13 Common Financial Mistakes You’re Probably Making Right Now

A car purchase is a big deal. Whether you’re investing in your first vehicle or replacing an ageing one, the choice seems limitless as you explore models on the market. A car offers increased opportunity for a variety of reasons. Selection of jobs and places to live becomes more abundant, and personal transportation improves leisure opportunities, too. Car buyers can easily fall into the trap of buying a new car model, however. A new car comes along with a flashy exterior and some of the best amenities around. But new cars are substantially more expensive, contributing to one of the most common financial mistakes you can make.

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Experts suggest the purchase of a new car shouldn’t exceed 10% of your gross income for the year (via CNBC). This is because the price tag is only one aspect of a car’s overall cost. Yearly maintenance, taxes and registration, gasoline, and, of course, the interest you’ll pay if you’re financing the vehicle, all come together to inflate the cost of car ownership.

The average annual salary in 2023 is just under $60,000, per Forbes Advisor, meaning the average car purchase should come in at around $6,000, according to this mindset. While the glitziest ride around might not be in the cards with this kind of budget, a dealer-certified preowned vehicle often comes with warranty coverage and many great years still ahead. An emotional car purchase is a surefire way to dig a financial hole. Stay grounded with this critical expense for the bet in continuing budget stability.

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