Considering getting a new car? You might be concerned about whether or not rising inflation will affect what you can qualify for. Learn more about what inflation means for your car financing and what you can do to jump over this financial hurdle, courtesy of the knowledgeable financial advisors at Maggi Tax!
How Inflation Affects Auto Loans
It probably comes as no surprise that inflation can cause the prices of cars to increase, but did you know that it can affect interest rates, too? If you’re taking out a loan for your new vehicle, you could be paying much more just on the APR alone meaning that you will have an increased monthly bill. The worst part is that the interest doesn’t even cover the cost of the car itself, so it’s like you’re paying that extra amount just for the privilege of being able to take out a loan so that you can own the car sooner than later. This issue is still relevant for vehicles that are manufactured outside of the United States, so opting for a foreign car won’t give you a free pass on avoiding higher interest rates.
Things You Can Do When Financing A Car
If you absolutely need a car but you can’t finance one without a loan, there are a few tricks you can do to help sway the price in your favor. The obvious move would be to look into used car models that go for a much lower price. You can also look into certain makes and models that are known for holding their value over a long period of time as opposed to cars that tend to depreciate much faster. Once you find a car that fits your needs and budget, you can always try your hand at negotiating with the salesperson to see if you can lower the price tag. Even a small decrease can be a great help in the long run.
Proper Planning For Car Financing
Before you jump straight into purchasing a car, it’s best to prepare yourself for all of the possible costs. Other than what you would have to pay in interest, you should also account for regular maintenance and repairs down the road. Calculating your current finances while predicting future expenses can be difficult, but visiting a financial advisor can help put things into perspective for better planning.
Need Help With Financial Planning For An Auto Loan?
Call Maggi Tax today at (727) 799-1701 to schedule a complimentary consultation and get started on proper planning for your car finances during this time of inflation. Our skilled team of financial specialists can help you formulate a plan that works within your budget while getting you the ride you need to tackle your daily routine.
