US mortgage rates are forecast to be higher than expected in the coming year, according to Goldman Sachs Research. Home prices are also projected to increase, even as borrowing costs remain elevated.
As interest rates have risen, 30-year-mortgage rates are now expected to be 7.6% at the end of 2023, up from the previous estimate of 7.1%, Goldman Sachs Research analysts Roger Ashworth and Vinay Viswanathan write in the team’s report. Similarly, the forecast for rates at the end of 2024 now stands at 7.1%, up from 6.8% previously. At the end of 2025, rates are predicted to be 6.6%.
The new forecast for mortgage rates reflects a steeper yield curve (longer-maturity Treasury yields are rising, which tends to increase mortgage rates) and Treasury yield volatility that remains “stubbornly high,” according to Goldman Sachs Research. The latter is keeping spreads (the extra interest a security yields relative to risk-free Treasuries) for mortgage-backed securities wide and is raising funding costs for mortgage originators. Over the past six months, the secondary market for MBS has begun to price in mortgage rates that stay “higher for longer.”
US home prices are forecast to climb
Meanwhile homes have appreciated despite the rise in borrowing costs: Prices grew in August by 0.9% month-over-month, reflecting an annualized 11% pace, according to Case-Shiller data. “The continued strength of the data surprised us,” Ashworth and Viswanathan write. Goldman Sachs Research expects home prices, adjusted seasonally and accounting for the full year, to appreciate 2% in 2023, 1.9% in 2024, and 2.8% in 2025.
Home prices have been buoyant amid tight supply. When it comes to existing homes, the inventory available for sale is historically low. New listings are being added at the slowest pace on record. And while new home inventory continues to rise statistically, most of this new inventory is still under construction.
Persistently higher interest rates are expected to dampen mortgage origination. Our analysts forecast $1.5 trillion in mortgages will be originated in 2024 — a figure similar to their full-year projection for 2023 — before rising slightly to $1.8 trillion in 2025. Meanwhile homeowners looking to sell their houses and buy new ones face the daunting prospect of having to prepay their current mortgages and take out fresh mortgages at today’s higher rates. This “lock-in” effect is projected to depress sales of existing homes to 3.8 million in 2024, the lowest level since the early 1990s, according to a separate report from Goldman Sachs Research.
US housing has become much less affordable
“An unfriendly byproduct of our forecasts for resilient home prices and limited rates relief is enduringly poor housing affordability,” Ashworth and Viswanathan write. The Goldman Sachs Housing Affordability Index touched a record low in late 2023, and is expected to improve only gradually over the next three years.
Affordability issues could explain why rent growth has been stronger than home price growth over the past 12 months, based on Zillow estimates. The payment gap between new mortgages and new rental leases has grown considerably across geographies (largely a function of mortgage rates), potentially encouraging first-time homebuyers to hold off purchasing a home.
“While rental affordability is also challenging in absolute terms, the stark deterioration in mortgage affordability has made renting more compelling for potential homeowners,” Viswanathan writes in a separate report.
This article is being provided for educational purposes only. The information contained in this article does not constitute a recommendation from any Goldman Sachs entity to the recipient, and Goldman Sachs is not providing any financial, economic, legal, investment, accounting, or tax advice through this article or to its recipient. Neither Goldman Sachs nor any of its affiliates makes any representation or warranty, express or implied, as to the accuracy or completeness of the statements or any information contained in this article and any liability therefore (including in respect of direct, indirect, or consequential loss or damage) is expressly disclaimed.
If sky-high house prices and mortgage rates have made you hit pause on your home buying plans, you may want to think again, or so says personal finance personality Dave Ramsey.
The average 30-year fixed mortgage rate increased to 7.79% last week — up from the prior week’s average of 7.63% — and hitting (another) highest level since 2000. At the same time, house prices continue to rise, primarily due to low inventory.
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“[House] prices aren’t going to go anywhere but up, even with interest rates going up,” Ramsey said on a recent episode of “FOX & Friends.”
“The housing market is just stalled and, man, we’ve got Bloody Sunday with the student loans kicking back in [as of Oct. 1] and Christmas is bearing down on us so it is time to get on a budget and get on a plan.”
With that in mind, Ramsey says you shouldn’t sit back and wait for conditions to improve — reminding potential buyers that you can always refinance your home loan to get a better rate down the road. In fact, if you meet two criteria — “you’re out of debt and you’ve got your emergency fund” — Ramsey suggests going for it now.
Here’s how you can hit Ramsey’s critical financial conditions to buy your dream home — plus some other ways to invest in real estate while dodging housing market headwinds.
Become debt free
Ramsey was joined on “FOX & Friends” by his “The Ramsey Show” co-host George Kamel, who backed Ramsey’s bold housing call and mirrored his advice around becoming debt free.
“If you’re a millennial or you’re Gen Z, you’re feeling hopeless right now, you’re feeling cynical,” says Kamel. “Your parents are saying: ‘You’re throwing away money on rent, get a house, get a house, get a house’ — and you’re broke.
“You’ve got to have some patience because rent and mortgages are not apples to apples,” Kamel said, adding buying a home also comes with taxes and insurance — and in some cases, homeowners’ association fees and private mortgage insurance. All those expenses can add up, which is why the Ramsey camp argues it’s important to ensure you’re debt free with an emergency fund established before making an offer.
There are many different ways to handle debt, but in his well-known seven “baby steps” to financial success, Ramsey advocates for the snowball method. With this strategy, you pay off the smallest debt (or account with the lowest balance) first and make only minimum payments on all of your other outstanding debts. Once you’ve paid off your smallest debt, you move on to the next smallest debt, and so on.
But how much interest you end up paying on your debt is an important factor. If you’ve got a pile of high-interest debt on your credit card or your car loan, you could fall behind on your payments, be subject to financial penalties and your balance can quickly spiral out of control, making it even harder to get debt free. For you, it might make more sense to use the “avalanche method” of debt repayment, where you tackle the loan with the highest interest rate first and go from there.
Regardless, to succeed in this journey, you’ll need to stick to a budget that breaks down your monthly income into necessities, wants, savings and debt repayments.
Read more: Thanks to Jeff Bezos, you can now use $100 to cash in on prime real estate — without the headache of being a landlord. Here’s how
Build an emergency fund
Ramsey believes every adult American should have at least $1,000 set aside to cover life’s inevitable surprises, like you’re suddenly slapped with a big medical bill or your car breaks down. That back-up fund will stop you from falling into financial distress.
But that’s just meant to get you started. Once you’ve paid down your debts, Ramsey suggests revisiting your emergency fund to set aside three to six months worth of living expenses — including your rent or mortgage, other loan repayments, grocery and energy bills and other regular expenditures — to cover larger surprises like a job layoff or a long hospital stay.
Wherever you are on your savings journey, you might consider stashing some cash in a high-yield savings account (HYSA). With an HYSA, you could earn more interest on your money and benefit from greater compound growth than you would with a traditional savings or checking account.
You may also want to consider using other high-yield savings products like money market deposit accounts (MMDA) or a certificate of deposit (CD) to make the most of the current high interest rates. But remember that banks and credit unions will often charge an early withdrawal penalty for taking money out of a CD before its maturity date.
Other real estate options
Once you’ve hit those two financial milestones — paying down your debt and building an emergency fund — then Ramsey says you should go ahead and buy a house (if that’s what you want to do). But if you’re unconvinced, there are other ways to get a foothold in the real estate market without dealing with the extensive costs of homeownership.
For instance, you may want to consider putting your money in a real estate investment trust (REIT), which are publicly-traded companies that collect rent from tenants and pass that rent to shareholders in the form of regular dividend payments.
There are also online crowdfunding platforms that allow everyday investors to pool their money to purchase property (or a share of property) as a group.
If you don’t want to make investment decisions on your own, some new online platforms can even help you invest in diversified real estate portfolios that will maximize your returns while keeping your fees low.
What to read next
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
Wouldn’t it be great if we all had a crystal ball that told us what the interest rate environment would do? We could figure out the best time to get a mortgage or the best time to buy a car. And of course, we would know exactly when to put all of our money into certificates of deposit (CDs) to maximize our yield.Unfortunately, that isn’t the case. Nobody knows what interest rates are going to do in the future — not even the people in charge of setting benchmark interest rates. However, we can use the latest economic projections to consider the most likely scenario and what else could happen instead. So here’s what we know (and don’t know) about what CD yields will do in 2024.Where do CD yields come from?The short explanation is that CD rates are a combination of three main factors:The current interest rate environmentThe bank or financial institution that offers themThe maturity termIn other words, when benchmark interest rates rise, CD rates generally tend to rise along with them. However, the rates paid by CDs can vary dramatically between banks.For example, as I write this, our top 12-month CDs have APYs ranging from 4.25% to 5.65%. The same is true for CDs of other maturity lengths as well. But because the Federal Reserve has raised benchmark interest rates so aggressively in the past couple of years, this range is significantly higher than it was.When it comes to different maturity lengths, it’s a little tricky to explain, but the general idea is that shorter-term CDs tend to track benchmark interest rates rather closely. The current federal funds rate (the most important interest rate the Fed controls) is set to a range of 5.25% to 5.5%, and this is certainly aligned with most of the top 1-year CDs we track.With longer maturities, there are a lot of economic factors at work, but the simple explanation is that CD yields are a combination of the current interest rate environment and expectations for future interest rate movements. In most environments, longer-maturity CDs tend to have higher yields, since banks typically pay a premium if customers agree to leave their money on deposit for a longer time. But as of Oct. 2023, the range of 5-year CD yields on our top CD list is 3% to 4.85%, with the average yield significantly lower than the average 1-year CD.This makes sense. According to the latest projections from the policymakers at the Federal Reserve, the benchmark federal funds rate is expected to fall to 4.6% by the end of 2024 and to 3.4% by the end of 2025.What will CD rates do in 2024?There’s no way to predict with accuracy what CD rates will do next year. Even the Federal Reserve’s own projections can be very wrong. In fact, the Fed’s projections in Sept. 2021 called for a federal funds rate of just 1% at the end of 2023.Having said that, the latest projections call for one further quarter-point rate hike by the end of 2023, which would likely push CD yields slightly higher to start 2024. And if the Fed’s projection of a 4.6% federal funds rate proves to be accurate, we could expect 1-year CD rates to gravitate towards that level, with other maturity terms drifting generally lower as well.However, it’s tough to overemphasize that we don’t know what is going to happen. If inflation proves far more difficult to control than the Fed expects, it’s entirely possible that several more interest rate hikes will be needed and CD yields will be much higher at the end of 2024. On the other hand, there’s the possibility of a recession coming and the need for the Fed to aggressively cut rates if the economy takes a worse downward turn than expected.The bottom line is that CD rates are higher right now than they’ve been in a long time, and the best course of action is to put your money in CDs that make sense for you now — not to leave your cash on the sidelines in anticipation of rates rising even further.However, one smart strategy could be to create a CD ladder, which gives you the best of both worlds. If rates end up rising in 2024, you’ll end up with some money to take advantage. And if rates fall, most of your money will be locked in at today’s rates.
Costco Is Selling a Full Thanksgiving Meal Kit So You Don’t Have to Do a Thing
By: Maurie Backman |
Updated
Oct. 23, 2023 – First published on Oct. 23, 2023
Some people absolutely love hosting Thanksgiving and getting creative in the kitchen. But if you’re someone who dreads Thanksgiving and the hours upon hours of preparation that tend to come with it, then you may be in luck. Costco is selling a Thanksgiving meal kit for $199.99 that’s designed to feed a party of eight. You’ll need to pre-order yours by Nov. 5, but it could be worth it for the time-related savings involved. And you may even find that Costco’s Thanksgiving dinner kit saves you money, too.When you’re looking to outsource your Thanksgiving mealEven if you’re someone who likes to cook, being in charge of Thanksgiving isn’t easy. There’s a lot of pressure to throw together a massive feast, and you may not have the time or desire to spend an entire day preparing food. If you’re not at all looking forward to a day of cooking, let Costco come to your rescue. For $199.99, you’ll get the following:Five pounds of skin-on turkey breastA two-pound tray of stuffingA 1.5-pound trap for mashed potatoes with a side of gravyA 1.6-pound tray of macaroni and cheese A two-pound pack of sweet cornA two-pound pack of green beansCranberry relish12 dinner rollsOne pumpkin pieOne apple pieAll of this food will ship frozen, and you can expect delivery to your home between Nov. 8 and 17. Will Costco’s Thanksgiving meal kit save you money?You probably won’t save money by purchasing Costco’s meal kit compared to buying ingredients for the above dishes at Costco, or even elsewhere. At your local grocery store, turkey might cost about $3.50 per pound. So a five-pound turkey might cost you just $17.50. A Costco pumpkin pie, meanwhile, is generally only $5.99 (though prices can vary). So right there, you’re looking at $23.50 for 20% of your meal. The cost of the other items included in Costco’s Thanksgiving dinner kit can vary based on how you prepare your sides. But macaroni and cheese, for example, can be an extremely inexpensive dish to prepare. A single box of Kraft might cost under $1.50, so even if you need five boxes, you’re looking at $7.50 or less in total. (Of course, if you insist on making yours from scratch with high-end cheese, that’s a different story.)All told, you can probably throw together a Thanksgiving meal for eight for under $200 — but not so much under. So the question you’ll want to ask yourself is how much time you want to save.Also, if you’re so not looking forward to cooking to the point where you think you’ll pay to cater your Thanksgiving dinner, then you’re likely to put more than $200 on your credit card by going that route through a local restaurant or caterer. In that regard, Costco’s offering could save you some money.All told, Costco’s Thanksgiving dinner kit may be worth considering if you’re not excited to cook for the holiday this year. But chances are, this meal kit is going to be a popular item, which means it may sell out soon. If you are interested in ordering it, do so quickly so you don’t miss out.
3 Costco Perks You Aren’t Taking Advantage of — but You Should
By: Brittney Myers |
Updated
Oct. 23, 2023 – First published on Oct. 23, 2023
Just $250 a month at Costco would earn enough back to pay for the upgrade. In other words, if you spend more than $250 a month at Costco, upgrading makes financial sense.If that sounds like a ton of money to you, then definitely stay with your regular membership. But if your family goes through Kirkland Signature toilet paper like they flush it down the toilet, and you’re one of the people who actually finishes that 3-liter bottle of olive oil, then a membership upgrade could be a smart idea.Double up with rewards cardsWhether an Executive membership is right for you or not, there’s another way to earn rewards that everyone should be taking advantage of: rewards credit cards.Unfortunately, you can only use Visa credit cards in a Costco warehouse. If you’re shopping at Costco.com, you can use Visa or Mastercard credit cards. While these restrictions certainly stymie some of my favorite rewards cards, you’re not completely out of luck. There are still some great options from either issuer. Costco even offers its own cobranded Visa card, which can be especially rewarding when it comes to gas purchases. I prefer to use my Chase Freedom Unlimited®, however, for 1.5x points per $1.
I Bought a $278.99 Walmart Mattress. Here’s How It Compares to My Expensive Tempur-Pedic
By: Christy Bieber |
Updated
Oct. 27, 2023 – First published on Oct. 27, 2023
Recently, we bought a mattress that we plan to use temporarily for a few months as most of our furniture is in storage while we complete a remodeling project. We didn’t want to spend a lot of money since this mattress will be relegated to a guest room, if it is used at all, once we get our furniture back in place.We opted to buy a memory foam mattress from Walmart and paid $278.99 for a king size. This was a fraction of the cost of our regular mattress, which is a Tempur-Pedic that cost several thousand dollars.After sleeping on the cheap mattress for a while, here’s how they compare.Both are equally comfortableFirst and most importantly, my husband and I have found that both of the mattresses are equally comfortable to sleep on. Both provide a similar level of firmness and support. And, we don’t feel the other person moving around in either bed. In fact, if forced to pick which of the two we like better, we would not be able to based on the comfort factor alone.Both have the same warrantyOur Tempur-Pedic mattress came with a 10-year warranty. We didn’t expect our new bed to offer this same guarantee since it cost so much less. But, we were wrong. The new, inexpensive mattress also has a 10-year warranty and a 30-day refund policy to make sure we’re comfortable with it.Both have multiple layersOur Tempur-Pedic came with multiple different layers of material including a comfort layer on the top, a support layer in the middle, and a base layer. Each of these layers is supposed to serve a purpose, like distributing body weight evenly along the mattress or dispersing heat.Our inexpensive mattress actually comes with more layers, referred to as the “five floors of comfort.” There’s a top breathable fabric, a second layer to avoid heat, two separate support layers, and a non-slip layer at the bottom.I’m not exactly sure if all of these layers are serving their exact purpose, but I have noticed that neither bed sleeps warm and both feel like they provide adequate support. The non-slip layer on the cheaper mattress also seems to help it stay in place on my box springs.The Tempur-Pedic feels heavier and more substantialThe Tempur-Pedic stands out by feeling more substantial. The cheaper mattress came vacuum packed in a tiny little package and it took a while to fluff up. And it just doesn’t have the same heft as the Tempur-Pedic mattress.However, while this is a point in the Tempur-Pedic’s favor because the substance has me feeling like it may last longer, it also means the Tempur-Pedic is more of a pain to move around.Ultimately, I feel like the cheaper mattress was a better buy. It left more money in my bank account than the Tempur-Pedic, and it provides a similar level of comfort as well as the same warranty.The experience has shown that buying a more expensive bed isn’t always the best option, so before breaking out your credit cards, be sure to explore and fully compare different mattresses to find one that feels the best at a fair price. Visit some stores and try them out. Don’t immediately dismiss one just due to a lower price point, as you might miss out on a comfortable mattress at a great discount. And don’t forget to consider the return policy and warranty so you end up happy with your purchase in the long run.
Mark Cuban Thinks You Should Buy a 2-Year Supply of Toothpaste. Here’s Why
By: Christy Bieber |
Updated
Oct. 27, 2023 – First published on Oct. 27, 2023
Mark Cuban is the owner of the Dallas Mavericks and is well-known for his business skills and investing prowess. Over the years, he has provided some tips to others who want to get rich, and one of them was a pretty surprising one.His advice: Buy a two-year supply of toothpaste. Here’s why the billionaire suggested making this unconventional move.Cuban has a simple reason for buying so much toothpasteMark Cuban doesn’t just want your teeth to be really clean. He had a good reason for suggesting purchasing such a large stockpile. Specifically, he advised doing this if you use the same brand of toothpaste regularly and can find it at a deep discount.”If we, hopefully we’re all using toothpaste every day, right, couple times a day, and we’re gonna go through toothpaste every month, whatever it may be, you’re better off buying two years’ worth of toothpaste when it’s on 50% discount,” he said. “That’s an immediate return on your money.”Cuban’s point was that the prices of items go up over time, so you’re better off purchasing them at the lowest possible price as this puts guaranteed money in your pocket. You also immediately benefit from the savings since you get to spend less now and in the coming years, keeping more cash in your bank account.Toothpaste isn’t the only item Cuban believes you should stock up on. “Any of your reusables, consumables that you have to have, when they’re on a huge sale on Amazon, buy them, because chances are, their prices are gonna go up, but that’s a real savings that you get to put in your pocket.”Cuban said that while it can feel difficult to make a profit by investing in a brokerage account, this is a simple step that anyone can take that will have an immediate positive impact on their personal finances.Should you follow Cuban’s advice?Listening to Cuban just makes good sense — especially as the recent few years of rising prices and surging inflation have demonstrated that routine products and services that we use every day can and do see big price increases.If you’re able to get many of your consumer products at discounted prices, this can make a noticeable difference in your personal finances. It’s not difficult to do either. Most stores put items on sale on a predictable schedule, such as marking down a product once every six or eight weeks. If you can stock up when there’s a good price — and especially if there’s a deep discount, then you’ll be able to slash what you spend on groceries and personal care.Use this extra money wisely to do things like repay debt or invest for your future, and you will end up being able to build wealth without changing your lifestyle at all. But, no matter what you do with the money, you probably have better stuff to spend it on than paying full price for toothpaste.
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Regarding lenders’ vociferous complaints about increased loan buybacks from Fannie Mae and Freddie Mac, FHFA Director Sandra Thompson said the regulator expects originators to deliver loans consistent with the guidelines. But, she added, the Enterprises must implement a fair, consistent, and predictable process for identifying loan defects and the appropriate remedies.
“After multiple years of record-high loan volume, we have seen an increase in the absolute number of repurchase requests – which is to be expected,” Thompson said at the Mortgage Bankers of Association conference in Philadelphia on Monday. “The good news is that there has been a large decrease in repurchase requests since their peak in early 2022, as the Enterprises have worked through loans originated during the refinance boom.”
Thompson said Fannie Mae and Freddie Mac have closely examined their existing processes and practices, including efforts to improve language in the selling guidelines and provide more consistent feedback to lenders on buybacks. The goal is to lead to less ambiguity in underwriting.
In addition, the FHFA is open to additional options that would ensure alternatives to repurchases are available and offered regularly. However, “work on this front remains ongoing,” according to Thompson.
“While many of the details remain in development, we are considering initiatives to test and learn from various options for performing loans with defects,” Thompson said. “Taken as a whole, we believe these are meaningful improvements to uphold quality control while ensuring high-quality underwriting.”
Freddie Mac on Monday said its research shows that purchase mortgages have 35% more incidence of defects than refinancings. It cited loans missing key documents or those with inaccurate income calculations as the top factors.
“To address these issues, Freddie Mac committed to enhance our communication, collaboration and feedback with our lenders and industry partners. We also committed to enhancing our own processes. We did both, and it is working,” the GSE said in a prepared statement Monday. “Non-Acceptable Quality rates on our incoming loans are approximately 30% lower than their peak. With it, repurchase requests are trending down to approximately 60% lower than their peak. Within that 60%, repurchase requests to vitally important small and community lenders are even lower, down 68%.”
Freddie said it has made strides for three reasons: because loan file quality from lenders has improved; the GSE itself has improved the quality control review function; and Freddie has also advanced policy changes “that will minimize instances where judgment must be applied in the underwriting process.”
In a statement following Thompson’s remarks on Monday, the MBA said it has “advocated strongly” for FHFA to address the rise in loan repurchase requests, especially for performing loans and those with relatively minor issues underwritten during the pandemic.
“We share FHFA and the GSEs’ goal of high-quality underwriting and will continue to work with them to ensure the rep and warranty framework is being applied in a balanced way, and that there are appropriate alternatives that lead to outcomes short of a repurchase request.”
Another trade group, the Community Home Lenders Association, weighed in on Thompson’s remarks.
“More balance in repurchase demands is needed to reduce disincentives for lenders to originate mortgage loans to underserved borrowers,” said Scott Olson, the group’s executive director. “It is also necessary to avoid steep and unnecessary losses lenders are experiencing from selling off performing loans in a market with skyrocketing mortgage rates.”
Inside: Looking for the best travel essentials? Look no further! This guide has everything you need to pack for a trip.
There’s no feeling quite like the thrill of embarking on a new adventure, and with these top-notch travel essentials, your journey is set to be an absolute blast!
These travel essentials play a crucial role in not just enhancing your travel experience but also in keeping your trip organized, efficient, and absolutely “funner”!
Prepare to soar into hassle-free travel filled with joy, convenience, and unforgettable moments.
Many of my readers diligently save for their vacation and sometimes forget the small details like – travel essentials.
Traveling can transform from a stressful ordeal into an exciting escapade when armed with these must-haves that smart travelers swear by.
So, buckle up for an exhilarating journey ahead, knowing you’re perfectly prepared to take on the world. Let the adventures begin!
What are Travel Essentials?
Getting back to travel? Isn’t it just lovely!
Well, travel essentials are your new best friend! Waves of seasoned globetrotters have prepared this special guide for your benefit.
These items qualify as essentials because they streamline the packing process, afford comfort while traveling, and add a dash of fun to your adventures.
Also, there are so many cool gadgets available now that make traveling seamless.
What things are essential for Travelling?
Before you head off on the trip of your dreams, pack the right travel essentials to maximize your fun!
Meds: Don’t forget your prescriptions and common medicines for allergies or pain. Remember, health first!
Travel Insurance: Give yourself peace of mind by buying travel insurance – especially if you are traveling internationally.
Travel Credit Card: Credit cards are a simple way to pay when traveling. Make sure you have no foreign transaction fees!
Document Copies: Keep digital copies of essential documents to minimize panic and ensure quick verification in case of loss. And share this with someone in case you lose your phone!
Joyous journeys come from well-prepared travelers!
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What are 3 items to take on vacation?
Embrace the exhilarating aura of preparing for your much-awaited vacation!
Tuning into your needs and wants as a traveler, three crucial items stand out as top priority:
Anti-Theft Bag: This is an ideal travel companion – it comes with built-in security features that keep your belongings secure, reducing the risk of theft during your travels. With advancements in fashion, you can now find stylish options with exceptional functionality, making them perfect for vacations where style and security are priorities.
eReader: like the Kindle Paperwhite, makes the perfect vacation companion as it combines the portability and weightlessness of a single book while providing the capacity to store thousands of novels for entertainment. Moreover, its adjustable light settings and long battery life facilitate reading during transit, whether it’s mid-flight or at night, without disturbing others – a luxury traditional books can’t offer.
Tech Organizer Case: ensures all essential tech accessories like cables, adapters, and devices are neatly organized and easily accessible. This not only eliminates the hassle of rummaging through your bag for a tangled cord but also helps to maximize the efficient use of space within the bag.
Remember, the key is to pack smart and embrace savvy travel essentials that optimize comfort and convenience!
Best Travel Essentials Everyone Wants
Planning for a trip often entails the excitement-charged task of selecting the right essentials to pack.
This section highlights the best travel essentials that everyone craves, from the appropriate attire to tech gadgets, that go a long way in enhancing convenience during your journey.
These items, carefully curated by experienced travelers, promise to make every trip, whether short or long, a hassle-free experience.
1. Apple AirTags
Get ready for your next adventure with a travel essential that’s as smart as it is useful – the Apple AirTag.
This tiny gadget can make your trips stress-free by preventing the harrowing instances of lost luggage.
As a modern-day traveler, you’ll love the security it brings to your journeys. Simply sync the AirTag with your ‘Find My map’ and place it in your luggage to keep track of your belongings from point A to point B.
Lost luggage is increasingly common, but with an Apple AirTag, you’re covered.
Don’t forget these handy AirTag holders!
2. Travel Backpack
A travel backpack is your next must-have travel essential!
It’s an easy and convenient way to keep all your essentials – think wallet, phone, keys, passport – in one place, and with some even featuring a built-in USB port, you’ll never run out of battery on the move.
Its versatility and functionality, such as several compartments for organization and a separate section for shoes, are just unbeatable. Seriously, these travel backpacks are way cooler than your backpack from high school!
3. Luggage Scale
Traveling soon? Don’t even think about neglecting the trusty luggage scale!
This small but mighty tool, loved by frequent travelers like us, is your ticket to a stress-free journey.
With this compact gadget, say goodbye to dreaded overweight baggage fees.
Pack it in your carry-on for on-the-go convenience and weigh it with precision every time. One of my best gifts ever!
4. Anti-Theft Bag
An Anti-Theft Bag offers peace of mind when traveling, with built-in safety features deterring theft. These bags aren’t just secure but also fashionable, which is perfect!
The locking zippers act as a deterrent against potential theft as they add an additional barrier of protection.
Moreover, the incorporation of RFID blocking technology in these bags ensures your valuable information stays protected. This technology prevents identity theft by safeguarding any object with an RFID chip, such as passports issued after 2006 and credit/debit cards, from being read through your bag.
While traditionally, anti-theft bags have been seen as lacking in style, new versions of these bags are coming up in several fashionable options. As stated, they are now available in various colors like navy, charcoal, merlot, and blush apart from the usual black.
5. Underwater Action Camera
As a travel essentials superstar, the Underwater Action Camera ensures you never miss capturing a thrilling aquatic adventure. Turning ordinary snapshots into extraordinary keepsakes, this camera becomes a must-have for wanderlust souls.
Remarkably sealed, this camera captures stunning photos even from underwater.
Perfect for beachy holidays, and even more beneficial for snorkelers and swimmers.
Get for a tech-free vacation!
Pro tip: Master using this camera during daylight for better results.
6. Bluetooth Earbud Transmitter – Perfect to Use Your Airpods Pro
Head off on your next adventure armed with the Twelve South Bluetooth Audio Transmitter. This coveted travel essential turns your flight into a personal cinema!
Its superb features include high-quality sound transmission, pairing capabilities with airplane TVs, and functioning as a headphone splitter.
Ideal for tech-savvy travelers and those who love using their own headphones.
7. External Portable Charger
Don’t forget your portable charger – it’s a true travel hero! Imagine never running out of battery while navigating unfamiliar territories or capturing memorable moments.
This external power bank ensures your devices always stay juiced up.
Lightweight and compact size
Fast-charging capability
Can charge multiple devices at once.
Expert tip: Choose a charger that can power your device type at least 4x from zero battery.
8. Lightweight Luggage
Investing in lightweight luggage helps travelers avoid excessive baggage fees.
This is what we did over ten years ago and I can truly say we have saved thousands of dollars.
Look for luggage that weighs less than ten pounds. With most airlines capping luggage weight between 40-50 pounds that gives you 30-40 pounds of your stuff that you can pack.
While it is an upfront investment in new luggage, you will significantly reduce the risk of incurring additional fees.
9. Travel Wallet
This is something I picked up right before my last flight (teal of course)! I loved it because it was lightweight and compact size for easy carrying. Even in my yoga pant pocket!
Heald exactly what I needed with organized compartments for ID, cash, and credit cards
Sleek design that suits any style
RFID protection to keep your information safe
Travel wallets are perfect for minimalist travelers who love simplicity and security.
Learn how much cash can you fly with. It is more than your travel wallet!
10. Passport Holder
A passport holder: the travel essential you never knew you needed.
It’s the perfect companion for safeguarding your most priceless travel accessory – your passport.
Super convenient, passport holders come equipped with slots for important IDs, boarding passes, and even stashed currency.
The RFiD-blocking feature ensures your personal details remain secure from potential scams.
If you are traveling internationally, then this is something you want to seriously consider.
11. Tech Organizer Case
It’s a must-have to neatly stash all your tech essentials. Never be frazzled by tangled cords or lost chargers again.
The Tech Organizer Case, like the top pick FYY Electronic Organizer, is your ultimate travel buddy ensuring a clutter-free trip.
Ample space for multiple chargers, durable, and easy-to-use zippered compartments.
Be the organized traveler everyone envies!
12. Portable Door Lock
You mustn’t miss out on the Portable Door Lock when packing your travel essentials! This compact lock adds top-notch security and peace of mind to your trips.
Portable door locks are hot on the list of travel essentials because of their simplicity – easy to use, install, and pack in your luggage.
Best for solo travelers and Airbnb guests, this device prevents unexpected entrance even with a key.
Pro tip: Always test the lock right after installation for foolproof safety.
13. Carry-On Rolling Luggage
With precise packing, it is feasible to fit everything you need into this one carry-on, thereby ensuring a seamless travel experience.
Picking the best carry-on rolling luggage for your needs requires careful consideration. Rolling luggage with 4-wheels can be ideal as it takes the weight off your wrist and can be rolled effortlessly by your side.
Spacious enough to accommodate all your travel essentials like laptop, shoes, etc.
Opt for brands that offer a good warranty to ensure the durability of your luggage.
If your travel involves different types of terrain or switching from airports to cobblestones, you might want to consider a wheeled backpack which can be rolled or carried as needed. Lastly, always ensure that your chosen luggage is lightweight, versatile, and
These suitcases not only provide convenience due to their mobility but also allow the freedom to avoid checked luggage.
14. Toiletry Bag
Toiletry bags have become an essential part of smart packing for travel.
Hanging toiletry bags, like the Bagsmart option, represent a game changer, contributing significantly to an organized, convenient, and hassle-free travel experience.
Pick one that has the ability to accommodate a week’s worth of travel-size toiletries.
15. Travel Duffel Bag
Whether it’s a long adventure or a weekend getaway, a travel duffel bag is incredibly useful.
It holds your essentials—clothes, tech gadgets, toiletry bag, keys, phone—safely and conveniently.
Remember the thrill of keeping all your belongings organized? You get that with the multiple compartments.
Also, let’s not forget about that separate section for shoe storage—talk about clutch!
Best feature? Some come with a built-in USB port to ensure your devices are always charged.
Expert tip: Look for a bag that’s airline-compliant, lightweight, and durable.
16. Travel Pillow
Ready for your next adventure? Don’t forget your travel pillow – it’s your key to ultimate comfort!
Many popular Travel Pillows offer tailor-made support for your head and neck, especially on those long-haul flights. It’s lightweight and packs easily, meaning less hassle for you.
Best for those who value a peaceful in-flight snooze, this game-changing essential comes with a memory-foam wall offering unmatched comfort.
Pro Tip: Pair it with the EverSnug travel blanket, It doesn’t just keep you cozy but doubles as a compact cushion too! Now, that’s travel made comfy and convenient!
17. Sunglasses Case
Off to a sun-soaked adventure, you need a nifty sunglasses case! It’s a must-have to safeguard your shades from damage while in transit.
Perfect for those eyeing to pack multiple pairs of sunglasses, you’d love this.
Expert tip – Choose a case that securely holds your glasses snugly, ensuring no damage takes place during the journey.
18. Contact Lens Case Kit
After my last late night flight, I was determined to find a better system for my contact. Enter the Contact Lens Case Kit.
Perfect for maintaining your vision care away from home, this kit boasts a mirror, mini solution bottle for your contacts, lens case, tweezer, and remover tool.
You can also get a contact lens and glasses case combo travel kit!
This handy, compact kit is an asset to anyone wearing contacts. Not only will it make your travel simpler, but it’s also affordable, priced under $10.
19. Reusable Water Bottle
Set off on your travels with the ultimate companion, a reusable water bottle!
Refill at any airport water fountain and save on plastic and expenditure – a savvy choice for our planet and wallet!
Plus this is a frugal green item with less plastic waste and sustainable hydration.
Expert Tip: Pack Liquid IV or Nuun tabs to make your drink a fun experience!
20. Packing Cubes
Say goodbye to disorganized luggage with packing cubes—your best travel buddy!
They’re a lifesaver for the frequent flyer seeking an organized and hassle-free travel experience. Especially those traveling with kids!
With features like shoe sleeves and compressibility, they’re ideal for chronic over-packers or shared-luggage travelers. I cannot say how helpful packing cubes are for trips!
21. Luggage Straps
Luggage straps are a travel essential you shouldn’t overlook! These handy accessories offer added security and ease for every traveler.
Designed with durability and convenience in mind, luggage straps, such as the TSA-approved luggage nylon straps, keep your checked bags secure during long flights. You’ll also love their visibility feature – bright neon colors that make your suitcase easily identifiable!
Ideal for people frequently on the go, they’ve garnered solid endorsements from seasoned travelers.
22. Travel Pill Box
Say goodbye to loose pills and experience medication portability at its finest with the Travel Pill Box – a real game changer for travel essentials!
The sheer convenience it offers makes it a must-have for every traveler.
The Travel Pill Box keeps your medications organized with multiple compartments that can be labeled as you wish.
Ideal for people on the go, it eliminates the need for bulky pill boxes and plastic bags.
Expert Tip: Allocate distinct sections for different medications and times of the day to ensure regularity even when your travel schedule is unpredictable.
23. Universal Travel Adapter
This top-quality adapter is a jet-setter’s delight, ensuring you’re always powered up on your globe-trotting adventures.
A travel adapter is a useful device that allows travelers to use their electronic devices in countries where different plug standards are used. It provides a hassle-free way to keep electronic devices like laptops, phones, or cameras powered up, vital for staying connected and entertained during international travels.
With its functionality in over 150 countries and capacity to charge six devices simultaneously, it’s perfect for the tech-savvy traveler.
Remember, it’s not a voltage converter, so ensure your devices are dual-voltage. If not, pack an adapter that converts voltage.
24. TSA Approved Luggage Lock
Secure your luggage with the TSA Approved Luggage Lock, an absolute must-have for every savvy traveler.
With this lock, enjoy peace of mind on your journeys, assured your luggage is safe and no one has been through your stuff!
Featuring easy-to-read dials, an inspection indicator, and a durable zinc alloy design, it’s perfect for frequent flyers and security-conscious travelers.
Expert Tip – Always lock your suitcase when unattended to deter theft. And carry an extra in case yours is lost.
25. TSA Approved Travel Bottles
These TSA Approved Travel Bottles are magnificent game-changers for any frequent flier.
They’re precisely designed, with an easy dispensing mechanism, and leak-proof tops, plus conform to TSA size limits.
A supreme choice for savvy travelers, they’re reusable, eco-friendly, and wallet-friendly.
26. Luggage Cup Holder
The Luggage Cup Holder is about to be your new jet-setting best friend. (In fact, I’m buying this for my son for Christmas.)
This genius accessory deftly holds your coffee or water bottle, freeing you up to maneuver through busy airports effortlessly.
Even better, it features a handy pouch for storing essentials like ID’s or credit cards.
Juggle less and travel more, with this brilliant travel necessity!
27. Compression Socks
Long-haul flights call for compression socks! They increase blood flow while reducing swelling and the risk of blood clotting which may occur due to prolonged periods of sitting, such as during long flights.
Thankfully, they are way more stylish than the traditional hospital-issued white compression socks. This has caused their popularity to soar, providing pressure from the ankle upwards, making them essential for flights.
These socks provide graduated compression especially high at the ankles and reduce upwards towards the knee, facilitating increased blood flow.
Moreover, they are not only meant for those with medical conditions, but also beneficial for travelers, athletes, and those who stand for long hours at work. They enhance overall leg health by minimizing swelling, fatigue, and discomfort, thus improving the quality of your daily activities and sleep.
28. Cruise Luggage Tags
Get ready to sail in style and convenience with one indispensable travel essential – cruise luggage tags.
It’s that little gadget you never knew you needed until you’ve used one and seen its magic.
Here’s why: These tags make your bags unmistakable, reducing the risk of losing them amidst a sea of sameness. It’s a godsend for frequent cruisers as your company-issued tags won’t fall off.
Go for brightly-colored, durable tags. A simple trick, but could save you from a world of lost luggage stress.
29. Laundry soap sheets
One of the best ways to pack less is to run a quick load of luggage on your trip. So, these laundry soap sheets come in handy! We also pack two dryer balls as well.
Ready to pack for your next adventure? Don’t forget laundry soap sheets, a travel game-changer! –
They’re lightweight and occupy minimal space. This is great when packing a minimalist capsule wardrobe.
No time to find a laundromat? Then, use SinkSuds which can be used anywhere!
30. Security Cameras at Home
Securing your home with surveillance cameras while traveling is a crucial precaution.
The peace of mind offered by a vigilant “electronic eye” is incomparable. These cameras capture real-time footage, aiding in deterring burglaries and providing evidence if needed. Perfect for frequent travelers, it assures your abode’s safety from afar.
When we travel, we install one inside our house with an instant notification on our phones. As motion is detected, a siren noise goes off, which I’m sure would terrify any intruder!
Expert tip: Opt for cameras with remote-access features, so you’re always a glance away from your home.
What are the five most important items you need for these vacations?
Setting off for your much-anticipated vacation?
Here are the top five must-have travel essentials for an easy-going and memorable adventure.
Travel Planner and Journal: This bundle is essential for planning your trip and keeping track of your daily activities. The planner helps organize your itinerary, while the journal provides a wonderful means to record memories and experiences from your trip.
Multipurpose Clothing: Items like versatile shoes or pants that are ideal for multiple activities such as hiking and sightseeing are crucial to pack. Such items can save you space in your baggage, simplify your travel outfits, and cover a variety of travel occasions or activities.
All-in-One Travel Bag: A multipurpose bag, like a fanny pack or backpack, is an important versatile travel essential. This item keeps your essentials within easy reach, aids organization, and can adapt to a variety of travel situations.
Personal Care Essentials: Depending on your destination and planned activities, personal care items may include sunblock, moisturizer, or insect repellant. They ensure you are prepared for the environmental conditions you may face and can greatly enhance your overall comfort and well-being during your travels.
Travel Luggage: This trendy luggage piece thrills travelers with its durability and sleek design. Make sure your suitcases are lightweight!
Remember, a well-prepared traveler is a happy traveler. Aim for comfort, protection, and convenience!
Which Essentials for Travelling are your Next Purchase?
Ready to embark on your next adventure?
Don’t let unexpected situations curb your enthusiasm – it all starts with being prepared.
Remember, travel isn’t just about the destination but the journey, and the journey includes packing well!
With these travel essentials ideas, you can load up your bags with high-quality travel gear, ensuring comfort and stress-free experiences during your trip and beyond. Many of which are actually Amazon travel must haves.
Investing in essentials now will not just save you money down the line, but also help avoid irritating travel hitches.
Whether it’s tangle-free cords, smart luggage, or convenient packing tools – each item on our list has earned its spot by proving its worth on countless journeys for me.
So, next time you’re planning a trip, remember to refer back to this list. Good preparation equals to great journeys!
Know someone else that needs this, too? Then, please share!!
According to Kelley Blue Book, the average price for a light vehicle in the United States was almost $38,000 in March 2020. Of course, the sticker price will depend on whether you want a small economy car, a luxury midsize sedan, an SUV or something in between. But the total you pay for a vehicle also depends on a number of other factors if you’re taking out a car loan.
Get the 4-1-1 on financing a car so you can make the best decision for your next vehicle purchase.
Decide Whether to Finance a Car
Whether or not you should finance your next vehicle purchase is a personal decision. Most people finance because they don’t have an extra $20,000 to $50,000 they want to part with. But if you have the cash, paying for the car outright is the most economical way to purchase it.
For most people, deciding whether to finance a car comes down to a few considerations:
Do you need the vehicle enough to warrant making a monthly payment on it for several years?
Is the deal, including the interest rate, appropriate?
Factors to Consider When Financing a Car
Obviously, the first thing to consider is whether you can afford the vehicle. But to understand that, you need to consider a few factors.
Total purchase price. Total purchase price is the biggest impact on how much you’ll pay for the car. It includes the price of the car plus any add-ons that you’re financing. Depending on the state and your own preferences, that might include extra options on the vehicle, taxes and other fees and warranty coverage.
Interest rate, or APR. The interest rate is typically the second biggest factor in how much you’ll pay overall for a car you finance. APR sounds complex, but the most important thing is that the higher it is, the more you pay over time. Consider a $30,000 car loan for five years with an interest rate of 6%—you pay a total of $34,799 for the vehicle. That same loan with a rate of 9% means you pay $37,365 for the car.
The terms. A loan term refers to the length of time you have to pay off the loan. The longer you extend terms, the less your monthly payment is. But the faster you pay off the loan, the less interest you pay overall. Edmunds notes that the current average for car loans is 72 months, or six years, but it recommends no more than five years for those who can make the payments work.
It’s important to consider the practical side of your vehicle purchase. If you take out a car loan for eight years, is your car going to still be in good working order by the time you get to the last few years? If you’re not careful, you could be making a large monthly payment while you’re also paying for car repairs on an older car.
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You can buy a car anytime if you have the cash for the purchase. If you have no credit or bad credit, your options for financing a car might be limited. But that doesn’t mean it’s impossible to get a car loan without credit.
Many banks and lenders are willing to work with people with limited credit histories. Your interest rate will likely be higher than someone with excellent credit can command, though. And you might be limited on how much you can borrow, so you probably shouldn’t start looking at luxury SUVs. One tip for increasing your chances is to put as much cash down as you can when you buy the car.
If you can’t get a car loan on your own, you might consider a cosigner. There are pros and cons to asking someone else to sign on your loan, but it can get you into the credit game when the door is otherwise barred.
Personal Loans v. Car Loans: Which One Is Better?
Many people wonder if they should use a personal loan to buy a car or if there is really any difference between these types of financing. While technically a car loan is a loan you take out personally, it’s not the same thing as a personal loan.
Personal loans are usually unsecured loans offered over relatively short-term periods. The funds you get from a personal loan can typically be used for a variety of purposes and, in some cases, that might include buying a car. There are some great reasons to use a personal loan to buy a car:
If you’re buying a car from a private seller, a personal loan can hasten the process.
Traditional auto loans typically require full coverage insurance for the vehicle. A personal loan and liability insurance may be less expensive.
Lenders typically aren’t interested in financing cars that aren’t in driving shape, so if you’re buying a project car to work on in your garage during your downtime, a personal loan may be the better option.
But personal loans aren’t necessarily tied to the car like an auto loan is. That means the lender doesn’t necessarily have the ability to repossess the car if you stop paying the loan. Since that increases the risk for the lender, they may charge a higher interest rate on the loan than you’d find with a traditional auto loan. Personal loans typically have shorter terms and lower limits than auto loans as well, potentially making it more difficult for you to afford a car using a personal loan.
Steps You Should Follow When Financing a Car
Before you jump in and apply for that car loan, review these six steps you should take first.
1. Check your credit to understand whether you are likely to be approved for a loan. Your credit also plays a huge role in your interest rate. If your credit is too low and your interest rate would be prohibitively high, it might be better to wait until you can build or repair your credit before you get an auto loan. Sign up for ExtraCredit to see 28 of your FICO scores from all three credit bureaus.
2. Research auto loan options to find the ones that are right for you. Avoid applying too many times, as these hard inquiries can drag your credit score down with hard inquiries. The average auto loan interest rate is 27% on 60-month loans (as of April 13, 2020).
3. Get your trade-in appraised. The dealership might give you money toward your trade-in. That reduces the price of the car you purchase, which reduces how much you need to borrow. A few thousand dollars can mean a more affordable loan or even the difference between being approved or not.
4. Get prequalified for a loan online. While most dealers will help you apply for a loan, you’re in a better buying position if you walk into the dealership with funding ready to go. Plus, if you’re prequalified, you have a good idea what you can get approved for, so there are fewer surprises.
5. Buy from a trusted dealer. Unfortunately, there are dealerships and other sellers that prey on people who need a car badly. They may charge high interest or sell you a car that’s not worth the money you pay. No matter your financial situation, always try to work with a dealership that you can trust.
6. Talk to your car insurance company. Different cars will carry different car insurance premiums. Make a call to your insurance company prior to the sale to discuss potential rate changes so you’re not surprised by a higher premium after the fact.
Next to buying a home, buying a car is one of the biggest financial decisions you’ll make in your life, and you’ll likely do it more than once. Make sure you understand the ins and outs of financing a car before you start the process.
This article originally appeared on The Financially Independent Millennial and was republished with permission.
When consumers purchase a car, there are several things to think about. While the primary process has been handled entirely with test drives and dealerships or private sellers, it’s up to you to continue further down the checklist to get the most out of a used car.
People might think that there’s nothing left to do after buying a car, but don’t forget to take the steps needed to keep a used car on track.
1. Get the Car Insured
When you buy a car, the first thing to always do is to get insurance before leaving the car lot. Getting into an accident just after leaving is a terrifying possibility after spending hard-earned money on a car, even if it’s a used car. Either way, it’s an investment, and buyers need to protect themselves.
It’s a good idea to call around before purchasing the car model you have in mind to get a quote. If that didn’t happen before, getting the best car insurance must be the top priority to get taken care of once a vehicle is purchased. Some dealerships require buyers to have insurance before leaving, so being ready with insurance is imperative for a good experience.
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2. Check for Existing Recalls
Recalls happen in brand-new and used vehicles as technology changes over time. Sometimes, manufacturers will send out information for a recall because of a necessary update, too. Certain recalls can also affect driver or passenger safety, so recalls cannot be ignored.
After the purchase is complete, buyers can find information about recalls from the National Highway Traffic Safety Administration. Get the vehicle identification number or VIN from the car to complete a search. It’s also a good idea to check for recalls multiple times a year because new recalls are released periodically.
3. Transfer the Title
If a car is purchased from a dealership, the dealership typically handles the title transfer. The title is the official document that proves ownership, so if you buy privately, it’s critical to get this taken care of as soon as possible after purchase.
When purchasing from a private seller, buyers need to verify liens do not exist from the previous owner. If there are, those need to be handled immediately. Buyers need proof that the seller has documents that prove any loans have been paid as required. If a buyer has any questions about transferring a title, the DMV needs to be contacted for state-specific answers.
4. Get the Car Registered
Once a car has been purchased, it must be registered with the DMV soon after. Car dealers will typically handle getting the vehicle registered in the buyer’s name, but it’s different when working with a private seller. Private sellers should provide documentation to the buyer to show to the DMV to get the registration done.
Some of the documents needed include the bill of sale showing the purchase price, the title that has been signed over by the previous owner, the VIN, proof of insurance, odometer reading, sales tax if applicable, and evidence of passed inspections. Buyers also need to contact the local DMV to find out if any further documents are required.
5. Find a Trusted Mechanic
Finding a mechanic can be challenging, which is one reason that buyers may prefer to purchase from a well-respected dealership. Dealerships have mechanics on staff that are responsible for conducting an inspection and doing any preventative maintenance before the purchase.
Private sellers are different, and buyers need to be aware of getting a used car with issues. Ideally, the vehicle should be checked before purchase, but it needs to have a thorough inspection done when that’s not possible. When in need of a trusted mechanic, buyers should research reviews and request recommendations from local groups to get an idea of who to trust.
6. Schedule Any Necessary Repairs
Once the mechanic has had a chance to complete an inspection, it may be recommended to replace spark plugs, belts, or any frayed wires, along with any other issues. There may also be cosmetic issues that may need to be dealt with if the buyer deems these repairs are essential.
Some repairs may be more critical than others, so depending on what the mechanic says, there may be a list that needs to be followed. It’s possible that the new owner might need to prioritize repairs to get things done over time. If that turns out to be the case, working out a schedule with a trusted mechanic will be a great way to get things done.
7. Read the Owner’s Manual
It’s a good idea to read the owner’s manual to get to know your newly purchased vehicle inside and out. It may not be full of entertaining reading, but knowing what the lights on the dashboard mean can be helpful should they come on. Buyers can also read about any potential existing warranties that might still apply to the car.
Getting to know more about the car is helpful because new owners can learn about what to expect regarding the engine and other internal components of the vehicle. It also gives the owner a chance to become familiar with some of the more specific details about different parts of the car.
8. Create a Maintenance Schedule
Using the manual, buyers can also get to know what the regular maintenance schedule is for the car. Each manual contains a suggested maintenance schedule, so a buyer knows what to expect and plan for in the future. Sticking with the recommended schedule can help in saving money over time, too.
Maintenance is a crucial part of being a responsible car owner. That includes keeping an eye on the wear and tear of tires, keeping up with oil changes, and getting regular tune-ups. Finding a trusted mechanic is essential in keeping car maintenance from becoming overwhelming.
9. Consider an Extended Warranty
When purchasing a used car, buyers may also want to consider a used car warranty. There are many different options available for warranties that range from expensive repairs to bumper-to-bumper coverage. Buyers should still do research to figure out the best options available.
Keep in mind that some warranties appear to be scams, so researching is vital in making the best selection. Buyers should also check for any specific fine print regarding repairs and coverage. Some warranties are only effective at particular mechanics, so those might be ones to steer clear from.
10. Get Familiar with Features
Once the car is ready to go, buyers need to familiarize themselves with the car’s features. Learning what all of the buttons do is vital because the last thing anyone wants to deal with is trying to figure out how to open the gas tank at an inopportune time. Knowing how to program the dashboard is helpful, too, to enjoy driving to the perfect soundtrack.
Features go beyond the buttons, though, and include levers for seats and the position of latches if installing a car seat is an essential aspect of the car. Finding out where all of the power outlets are is also important so owners can charge their gadgets as needed.
A Few Last Words on What to Do after Purchasing a Used Car
There’s a lot to think about after purchasing a used car. Getting car insurance and title transfers are essential to getting started. Finding out about recalls is critical to keeping the car safe for drivers and passengers. Once registration is complete, it’s time to get the car inspected by a trusted mechanic.
After that, it’s all about creating a schedule for repairs or maintenance to get the most out of a newly purchased car. Getting familiar with the features is also essential to feel comfortable with a new car, even if it’s a used car, because it will be new to you.
Once all of the necessary tasks are done, it’s time to get down to the fun stuff, like finding the accessories that reflect your personality. Adding some exciting goodies to a vehicle should be a part of what it means to have a new car. Taking care of it with regular car washes and giving the car some character is the icing on the cake. When everything is squared away, it’s time to take a drive and enjoy your new car experience.
Okay, so you’re tired of puttering along in that same 1996 Honda Civic with which you picked up your Homecoming date during your senior year of high school. How do you even begin? No doubt, you’ll have questions to ask when buying a used car. Well, first, you need to narrow it down to which car you want, what options you want/can live without, your budget, etc. Once you’ve gotten that down and have taken a few cards for a spin, it’s time to get down to business.
I bought my first car just about ten years ago and have bought and sold seven cars within that time frame. Except for one, I made a profit off every single one of them. For example, My INFINITI G37 just stole my heart. I got such a good deal on it (I bought it for $4,700 under dealer internet price) that I made the conscious decision to take a loss by keeping it longer and thus having to deal with depreciation.
However, it never needed any maintenance for the six years I had it other than $40 oil changes periodically. So, considering all costs (parking, annual registration, gas, car insurance, and depreciation), the car probably cost me $150 per month over those six years. That’s well below what some friends spent on the luxury of ride-sharing.
What to Ask When Buying a New Car
When you’re ready to buy a used car, you want to come armed with questions. Ensure you’re informed, and then you come across as a knowledgeable buyer and ward off any unscrupulous sales tactics.
#7. When Is the Best Time to Buy a Used Car?
We’ve all seen those charts on the best time to buy everything from winter apparel to laptops. But did you know there is a sweet spot for buying cars, as well? Buying towards the end of the month and even the end of the year is your best bet. Why? Because dealerships have quotas to meet, salespeople are hungry to get one last commission for their paycheck.
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As far as the end of the month, most dealerships close the books, project that month’s sales amounts, and try to move inventory to keep the interest fresh. You may know that when new models come out and leases get returned, the used car market is usually more flexible, which means more selection and a better price for you.
If you’re daring, go into the dealership on a Sunday evening during unpleasant weather when they’re hungry to meet quotas. If you’re paying cash, and you’re there with money in hand, they’re much more likely to get you a good deal. Make sure you come with evidence of comparable models elsewhere.
#6. Why Is Buying Used Better Than New?
While many people justify their decision to buy new as having a more reliable vehicle and spending less on repairs than an older car, cars have markedly improved their dependability over the last 10-15 years.
Plus, many online tools help you with price transparency, find service records, and owner/expert reviews. You’ll find anything you want to know about the car you’re considering over the last decade.
According to a recent report, new cars lose up to 20% of their value after the first year. And then they depreciate more than HALF their value after five years. On a $32,000 car, that’s almost a $7,000 hit after just a year of driving! On the other hand, you can easily buy a car that’s just a few years old and let someone else take the depreciation hit.
Besides houses, cars are generally the most expensive purchases you’ll make. Buying used enables you to strategically get a reliable vehicle that can last you years without breaking the bank. My neighbor once bought a 4-year-old Honda Accord for $12,000 and still drives it ten years and 90,000 miles on the odometer later!
#5. Why Is Buying Better Than Leasing?
According to Consumer Reports’ comparison for buying versus leasing, the average cost of a new car has now topped $38,000. You might think to yourself, “I don’t have $38,000 laying around!” Well, take a step back and a deep breath, realizing this is average. Meaning, you can easily find cars for less than this amount. Plus, just another reason to look at a mint used car!
Leases can be appealing because they enable the consumer to drive a new car for a monthly lease payment. Lenders are happy to collect the interest! And then, you return the vehicle at the end of the lease without worrying about maintenance or repairs. Leasing is ideal for people who like to have the newest car (and can afford it) or deduct leasing expenses like realtors. And yes, if you’re wondering about this question, you can lease a used car as well. However, there are mileage limits, and if you lose your job or have a child, you typically can’t just hand the keys back without penalty.
Buying a car means you can drive it freely and have something of value that you can sell when the need arises. With leasing a vehicle, you typically have to either return it, have nothing at the end of the lease, or pay off the car at an agreed-upon amount when you lease the vehicle. For these reasons, buying a car is the best option for most people.
#4. How Many Miles Should a Used Car Have?
Congratulations, we’ve convinced you to buy used! Well, hopefully, you’re empowered to ask questions and find and buy a quality used car, over lining the dealership’s pockets with a new one. Mileage is an essential factor to consider, and the lower mileage, the better. Think about it, cars don’t run forever. So, there’s a cap on mileage before the vehicle is pretty much worthless. (though if you want to see some impressive machines with millions, yes millions of miles, check out this car.)
Most people drive about 10-12,000 miles per year. And with ever-changing technology, it might be best to keep it under 100,000 if you plan to keep the car for a while. After 100,000 miles, more expensive servicing like timing belt change, transmission replacement, and electrical repairs come along.
Consumers who question a used car’s value can turn to The Kelley blue book as an excellent resource when buying or selling. I have found that buying cars with low-mileage, i.e., under 30,000, is the sweet spot if you can snag a good deal because it still feels new. These cars usually come with the balance of a new or extended warranty and yet have decent value locked in. Bonus points if you flip it a year later for a profit as I did!
#3. What Are the Benefits of Buying a Used Car from a Dealer?
You can compare buying a certified pre-owned (aka used car) from a dealer instead of a private party to purchasing a laptop from the store versus a seller on Amazon. You typically get more hand-holding and a concierge process with inspection of the car, service and registration assistance, etc. Yet, that comes with a price.
Buying a used car from a dealer means there’s no question: they have to stand behind that car and not sell you a lemon because their reputation lies on that. So, peace of mind is a big plus when it comes to buying from a dealer. Also, you can typically find more variety in what you want and have someone reach out to you when they get something closer to what you’re looking for. You can also negotiate free service for a year, a multi-point inspection, printouts of service records, and things like replacing the tires at a reduced cost. Moreover, suppose haggling, negotiations, or dealing with salespeople make your stomach churn. In that case, you can always pay a slight premium for peace of mind by using a service like Carvana or Carmax.
Buying from a dealer can also help you make sure you get your title and tag done correctly. One thing to look out for is some dealerships charge a Dealer or “Document Preparation” fee, which can be hundreds of dollars in some states. Be sure to understand what value they’re providing for that fee and where it goes. Few waive them and even charge their employees that fee.
#2. What Are the Benefits of Buying a Used Car Privately?
How do you save the MOST amount of money when buying a car? Well, you buy a pre-owned vehicle that already got whacked with depreciation and cut out the middleman. By middleman, I mean the dealership.
Now, you read about the perks of buying through a dealer and all the peace of mind it brings. So, why bother dealing with the hassle and uncertainty of a private party? Well, the significant cost savings, of course! There’s no dealer doc prep fee, no markups to pay for payroll or overhead, and no burdensome certification process. Buying a used car privately gives you the best chance of getting a great deal if you ask the right questions.
In simpler times, a handshake and trust were all we had to go off before things like CARFAX reports and AutoCheck. When you find a private seller, you can find out the vehicle history. For example, if they were the original owner, who drove the car, why they bought it, and how it’s been treated over the years. Also, you’ll have to make sure they have the title free and clear. Otherwise, you’ll want to go to the bank and have them call the company that holds the title to make sure the loan gets paid off before any other money changes hands.
#1. What Are the Best Ways to Find a Used Car?
Now how do you go about finding a used car? There are many more online tools at our disposal than ever before. Do you remember the times when you would flip to the classified section of the newspaper to find boxes of 6 point font describing a car for sale? Or you saw a car parked on the road with a “For Sale” sign? How times have changed.
Now, you can easily find any car you want online, know everything about it, see high-resolution pictures of its every angle. And you don’t even have to limit yourself to your geographic area!
The thing to know is most private-party sellers will usually try to sell their car for free or cheaply. So, be sure to start your search by scanning Craigslist, Cars.com, and Facebook Marketplace.
Expand Your Search
Now, if you’re looking to expand your search across the state or nation, check out cars.com, Cargurus.com, and Truecar.com. All of these sites provide decent vehicle descriptions and history, such as accident reports.
Cars.com has a very user-friendly interface and easy navigation filters for color, features, cloth/leather, etc. It also has a price analysis tool to let you know if that particular car is a “good” or “great price” as compared to other vehicles for sale.
CarGurus is also user-friendly and has a similar price comparison tool. Also, it’s got a cool little “negotiation” section in the description. It tells you how long the car has been on the market and its different price changes. It can give you a glimpse of how motivated the dealer is to get rid of the vehicle. I love CarGurus because it answers the most basic questions I’d ask about the used car I’m thinking about buying.
Finally, TrueCar has a unique pricing analytics report that will tell you what you can expect to pay based on what similar vehicles have sold for. They also can offer a unique “personalized offer” on a car, which might be lower than other sites, in exchange for inputting your contact information. It might be an easy trade to shave a few hundred off your car purchase!
Final Thoughts about Buying A Used Car
Consumers looking to buy a used car certainly have to ask a lot more questions than when buying new. But, the extra work will save them thousands in unnecessary depreciation. The key is to do your homework and get the car inspected. That way, you’ll come out ahead by knowing the car’s history. And don’t be afraid (ever) to walk away from a bad deal!
When you’re considering starting home shopping, it’s important to put yourself in the best possible position. To do this, you’ll want to shore up your finances and increase your credit score. Follow these simple steps to get you closer to your homebuying dream.
1. Check Your Credit Score
Your credit score will be one of the main considerations in your mortgage application, so check yours to see what needs the most work. A credit score is based on a number of factors: payment history, credit usage, types of credit, age of credit, and recent inquiries. Though you can’t impact all of these in a short period of time, you can take steps to improve in some areas.
Make sure you’re paying all of your bills on time, as on-time payments have a huge impact on your score. Don’t apply for new lines of credit, but you can request a credit limit increase to current credit lines to improve your usage percentage. If you see any errors on your credit report, dispute them so that errors can be removed or corrected, and target credit usage when you make your budget.
2. Assess Your Finances
To know what you have to do to buy the home of your dreams, you need to know where you stand. Write down everything you have coming in and going out each month first. Some of these expenses, such as your car and student loan payments, stay the same over time and will come with you to your new home. Others are variable and change from month to month, including how often you eat out and your entertainment expenses, and these expenditures can most likely be shaved down or eliminated entirely with a budget.
Because homebuying comes with many expenses–a down payment, inspection fees, closing costs–your budget should be tighter in the period before you buy than normal. You’ll also want to budget for a home warranty; see if a home warranty is worth the money. When developing your budget, focus on eliminating your high-interest debt and saving for those homebuying expenses.
Lenders will also look at your debt-to-income ratio or DTI which is the amount of money you have coming in each month versus the expenses you have. Though it varies between lenders, many lenders will not give a mortgage to someone whose DTI is higher than 43%.
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3. Understand Homebuying Costs
For nearly every type of mortgage, a down payment is required. A down payment of no less than 20% is suggested to have better home options and lower monthly costs. Conventional loans allow 20%, however, you can also have a down payment of as little as 3%; for down payments below 20%, PMI (private mortgage insurance) is required. Other types of loans, like an FHA loan, require between a 3.5-10% down payment, depending on your credit score. Make sure you understand how much you’ll be spending on your new home by using a mortgage calculator.
Other homebuying fees can add up quickly and be more variable. You will likely have a loan origination fee, inspection fee, appraisal fees, and other fees. You may be able to control some of these by choosing your own professionals. However, others will be selected by the seller, real estate office, or mortgage company.
A brokerage commission may be paid to real estate agents on closing. Your home warranty, property insurance and taxes, and any points you wished to pay to lower your mortgage rate as well as current interest rates will all go into your final costs. Account for all of these expenses when deciding how much mortgage you can afford.
Take steps to improve your creditworthiness and your DTI, and know what you’re looking for when you begin shopping for a lender to work with so you get the best rate possible. With the right moves, you’ll be closing on your dream home in no time.