So, first,check out our car buying tips:
Pick a model of a car you dream of buying
This step will help you to figure out the amount of money you’ll need to save up. Will it be a new or a used car? High-performance one or a fuel-saving option? Decide on a make, model and a year, the type of transmission and other details. Don’t be guided by the official stats only. If you want to find a safe and reliable car that fits your needs, make sure you check out customer and professional reviews. Listen to what real people say about this make and model and about how it cost them in 3 or 5 years after the purchase. Remember that while saving for a vehicle, it’s crucial to save on the vehicle as well!
Got the picture? Of course, you can change your mind later… But this first “visualizing” experience has a great power to get you through the whole process of saving.
Decide on the payment method
Many people skip this step thinking it’s unimportant. But if you are going to make the purchase through financing, it is mega important. A couple of percent difference in the interest rate can obscenely increase the price of your car in the long run. So if you cannot buy the car in full and have to rely on a loan, start shopping for the lowest possible interest rate now. Do your research and compare rates at different dealerships or consider searching for low-interest loans online.
Define a budget and the pace
Now that you already know the type of the vehicle you need, you can decide on how much you can spend on it without feeling guilty. Now ask yourself how much money you can set apart from your every paycheck. Then, do your math and find out how many months separate you from your dream car. Or the opposite, if you need a car in a specified time frame, calculate how aggressive you have to be in your monthly savings.
Save on a consistent basis with a savings account in Kenya
The math can sound really simple, but saving up the required amount month after month isn’t simple at all. We, people, are lazy creatures that easily get distracted and demotivated. That is why we need a system that would keep us faithful to our goals and make savings happen automatically. The best trick to guarantee such consistency is to open a savings account and get your savings deposited on it on a monthly basis.
If you want to get the best boost for your savings, opt for a high-interest savings account with a low-interest loan feature. Check out Mombo saving account that enables you to grow your monthly instalments (minimum KES 3,000) at the annual interest rate of 6% and then take a fivefold loan just after 3 months of membership. So once your savings reach one-fifth of the car price, you can buy a car right away and continue to pay off the loan at the lowest possible 12% interest rate. No dealership or bank ever offered such favourable terms.
Become a car owner 5 times faster!
A 25-year-old lady who just graduated college asked us if we could finance her purchase of a car if she saved with us. She enrolled in MOMBO and started saving in July 2015. By March 2017, she had saved KES 150,000. We financed her to get a car worth KES 750,000. She is still paying comfortably and is even considering disposing it and upgrading to a better car.
Saving up for a car can be tricky and painfully long unless… Unless you leverage the 5-fold loan feature that gets you behind the wheel of your own car 5 times faster!