This whole journey of getting a new car started when this thought came to my mind one fine afternoon day..........
"I want something new!" Obviously, it doesn't require a rocket scientist to come up with such idea!
So what did I do to put that idea into an action?
1. Have a date with my left brain : Check the finances and see if it makes sense!
First thing is first. I need to check with my left brain to see if getting a new car is a viable option: Ask myself if I have stable income, check my bank balance, scrutinize/audit my budget,
I do not like the idea of tying down large amount of capital to a depreciating asset like cars, so I will be okay taking loan out and making payment.
In such case, Consumer Reports’ financial experts recommend that your total debt payment be no more than 36 percent of your gross income. Going by this rule, you can use the following steps to determine how much you can afford:
- Calculate what 36 percent of your gross monthly income is.
- Itemize and total all your monthly payments, including your mortgage or rent, credit card bills, and other installment loans.
- Subtract the total of your monthly payments from the 36 percent figure.
[ Source :: Consumer Reports ]
Coming up: 2. Have a date with my right brain : What car do I desire?