One Vehicle Payment at a Time

budgetting finance May 28, 2021

How many vehicles do you pay for in your household? One? Two? Three, if you include the trailer? Don't you wish you only had one vehicle payment at a time? 

2 or more vehicle loans simultaneously is a hefty monthly commitment. I have seen $1400 in car payments alone and when you add on insurance for 2 vehicles, transportation costs become more than your average mortgage!

Aiming to have only 1 car payment (or less) is an example of what I term "planned spending". This frees up cash flow for your goals and can be done fairly easily with a bit a forward thinking.

 

1. Instead of waiting to "need" a new vehicle, consciously decide ahead of time.  In my household the oldest vehicle would be the first to get replaced. For example, if my partner had a 2016 and I have a 2020 then he would be next to get a vehicle and we would take turns.

 

2. Make your payment amortization as short as possible. Finance for no longer than 4-5 years – ideally. In order for...

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