6 Ways to Minimize the Cost of Your Auto Loan

Let’s face it, cars are expensive. It’s not only the price of the car, but also the gas, insurance, maintenance, car washes, and more. For most of us, there are also considerable costs associated with the auto loan. With the economy as it is, every expense is worth examining.

Use these strategies to save money on your next auto loan:

      1. Improve your credit. Nothing has more impact on the terms of your loan than your credit score: the better your score, the lower the interest rate. If your credit history is sketchy, it’s going to cost you. So if you have credit problems, put off buying that new car until you’ve done some work on your credit.
      2. Avoid small loans. In many cases, interest rates tend to be higher on small loans. If the car costs less than $5,000, then it’s best to simply save up ahead of time and pay cash for the car. If you’re desperate for a vehicle, however, this may not be an option.
      3. Refinance. You can refinance an automobile at a lower interest rate if interest rates have fallen since you bought the car. This especially makes sense if you’ve also been able to improve your credit since you obtained your loan. You could easily save $100 per month by refinancing.
          • With the subsequent reduced payment schedule, you can apply the extra you’re saving toward other investments or you can pay off your car sooner.
      4. Shop around for financing. It might be easiest to get your financing at the dealership, but it’s rarely the best place. Finding a better financing offer means extra money that could be in your pocket instead of the dealer’s.
          • Check out what the dealer has to offer, but get some other financing quotes and see what makes the most sense.
      5. Consider leasing. While leasing is usually considered to be more expensive in the end than purchasing, it can make sense if you never own a car long enough to get it paid off.
          • Your monthly payment will likely be less and the taxes are less, since you usually only pay tax on your payments, not on the value of the car.
      6. Find a less expensive vehicle. Cars today are almost universally quite reliable. There’s almost no practical difference between a modern $10,000 car and a $100,000 car. All the extra cost has little to do with how reliably or safely the car will get you from point A to point B.
          • Consider purchasing a slightly used automobile to really save some money. If you can find a car that’s almost new with low mileage, you get all the advantages of a new car, including the warranty, without the new car cost.

There are several ways to save money on your next auto loan. If you have the luxury of time on your side, fix any credit challenges you may have and shop around for the best financing terms. Where there’s a will, there’s a way. Do what you can to keep as much of your money as possible.

Discover the Ideal Age to Start Saving for Retirement

Most young adults don’t think about saving for retirement. There are other financial priorities, including marriage, paying off student loans, buying a first home, or preparing for the birth of a child.

Typically, people start preparing seriously for their retirement once they reach their 40s. If you wait that long, though, financing your whole retirement will take some hefty saving. Starting your savings as early as your 20s makes a real difference. By starting in your 20s, you can put away smaller amounts plus you’ll amass a larger nest egg in the long run.

Saving for retirement early in life gives you the possibility to gain hundreds of thousands of dollars in free interest before you retire!

Ideally, you should start saving for your retirement as soon as you can afford to. Let your first regular paycheck mark the beginning of your retirement savings. Saving a little bit at a time makes a difference if you start early, and you’ll be glad you got a head start on putting money aside as retirement approaches.

Advantages of Getting Started Early

Consider these advantages of saving for your retirement in your early 20s:

    1. Affordable deposits. Saving for your retirement won’t put a drain on your finances as long as you base your savings on what you can afford. Saving now will allow you the smallest possible deposits because they’ll have many years to grow.

    2. Retirement accounts are a great safety net. Cashing out a retirement account early certainly isn’t recommended, but you’ll always have this option if you find yourself in a difficult situation.

    3. Time for your money to grow. You’ll have more funds available when you retire, thanks to interest and investment returns adding up over the years.

    4. Time to recover if something happens on the markets you invest in. The stock market can crash, but your position might gain value again in the future.

    5. Having time to recover also means you can afford to take more risks. This means you can pick high risk investments with a much higher potential return and see your portfolio grow faster than it would if you stick to safer investments.

    6. Tax advantages. Your contributions to qualified retirement plans or IRAs can reduce your income taxes.

Great Ways to Save and Invest at an Early Age

There are some very good options available to you to start saving in your early 20s:

    1. A 401(k) through your employer. This is a great option, especially if your employer matches your contributions. There are two common mistakes to avoid when it comes to 401(k) accounts:
        • Opting out of a 401(k) account. A 401(k) account is really the easiest way to start saving for retirement. Plus, if your employer matches your contributions, you’re just leaving free money lying on the table if you opt out. After 40 years of investment returns, this free money could be worth $10,000, $100,000, or even more.
        • Cashing out or losing your 401(k) when you change jobs. Instead, you can either roll this account over into an IRA or to a new 401(k) through a different employer.
    2. Open a Roth IRA if your employer doesn’t offer retirement benefits. Go over your budget to figure out how much you can realistically contribute to this account on a monthly basis and stick to this goal. Even if it’s a small amount, go for it!

The key is to get started saving on a monthly basis. Develop this habit and it will serve you well for the rest of your life. Later on down the road, as your income increases, you can always increase your savings amounts.

Getting started early, making saving a habit, and keeping track of how your investment accounts are performing will help you save up enough to retire comfortably.

There are no excuses not to save, since you can get started with small monthly contributions and can open an IRA account if your job doesn’t offer a 401(k). Get started today and fund a retirement you can really enjoy – all with small contributions! You’ll be glad you did.

Tips for Getting the Most From Your Savings Account

Do you feel like you’re saving your money with a financial institution in vain? Does it seem like you’ve had your money there forever but you’ve earned very little on your investment?

Even though banks pay very little interest, there are some simple strategies you can use to get the most out of your savings account.

Easy Ways to Improve Returns

If you prefer regular savings accounts to more complex investment arrangements, there are a few things you can do to ensure you make the most returns on your money:

      1. Choose online savings. Online savings accounts are fast becoming the popular choice of people who want to keep it simple where their savings are concerned, yet get good returns.
          • Online savings accounts offer the option for you to earn good interest rates on your deposit. These accounts would certainly take care of that concern!
          • You earn your interest safely. As long as your account has $250,000 or less, it’s automatically insured by the FDIC. This means that you won’t be negatively impacted by any financial crisis that could affect monies saved.
      2. Look for higher interest rates. Believe it or not, not all savings accounts are the same. There are actually some that offer better interest rates for depositors and these are the ones to consider if you want to see your money working for you. At the end of the day, your mission is to be able to earn money on your savings, so why not earn all you can?
          • The more you save, the greater the impact of a higher interest rate – even if it’s only slightly higher. As your savings grow over time, the difference could be significant.

      3. Look for accounts with high opening bonuses. Some savings accounts offer high bonuses once you open a new account. These accounts give you a good head start where your savings are concerned and can end up working for you, especially if you leave your money to grow.

      4. Know when interest is calculated. If you’re able to study the pattern of your savings account, you should be able to determine at what point during each month interest is calculated on your savings.
          • A trick to ensuring you collect higher interest each month is to ensure your balance is as high as possible right before interest is calculated. That way, you’ll get the satisfaction of seeing higher interest amounts in your savings account.

Take Your Savings One Step Further

If you have a bit of an adventurous streak, you could consider those savings accounts that are fixed term and offer higher interest rates. These include viable options like certificates of deposit and money market accounts. Of course, there is more risk involved, but nothing that a little focus and research can’t overcome!

Having a fixed term savings account can be challenging, especially if there is an emergency need for the money. However, if you’re able to hold out until the end of the term, then you’ll reap better rewards in more interest earned.

Fixed term savings options like certificates of deposit guarantee higher interest rates the longer you save your money untouched. That might be the option for you if you’re not getting what you feel you deserve from your existing savings arrangement.

It’s frustrating to save with a financial institution for your entire life without seeing positive returns from it in a reasonable timeframe. Put a little thought into the process as well as the options available so you can find the most practical and attainable way to earn on your savings.