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5 Tips To Help Budget Your Performance Or Sports Car Purchase

Are you planning on buying a performance or sports car? There's a lot going on for owning a specialised car, including the incredible feeling of freedom as you accelerate on the highway. For people who favour a sense of adventure over sensibility, a performance or sports car makes a statement and an impact. It speaks to your carefree, adventurous personality, your sense of aesthetics and style and your social status. These are but some of the reasons why you might want to purchase such a vehicle.

But how can you make this a reality, especially given the price tag associated with these types of cars? This helpful article will share five tips to help you budget towards your performance or sports car purchase, so continue reading to learn more.

1. Consider Taking out a Car Loan

If you’ve crunched the numbers and you’ve realised that you can either only just afford your dream car outright, or may find yourself in the red as a result of purchasing, then you'll want to weigh up your car loan options to finance your purchase. Taking out a car loan can help ensure you don’t need to compromise when it comes to buying your dream performance car.

It’s important to keep in mind, however, that not all car loans are equal, with some stark differences in interest rates, fees, loan structures and deposit amounts required. With that, it's worth spending some time researching different car loans to find a loan that's suitable for you. Then, figure out if you can afford the scheduled repayments based on the loan amount and interest rate. Several different personal loan calculators on the internet can help you with your budgeting.

2. Sell or Trade In Your Old Vehicle

If you already own a vehicle, you're sitting on an asset that can be leveraged to go towards your sports or performance car purchase. Unless you've got a rusty old jalopy, your old car is worth some money.

Generally speaking, you'll always get a higher sale price if you sell on the private market, such as via a car sales website or Facebook or Gumtree. However, you'll have to deal with low ballers, tyre kickers and time wasters selling this way. By trading your old vehicle in at the dealership where you buy your new car, you'll get a lower sales price, but the dealership will deal with all the paperwork and make the process easier, which has a value attached to those who value their time and headspace.

3. Put Down a Decent Deposit

If you’re going down the car loan route, then take this little piece of advice: the bigger your deposit on a car loan, the better off you'll be for the life of the loan. This is because, with a larger down payment, your loan principal amount will be smaller. A smaller principal means less interest payable on the loan over five to seven years, which results in lower costs for the loan over its lifespan.

Simply put, saving up for a larger down payment will save you money that you can put towards other expenses for your vehicle, such as fuel, insurance, maintenance and cleaning. A 20-30 % deposit is a solid rule of thumb to have.

4. Cut Out Discretionary Spending

If you're trying to afford a new sports or performance car, you'll want to eliminate unnecessary expenditure. All the money you save by doing this can then be put towards the deposit on your hot new set of wheels. You'd be shocked at how much you can save if you reduce your spending. For instance, how many television streaming services do you have? Can you settle for just one? What about retail online shopping subscriptions such as Prime or Catch? Do you need all of those individual subscriptions? If not, then it’s time for a much-needed cull!

Similarly, if you eat out everyday for lunch at work and buy a couple of takeaway coffees, this adds up to hundreds of dollars a month. Pack a lunch instead, and bring some coffee to brew up at work and you'll see the savings in action. Other frivolous expenses can include gaming, snack food, hobby purchases and more. And if you're fair dinkum about wanting to buy that fancy new vehicle, then you should be able to prioritise and save some money.

5. Consider Buying Used Rather than New

The temptation to buy a brand-new vehicle may be strong, but if you buy a used one, you could save tens of thousands of dollars on the purchase price. Even a model that is a year or two old with 10-20000 kilometres on the clock can represent a significant cost saving versus buying a new model.

If you're concerned about mechanical issues or the quality of a used vehicle, you have a few options to set your mind at ease. For instance, you may opt to buy from a dealership with a guaranteed warranty period. A car that is only a year or two old will still come with several years of manufacturer's warranty as well.

You can also commission an independent mechanical pre-purchase inspection, which can identify any defects and ensure that you don't buy a lemon.

A Car Buying Conclusion

This helpful article has shared the top five tips to help you budget towards your next performance or sports car purchase. Follow these tips to make a sound financial decision and drive off the lot in your dream vehicle.