Many drivers strive to one day own their dream car! A dream car will look different to each person and means their savings goal will too. If you’re wanting to save for your dream car but aren’t sure where to start, the guide below helps you do exactly that. By setting a realistic goal and budgeting your finances to save as much as possible, your dream car can sharp become a reality.
Set your savings goal.
The first thing you will need to do is determine how much you need to save up. If you already have an idea of what your dream car is, look at the current market price of the car you want to buy to get an idea of how much to save up. If you’re considering using car finance to help you buy your dream car, your savings goal may be for a large finance deposit to help get you approved.
Review your finances.
Before you can work out how long it will take you to reach your savings goal, you will need to how much you could put towards your savings goal each month. Consider your current incomings and deduct any essential bills and payments you need to make each month. You can then identify how much you have available to put towards your savings goal.
Calculate how long it will take.
Once you know how much you need to save and how much you can afford to save each month, you can the calculate how long it will take to reach your savings goal. For example, if your savings goal is £30,000 and you can save £500 a month, it take you 5 years to reach this goal. If you calculate how long it will take to reach your goal and it’s taking too long, it can be a good chance to see how much extra money you could also free up.
Cut your spending.
If you feel your savings goal is too far out of reach, it can be worth evaluating what you’re spending and getting rid of any unnecessary spending. Take a look at things like streaming services, gym memberships or any other subscriptions you pay for. Ask yourself if you could live without them and if so, you should cancel your monthly payment to instead put towards your savings goal. Getting rid of ay unwanted financial commitments can also free up some money to put towards a car finance deal. Car finance is a good idea if you want to pay for a car through fixed monthly payments over a number of years. Having more money to put towards your car finance payments can also help you to get a newer, better car.
Open a dedicated savings account.
It can help to separate your money for a dream car into a dedicated savings account. If you also choose an account which accumulate interest, you can also reap the benefits of extra money on top of your savings too, especially if you’re saving over several years.
Use a budgeting app.
If you’re finding it hard to keep on top of your money or you need to recalculate your savings goal when new payments or direct debits come along, a budgeting app can be useful. There are many useful budgeting apps in the UK which can help you to budget for your next car purchase and encourages disciplined spending.
Sell your old stuff.
We’re all guilty of hoarding stuff we no longer need or use. If you’ve got clothes, toys games, beauty products or electronics that you’ve never used for ages, it could be a good time to sell. There’s plenty of free selling sites and apps you can use to get rid of your old stuff, from eBay to Vinted, there’s sure to be a platform which can get rid of your stuff quickly and easily and make some money as long the way.
