How much should a college student save for a car?
In general, experts recommend spending 10%–15% of your income on transportation, including car payment, insurance, and fuel. For example, if your take-home pay is $4,000 per month, then you should spend $400 to $600 on transportation.
How much should I have in savings before buying a car?
Depending on your annual income, the amount you should save for a car will vary. It could take you years, but saving effectively has some serious benefits. Most retailers would suggest spending 10% to 50% of your gross income. But a good rule of thumb is 10% for used cars and 20% for new.
Can I afford a car in college?
Yes, but not easily. Lenders hesitate to lend to degree-seekers without full-time jobs. However, they can opt for a buy-here-pay-here lot, which come with high interest rates. Alternatives could require a cosigner with good credit and high income who is willing to put their name on the car loan.
Is it worth bringing your car to college?
Your car allows you to save on shopping: Bringing your car with you to college might come with some additional costs, but it can also help save some money as well. Having your car with you can help you save a lot of time that might have been wasted on things like trying to find the right train or flight layovers.
Do college students need a car?
Many students don’t need a car at college, especially if they don’t have a reason to leave campus or if home is too far away to drive to over breaks. You’ll want to consider whether home is within a reasonable driving distance, or if your student needs to travel off-campus often for work.
Should a college student finance a car?
Do NOT Use Student Loans to Buy a Car The reason that car loan terms are usually shorter than federal student loan terms is that cars depreciate. By funding your car with a student loan, you won’t even start paying it off until after you graduate, and you will likely be paying it off for 10 years at a minimum.
Why can’t college freshmen have cars?
Some schools discourage students from having cars on campus. The school explains that keeping freshman on their feet makes them more involved in on-campus activities, and it also reserves parking space for upperclassmen. Then again, many colleges do encourage you to bring your car.
Should a freshman take a car to college?
If you want to help facilitate your child’s independence during and after college, allowing them to take a car is a great way to do so. Not only does a car allow them to go places, but it can also help teach them the responsibility needed to maintain a car.
How can I save for a car at 17?
How to Save for a Car as a Teenager
- Know the destination. Your first step is to set a savings goal.
- Plan your route. Once your savings destination is set, you can start figuring out how you’ll get there.
- Have a place to park your money.
- Rules of the road.
- Pick up speed.
- Arriving at your destination.