Planning Tips to Keep Your Hand on the Wheel of Your Car Loan

Borrower and lender shake hands after finalising a car loan

02 May Planning Tips to Keep Your Hand on the Wheel of Your Car Loan

So, you finally upgraded your wheels! Driving off the lot in a new car (even if it’s used, it’s still new to you!) is a terrific feeling, but don’t neglect your car loan. With the thrill of a new car purchase, we can often forget about the commitments we made to put ourselves in this position. You’ve already negotiated the terms for a loan that is tailored to work with your situation, but there’s still work to be done.

Fortunately, your car finance can be managed with some basic responsibility and planning. Read on to learn how you can maintain control of your car loan.

Make a budget and stick to it

Car finance is the same as any other loan. Making your payments without disrupting your finances requires careful planning and a clearly drawn budget. Map out all your expenses and income. If the bottom line is tight, consider ways you can give yourself breathing room. Is there any way you can bring the electricity bill down this month? Might now be the best time to try coupon shopping?

Even with the added expense of a car loan payment, you still want to feed at least a little money regularly into the rainy-day fund should any surprises arise further down the road. If you can avoid it, don’t let your car loan force you to live on the brink.

Make your payments on time

This can seem like obvious advice, but it bears repeating. Loan payments are easy to lose track of when life throws you a few surprises and the consequences for late payments can be significant. The budget you’ve put together to make your loan payments will have factored in the interest your loan will accrue over time. Late fees and added interest can force you back to the drawing board on your budget and stretch your money a little thinner. The easiest way to budget is to set up an automatic recurring payment for your car loan the same day your pay-out arrives.

Review your circumstances regularly

Don’t just shoot a passing glance at your payment plan in the first week and then put it on the shelf. Your budget will allow you to make your finances more predictable, but circumstances often change. An unexpected pay raise or a successful cost-cutting measure could put you ahead of your own curve. These are opportunities to increase the repayments on your car loan, reducing your interest and finishing your payments ahead of schedule.

Be Realistic

Maintaining realistic goals and budgets is always important. If you are too ambitious with your repayments, you risk overextending your finances and coming up short at the end of the month. Too cautious, however, and you risk drawing out your payments, paying extra in interest and limit your quality of life. Find a sustainable balance that allows you to stay on top of your finances without placing too much strain on your lifestyle.

The perfect car loan is waiting for you

Staying on top of your car loan begins with getting the right loan from the right lender. Hit the road with car finance from a friendly and helpful loan provider. Don’t let bad loan terms stall your engine. Contact Max Loans today for a free quote!

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This publication should not be deemed as financial advice. While all care has been taken in the preparation of this publication by the writer, Max Loans and the writer give no warranty as to the accuracy of this publication and whether the information contained within it is appropriate for your individual circumstances. No responsibility is taken by Max Loans or the writer for any errors or omissions in this publication. You should seek specific financial advice appropriate to your individual circumstances before acquiring or disposing a financial product.