felt meaningful at the time, I seldom thought about them once the vacation was over.

Instead of loading up on tchotchkes when you travel, invest in new experiences.

Indulge in the local cuisine, plan outdoor adventures and connect with the people who make the place special. The best souvenir is returning home happily exhausted with a suitcase full of wonderful memories.

19. Subscription boxes

tommaso79 / Shutterstock.com

While streaming music and video subscriptions can often be more economical than buying or renting, subscription boxes — think meal kits, wine, shaving supplies and pet supplies — are often a slow-bleed on budgets.

Here’s the problem: Subscription box services charge us to deliver goods on a regular basis — whether we need them or not. And since payments are made via credit card or automatic deduction, we hardly notice.

Don’t need another box of razors right now? Too bad. You got it, and you’re paying for it.

Instead of signing of up for yet another thing-of-the-month, buy what you need as you need it. Better yet, stock up on items you know you’ll use at discount retailers or when the items are on sale.

20. Pre-cut produce

A senior couple cuts vegetables for a salad while cooking a meal in their kitchen
Prostock-studio / Shutterstock.com

Every processing step added to the sale of produce increases its price. Sure, pre-cut carrots, diced onions and shredded cabbage look enticingly convenient when you’re exhausted and hungry, but you’ll pay heavily for all that pre-prep.

According to a comparison done by Vice, the average consumer could save $100 each month by skipping all pre-cut and prepackaged produce. That’s some serious cabbage.

Lettuce (sorry) explore another way: Buy fruits and veggies whole and reserve about 30 minutes after shopping to wash, chop and store enough produce for several days. Seal everything in airtight containers and pop in the fridge.

21. Gym memberships

A woman exercises with dumbbells
goodluz / Shutterstock.com

Joining a gym always seems like a great idea at the time, but then life gets in the way.

When you factor in driving to the club, changing, showering, dressing and driving home, there’s not much time left for working out. Perhaps that’s why Americans waste $1.8 billion on unused gym memberships each year.

Thankfully, there are many ways to burn calories without the gym. Remove a few of the logistical hassles by investing in at-home exercise equipment.

Quality used equipment can often be found on Craigslist, Facebook Marketplace and even secondhand shops for a fraction of the retail price. Short on space? Some machines fold up for easy storage under the bed or in a closet.

22. Dryer sheets

wavebreakmedia / Shutterstock.com

Dryer sheets are coated with stearic acid or other fatty acids, CNET reports. In the heat of the drying cycle, these acids melt and coat the fibers of your clothing to increase softness and decrease static cling.

But dryer sheets have a few unintended consequences. The acids also:

  • Make towels less absorbent over time.
  • Reduce the wicking effect of activewear.
  • Make some pajama fabrics less fire-resistant.

Wool dryer balls are a safe, reusable alternative to dryer sheets. You can find them in many grocery stores and online.

In a pinch, aluminum foil reduces static cling, too. Just crumple a strip of foil into a ball about the size of a tennis ball and toss it into the dryer with your laundry. You’ll be surprised by how well it works.

23. Purebred pets

pet sitting
Josep Suria / Shutterstock.com

Because they lack genetic variation, purebred pets are prone to multiple health challenges. According to the nonprofit PETA, purebred dogs are often susceptible to a wide range of problems, such as skin allergies, heart valve defects and glaucoma.

Besides the higher upfront cost of buying an exclusive breed, owners will likely have to shoulder a hidden cost: expensive vet bills to manage chronic conditions.

Instead of buying a purebred pet, consider adopting a rescue from your local shelter. Generally, adoption fees are nominal when compared with the prices breeders charge.

Though these rescue animals may not have the noble lineage of a purebred, they’re in desperate need of a loving home and, I believe, never forget the second chance they’re given.

24. Checked baggage

Vietnam Stock Images / Shutterstock.com

While technically not something you buy, airline fees for checked baggage are still budget-busters. According to Kayak, some airlines charge up to $80 for a traveler’s first checked bag, and rates may increase for each additional piece checked.

If you’re tired of this “gotcha” fee, invest in a well-designed, small, soft-sided bag and versatile clothing items. You can travel in comfort with only a carry-on.

I’ve been doing it for years, and Money Talks News founder Stacy Johnson details his own secrets in “Ask Stacy: How Can You Go to Europe for 10 Days With Just a Carry-On?”

Besides being a money-saver, single-bag travel is a smart strategy. When you have no luggage to reroute, gate agents might be more likely to work with you on last-minute flight changes. Even better: No more fighting crowds at the baggage carousel.

25. Ringtones

online
pickingpok / Shutterstock.com

Paying for a ringtone? Really? Every purchased ringtone should start with a melodic “cha-ching” — that’s the sound of money leaving your wallet.

My 6-year-old smartphone came with 35 ringtone options. I picked the least offensive option and never thought about it again.

Select a factory ringtone or for more options, download a free ringtone app like Zedge or Audiko.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Source: moneytalksnews.com

Unplanned Road Trip Planning As A Freelancer With Dogs Part 2

Unplanned Road Trip Planning As A Freelancer With Dogs 1

Unplanned Road Trip Planning As A Freelancer With Dogs 1Hello! Today, I am publishing Part 2 to my post from yesterday Unplanned Road Trip Planning. As a recap, we left our house on Wednesday and we are not sure when we will be going back.

This will probably be a 10 to 14 day road trip. This is nothing crazy, but it is more than what we usually do. Some of you who are truly location independent are probably laughing at me. I am such a homebody though!

I do miss my bed, but we’re having a lot of fun on this road trip. Below is an update/recap of different parts of our trip.

How’s it like working on the road and being location independent?

Okay, okay, I know it’s only been since Wednesday that we haven’t been home. However, it feels like it’s been forever! Luckily we have been at a hotel since Saturday at 6 a.m., but on Monday we left the hotel life and we plan on camping the next few days.

I’m not going to lie, I still have to work, so the first thing I did was to see if there was a Starbucks near our first camping location. And WOOHOOO because there is one just a few miles away from our camping spot.

I have done most of my work ahead of time though (I worked like crazy last week). So, if anything does come up, it will just be extra work.

Freelancing and being on the road is a little difficult though. It’s hard to stay on task because Colorado is so beautiful. I have been buckling down at night time though and in the early mornings to get work done.

Usually when I am at home, I am online pretty much all day long whenever I am awake, so only being able to be online when I can find internet is something new…

Unplanned Road Trip Planning As A Freelancer With Dogs 5Where are we staying?

Before last week, I never camped before. We started our trip by driving out to Wes’s family’s property (tons of acres, there’s a really pretty creek, and more) and camping out there for two nights.

We left on Friday evening and arrived in Denver around 6 a.m.

From 2 a.m. to around 6 a.m., I spent my time frantically calling hotels within a two hour radius of Denver, and literally every single hotel and motel was booked besides ONE. We even stopped by some extremely sketchy motels (I’m talking $20 a night run-down motels on the side of the road), and even those were booked. We were just so tired and didn’t think it would have been that hard to find a place to sleep.

We finally found a hotel (Crowne Plaza). They even let us check in early without paying a fee, and didn’t make us pay any extra fees for our dog as well. They said we were lucky because it was the only open room they had. Apparently there were a lot of plane delays/cancellations the day that we got there, so that was why everything in the area was completely booked.

Then, on Sunday we left Crowne Plaza and we went to a La Quinta in Silverthorne, Colorado.

For most of the rest of the trip, we plan on camping at campgrounds. I have never done this before, so this will be interesting! We raided REI the other day and bought every single thing that we need. Also, some people bought items from REI from our wedding registry, so that really helped out as well.

We have been thinking more and more about possibly renting an RV, buying a pop-up camper or doing something else along those lines for our next trip. There are still a lot of other areas that we want to visit in the United States, and having a camper or RV would make things 1,000 times easier. Anyone have any tips on this? Or is this a dumb idea?

What about driving in a Jeep Wrangler?

A Jeep Wrangler is not usually everyone’s top pick for a car when going on a road trip. There are two main reasons for this: gas mileage and it’s a rough drive.

The gas mileage is HORRIBLE! Our Wrangler gets between 15 to 19 miles per gallon. Not exactly the most eco-friendly.

Driving in a Wrangler can also be rough, especially when over a long distance. It’s LOUD, and it’s not very big. We had to take out the back seat and have made a science out of perfectly stacking our bags and camping gear so that our dogs can have as much space as possible. There’s still a lot of room back there for them – they can both sprawl out and sleep.

Even with the negatives, it is nice driving with the wrangler. If we didn’t have the dogs with us, then there would be plenty of room. Also, we like to drive on off-road trails and the Wrangler is perfect for that.

Unplanned Road Trip Planning As A Freelancer With Dogs 4How are our dogs doing?

Our dogs are doing really well. This isn’t their first road trip though. We took them with us to our Gulf Shores (also around 12 hours from our home) trip last year, and they also accompany us whenever we drive to hike or walk on trails near our home.

Whenever we hop in the car, they almost always immediately go to sleep, which is very nice because that must mean that they are comfortable in the car!

We haven’t left them alone at all, and we don’t plan on doing that as well. They are going to be with us the WHOLE time, because we are crazy dog people and we love them.

We have a folding water bowl for them, so we can give them water whenever they need it. We also make sure to make plenty of stops so that they can stretch their legs and use the bathroom.

Also, trying to find a pet friendly hotel hasn’t been too bad. Super nice hotels, of course, won’t let us in, but we’ve not having any problem with other hotels. Our bigger dog isn’t allowed at some because of her weight (many have weight limits of 30 or 50 pounds), but we still were able to find hotels to call home for a few nights.

Do you want to be location independent one day? Do you like to camp?

Do you think being an online freelancer and camping is crazy? Haha! 

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Source: makingsenseofcents.com

7 Small Ways to Save Big on Gas

7 Small Ways to Save Big on Gas – SmartAsset

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Gasoline can get expensive, but most of us have to drive at some point or another. Driving around to find the cheapest gas  in town is one way to cut a big chunk out of your monthly gas bill. But there are many tips and tricks that can reduce what you pay at the pump. Here are seven strategies that can help you save money on gas and reduce your environmental footprint.

See what the average budget looks like for someone in your neighborhood.

1. Service Your Vehicle Regularly

Properly maintaining your vehicle can improve its fuel economy. You’ll need to replace dirty filters as often as possible and use the right motor oil whenever you top up. Using the wrong oil could waste gas by making your engine work harder. If you aren’t sure which grade of motor oil your car needs, you can check your owner’s manual.

It’s also important to keep your tires properly inflated. Tire pressure should always remain at the level recommended by your car’s manufacturer. And you’ll need to make sure your tires are aligned. When it comes to gas mileage, a simple tune-up can go a long way.

2. Use A/C Wisely

In some cases, you can waste gas by cranking up the A/C. But it all depends on where you’re driving. If you’re driving fast because you’re on the highway, for example, having the windows open can increase drag and reduce fuel economy. So using A/C when you’re speeding down the freeway won’t prevent you from trying to save money on gas.

In most cars, the A/C turns on when you try to defrost the windshield. Using a less powerful setting is one way to avoid wasting energy.

3. Find Cheap Places to Fuel Up

Generally to find cheap gas, you’ll need to stay away from wealthier neighborhoods and check out stations in the suburbs if you’re driving through a major city. Apps like GasBuddy, AAA TripTik Mobile and Waze can help you find low gas prices in your area.

If you’re trying to spend less money on gas, waiting until your gas tank is empty and filling up a little at a time throughout the week isn’t a good idea. In fact, doing that could damage your car. It’s best to wait until you have a quarter tank of gas and fill it up all the way.

Related Article: States With the Worst Drivers

4. Earn Rewards for Buying Gas

If you drive a lot, it may make sense for you to get a credit card that rewards you with cash back or points for buying gas. Depending on the kind of credit card you qualify for, you could earn gas rewards of up to 5%.

5. Travel Lightly

Carrying around a heavy load can add unnecessary drag. That’s why it’s a good idea to clean out your trunk and remove anything from your roof that you don’t need. By removing excess weight, you’ll be able to maximize your vehicle’s fuel economy.

6. Drive Slower

Cars often use more gas when drivers speed up. Exceeding your car’s optimal speed can reduce your gas mileage. In many cars, it’s best to drive at around 50 mph if you want to save fuel.

When you need to accelerate, it’s best to tap the gas pedal lightly. Speeding up too quickly or hitting the brakes too hard can reduce your miles per gallon.

Related Article: How to Trade in a Car

7. Drive More Efficiently

In addition to monitoring your speed, you can drive more efficiently by paying attention to details. For example, it’s a good idea to turn off the engine if your car has been idle for a while. Avoiding potholes and sudden stops can also make a difference when you’re trying to save money.

Using cruise control while you’re driving long distances may also help you use less gas. If you want to go the extra mile, consider buying a more fuel-efficient car. Spending a bit more on a new ride might make sense if you want better gas mileage.

Final Word

Sometimes you have to get creative when you want to cut costs. By making some adjustments to the way you drive and maintain your car, you can save big bucks on gasoline.

And if you can capitalize on the best times to buy gas, you probably should. Usually, it’s best to get gas either early in the morning or late at night.

Photo credit: ©iStock.com/CasarsaGuru, ©iStock.com/Geribody, ©iStock.com/Kesu01

Liz Smith Liz Smith is a graduate of New York University and has been passionate about helping people make better financial decisions since her college days. Liz has been writing for SmartAsset for more than four years. Her areas of expertise include retirement, credit cards and savings. She also focuses on all money issues for millennials. Liz’s articles have been featured across the web, including on AOL Finance, Business Insider and WNBC. The biggest personal finance mistake she sees people making: not contributing to retirement early in their careers.
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Source: smartasset.com