CRA Personal Finance – South Africa
If you are scanning the latest car models online and dreaming of owning your first set of wheels, right now could be a good time to buy that car.
For many young professionals who have recently entered the job market, buying a vehicle is probably one of the first big ticket items on the road to independence and adulthood.
While the responsibility of buying and maintaining a car may be a daunting prospect, the current favourable low interest rates and some great deals on offer in both the new and used car markets, are both compelling reasons to purchase a car.
“Any vehicle purchase should be guided by doing your homework thoroughly to reach an informed decision. While buying a new car is an exciting experience, it is also one of the most significant decisions to consider in your monthly budget,” says Lebogang Gaoaketse, head of marketing and communication at WesBank.
Whatever your dream car is, when it comes to the actual purchase – you need to remain grounded and realistic. Factors such as affordability and which finance deal will get approved, the lack of a credit history for many young professionals can be a stumbling block on the path to vehicle finance. To overcome this, WesBank has put a special deal in place, where a credit history is not essential. The application process to check affordability and get approval for a vehicle finance deal can all be done online, and is quick, easy and instantaneous.
“For us, it is important that graduates and young professionals fully understand the buying process. When they apply for finance with WesBank, they are assessed on a different set of criteria to check affordability. This means that the finance packages we offer are exclusively structured for them to ensure the delight in owning a car is not hampered by the responsibility of it becoming a financial burden. As a responsible lender, we will only approve a finance deal that is affordable,” says Gaoaketse.
Owning a vehicle is also much more than the monthly instalment. Remember that extra costs for consideration include comprehensive vehicle insurance, fuel, maintenance and repairs, which can all impact monthly budgets and cash flow. Buying a car is also a long-term commitment, so it’s important to understand the economics involved over an extended period of time.
The following tips from WesBank will help you become financially savvy when navigating the decision-making and car buying process:
Track your income and expenses
Draw up a budget of all your monthly expenses and make sure you have more than you spend to determine exactly how much you can afford to spend on a car.
Spend less than you make every month
This sounds obvious, but if you don’t track your spending, you can overspend on your budget, resulting in debt that may be difficult to manage.
Spend less on wants than needs
Peer pressure can result in going out and socialising or buying the latest fashion items, when that money could be better spent saving towards bigger purchases such as a car, a financial investment or even owning a house. Be careful not to make spontaneous spending and expensive purchases a habit – once in a while is fine, budget permitting of course!
Start saving early and regularly
You are never too young to open a savings account. Being disciplined about saving is an important lifelong financial lesson that should become a habit.
“It is our responsibility to ensure that young professionals are equipped and knowledgeable when it comes to budgeting for their first long-term commitment purchase. In our experience, the best purchasing decisions are always made when you have all the facts at your fingertips, and you are well informed. Now that you have the lowdown on what is required and you are ready to make the financial commitment, the best time to consider buying that car is right now,” concludes Gaoaketse.
Article Credit To Northglen News.