Transcript A Roof Over Your Head

Game of Life
Making the right choice
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Before you begin decide how much you can afford
to spend
Decide which car models and options interest you
Research the reliability and quality of the cars you
are interested in
Find out what warranty options come with the car
Search for different financing options that are
available to you
What Can you Afford
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Plan to spend between 10-15% of your total
monthly budget on all car expenses
 This includes insurance, maintenance, licensing,
etc
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New cars will come with a warranty that will cover
major repairs but not routine maintenance.
Newer cars = Higher Insurance Costs
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New or used?
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Buying a new car can be tempting and has
benefits:
 No previous owners or problems
 Built to your liking
 Full factory Warranty
Used cars can provide a reliable, financially-wise
choice
 Look into lease returns and you may be able to
find a car that is only 2-3 years old but save 3040% over a new car
 Certified used cars can often come with a
warranty of 12 months or more
Rules for Buying Used
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Do your research!
 Check the vehicle history if it is available.
 Make sure the car has never been totaled and
that you are aware of any previous accidents
 Get it checked by your own mechanic or
mechanic service such as BCAA.
Search used car dealers and individuals
Find the trade-in and retail values for the
cars you are looking at
Try to arrange a test drive
Buying or Leasing
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Why lease?
 The advantage of leasing is that you get a new
car every few years while letting the dealer
worry about selling it off eventually.
 If you want to avoid the down payment needed
for financing a car purchase and don’t drive
more than the allotment per year
More about Leasing
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Drawbacks of leasing include:
 When your lease-option expires you must decide to
either buy the car outright (you end up paying more
in total) or returning the car.
 If you think you may want to buy the car do it from
the start.
 Payments will be lower than a purchase so don’t
get pulled in unless you know this is what you want.
Buying
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If you decide to buy a car make sure you do the
following:
1. If you can pay it all in cash and not go
outside of your budget, do it.
2. Evaluate your loan or financing options.
The dealer options are not always the best
choices and may have higher interest rates.
3. If you are financing your car purchase, make
sure the monthly payments will stay within
your budget
Shopping for a Car Loan
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You will need to look at the following items when
deciding on a loan:
1. Annual Percentage Rate (APR) – The
interest rate you will be charged at.
2. Length of the loan
3. Monthly Payments
4. Total Finance Charge
5. Total to be repaid
○ Check out a Car Loan Calculator
Where to Get Financing
You can get financing from car dealerships
or from a bank loan.
 Shop around to make sure you can find the
best deal
 Some dealerships will offer 0% financing
on certain makes and models. This option
can be worth looking into.
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Sample Loan – $25000 car
purchase
How much of that is interest payments?
Check it out.
Example calculations
Estimating the total cost of a loan:
 Amount of loan x APR x Number of years
 $10000 x 0.10 x 5 years = $5000
 $5000 + 10000 = $15000
 Monthly payments
 Total to be paid/# of months
 $15000/60 = $250 per month
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True Cost
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Owning a car comes with the following costs that you
may have not considered:
 Depreciation (loss in value of your car)
 Interest on a loan
 Insurance
 Registration, License fees, taxes
 Gasoline
 Regular Maintenance
 Fluids
 Different season tires
 Parking
 Air Care
Insurance
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All drivers in B.C. must have Basic auto insurance
coverage. Basic Autoplan includes up to:
$150,000 for medical and rehabilitation costs for
each injured person
$200,000 for damages claimed by other drivers
$1 million per person if the at-fault motorist is
under-insured.
Where to find your Car
Many dealers offer ‘Build and Price’ options
on their websites for new cars.
 Most new and used car dealerships have
websites that list their current inventory of
new and used vehicles
 To find private sellers you can search
websites such as Kijiji or Craigslist
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It’s time to find your ride!