The Emergency Fund
You never know what can happen, right? You can run into car trouble, a crashed computer or even unexpected health issues. No matter what happens, you should be prepared financially to handle the unexpected costs that might come your way.
To do this, you should build an emergency fund. An emergency fund will offer peace of mind and give you a bit of a safety net. Here’s how to get started:
Build your emergency fund based on your income. When you receive your monthly or weekly paycheck, allot a separate, predetermined amount for savings, spending and for your emergency fund. Although you might take your time building this fund and it might start quite small, the point is, it will be there when you need it.
Don’t ever tap into the account until you absolutely need it. If you are thinking about dipping into the funds, think about the potential emergencies that could arise; hopefully, this will curb your urge.
If something does happen, calculate the costs and be ready to use the funds. Although you might feel a little guilty about spending the money you worked so hard to save, remember it is there specifically for emergencies and was created to help cushion your pocket when these things happen.
An emergency fund is a great thing to have and allows you to be ready for the worst. And think about it – if you never have to use the money, it is there as additional savings and will make you feel more comfortable about your financial status.
Dealer Financing Isn’t Always A Deal
When you are getting a new – or gently used – vehicle, sometimes excitement takes over and a fast-talking salesperson can pressure you into making a not-so-great decision. The way they talk, it may seem like dealer financing is your best option, but it’s not always as affordable as they make it seem. The promises made by dealers generally fall under the “Too Good To Be True” category. Often you find out that lesson when it’s too late.
First off, less than 10% of applicants actually qualify for the 0% financing dealers advertise. They certainly don’t tell you that! Those slick salespeople earn their reputation. In most cases, the rate you qualify for will be much higher. Once the financing process is started, many people just go with what the dealer has to offer.
More shockingly, however, is even if you did qualify for the 0% financing, it’s probably not the best deal. How’s that possible? How can you beat 0%? Easy. When a vehicle is sold, it often comes with a rebate. If you take the rebate, you are financing the vehicle at a lower purchase price. Check with your credit union, and get pre-approved. Chances are a rebate and a rate from your credit union will result in lower payments each month. With the extra cash in your wallet each month, you’ll have enough to gas up your new ride!