The Ultimate Guide to Saving on a Car

save on a car

Many older teens and young adults do not have a car to travel to school, college, work, or just around town to run errands. When you need a car, new or used, there are a few smart savings tactics you can use. These will get you behind the wheel and on the road in your car in no time.

Calculate how much money you need

Find the type of car you want to buy.

Before you know how much money you need to save on a car, you’ll need to decide a few things. Figure out if you want a new or used car and what type of car you want based on what you will primarily use it for because that will also affect the price. You can either decide on the exact make and model right away or leave those details for later as you might change your mind. However, you should choose the type by asking yourself: do you want an eco-friendly car, something more compact or larger like an SUV? Do you want a fast car with a big engine or economic fuel consumption? What functions should your car have and how important are safety functions? Do you just commute to work or school and back? Do you plan to go on excursions? Maybe you need a vehicle with plenty of room to move things around. Knowing the answers to these questions will make saving for a car much easier.

Choose how you want to pay for your car.

There are several ways to buy a car, such as paying for it in cash, leasing it, or financing it. Before you know how much money you need to save, you should decide what type of payment method suits you best. If you have a good and secure income, you can get a personal loan from an institution like a bank. A dealer loan is another option. In this case, you get the loan from the dealer instead of the bank. You typically have to pay between 10% and 20% down and then make monthly payments until you’ve paid off the rest of the vehicle. You can also lease the car, meaning you make monthly payments for the vehicle for a set period.

Decide how much you want to spend.

Now that you know what type of car you want, it’s time to calculate how much you want to spend on your vehicle (whether you’re making monthly payments or trying to save until you can buy your car with cash) .

Calculate your current income and expenses.

Knowing exactly how much money you make and spend each month will give you a good idea of ​​what you can live without and how long you need to save. Many online tools help you figure out how much money you have available. Research other costs you may incur. Remember, you’re not just saving for a car but also for insurance and taxes. It’s also a good idea to have some spare for any repairs, especially if you’re buying a used vehicle.

Choose the date you will buy your car.

Having an appointment to look forward to will help you manage your monthly budget. It also gives you an incentive to stay honest when saving and budgeting. Maybe you need the car by a certain date. Maybe you’re going to college, moving to a new city, or having a job that forces you to drive more. Having a date in mind will help make saving for a car a top priority. It will also discourage you from buying things you don’t need.

Start keeping a journal of your spending habits.

If you’re already doing this, you’re already one step ahead! Whether you’re using a notebook or an app on your phone or computer, jot down everything you buy, from food to clothes to bills for electricity, water, etc. This will give you a clear idea of ​​everything you buy and show you how much money you spend unnecessarily. Maybe you go out to eat several times a week. You’ll quickly get an idea of ​​how much you can save on your car when you see the unnecessary expenses.

Develop a savings plan.

Now you have an idea of ​​what your income and expenses are and when you want the car. Now you can create a schedule to help you start saving right away.

Start saving for the car

Open a savings account.

If you don’t already have a savings account, now is a good time to open one. There you can deposit your money and don’t have to worry about spending it. Tell your bank what you’re saving money for so they can help you find the best type of savings accounts for your needs.

Get a piggy bank.

Sometimes the old ways are the best. Having a savings account is great for paychecks, but you also need a place to deposit your extra money. You’ll be surprised how much you can save with change. Take the change and put it in your piggy bank whenever you use cash.

Transfer a certain amount of your salary to your savings account every month.

Now that you know how much you need to save make it easy on yourself and transfer a percentage of every paycheck directly into your savings account. If you get your salary transferred directly to your account, you can set up a standing order with your bank for regular transfers from the checking to the savings account.

Only buy what you need.

Not spending money on things you don’t need can be hard, especially when it means not being able to go out with your friends. But if you stick to your plan and budget, you can save up for a car a lot quicker and feel better in the long run. Stay motivated and encourage yourself to save by printing a picture of the car you want and sticking it in your wallet. That way, you’ll be reminded of what you’re saving for every time you buy something. Make a playlist of your favorite songs and consider the price of the car by not listening to them until you have your car. If you really want to encourage yourself to save, try taking walks. See how long it takes to get anywhere. The next time you’re tempted to buy something you don’t need, you’ll remind yourself how uncomfortable it was to have to walk.

Find deals and coupons on everyday items.

This may not be that glamorous, but buying unbranded products will save you money fast. Using coupons is a good way to get what you need at a good price.

Search for your perfect car

Internet search.

This is less about actually saving for a car and more about helping you save. Even if you know what type of car you want and how much you need to save, it’s nice to keep track of offers from different dealers. This way, you can see what your best funding options are.

See the car in person.

Check out the vehicle you’re saving on. Seeing it in person will make it more tangible and give you the motivation to keep saving diligently. Take a test drive—experience how it feels to drive the car. Not only will this help you know if this is the right car for you, but it will also protect you from unnecessary spending. When you’re tempted to shop for that new outfit or go out to eat, remind yourself of how it felt to drive your car.

Use the dealerships to your advantage.

Find several retailers across the city that offer the make and model you’re looking for and get quotes. Be honest that you’re poking around and have spoken to other merchants to get the best price. Dealers want to sell their cars, and if they know there’s competition, you can find a great deal. Don’t let a lower offer influence your savings plan. You might find a cheaper deal on the car you want, but that doesn’t mean you should save less. Every extra money you save keeps things running smoothly. If you have some extra money, you can make a bigger deposit. Prepare for possible repairs or buy the first few tan fills.

Use tools from the internet to help you save and research.

There are several ways to calculate the cost and help you get a great bang for your buck and know your best options. Some sites have many other helpful tips to ensure that once you’ve done all the hard work of saving, you get the great car you deserve.

Earn some money on the side

Sell ​​what you no longer need or use.

Saving for a car doesn’t just mean spending less money. Host a garden or garage sale to sell old clothes, items, and furniture you no longer need or use. You can also sell old electronics on eBay for a quick buck.

Pick up a few extra shifts at work.

Tell your boss you’re saving for a car and want to work more hours. Or offer to cover any shifts your employees can’t keep.

Find a second job.

If you have a job that pays you a salary, or if you’re not getting enough hours at your current job, consider looking for a second job. It’s not the funnest way to pass your time, but it will make saving for a car easier and faster. You’ll thank yourself for all your hard work when you get behind the wheel of your new car. If you’re a teenager saving for a car, ask your parents or neighbors if there’s any work for you. Take care of children, walk dogs or work in the garden.


If this is your first car, you should consider buying or using something cheaper. There is a chance that sooner or later, you will break down. With a cheap car, repairs are sometimes cheaper. Always keep an eye on your savings. The better you are at saving, the more likely you’ll be behind the wheel. Don’t just settle for the cheapest option. Find something you like that will last a while. Don’t forget the insurance costs. Although many think new cars are more expensive to insure, this is not always the case as newer models usually offer better safety features.


Beware of scams or false advertising. You can always buy a car from a third party, such as eBay. Just ensure that the vehicle’s seller has the right to sell it and that it is as described.


Helen Miller

Helen Miller is a freelance writer at Usevoucher. She covers personal finance topics in a syndicated column that appears in Financial Planning Magazine. Her work has been featured by Market Watch, Digital Journal, Chicago Tribune, USA Today, and Yahoo Finance. Helen has a bachelor’s degree in finance from the University of California, Los Angeles.