Do not get fooled by clever marketing techniques and social influencers, you are the one paying for what you purchase, no one else.
We are bombarded with advertising messages daily. These have the potential effect of making us feel insecure; am I looking good enough, how should I be living my life, what car should I be driving?
Getting into debt by making purchases that stretch your budget beyond your means, whether it is a big-ticket item such as a vehicle or a pair of shoes, is not a responsible financial decision.
This is especially the case if you are a recent graduate or young professional starting out in the workplace and looking to buy your first car. Whether it’s a reliable used model or brand-new off the showroom floor car, the thrill of owning your own set of wheels comes with its own set of financial responsibilities.
“The priority for young graduates when purchasing a vehicle should be that they are able to realistically afford it, while ensuring that this additional asset does not compromise their financial situation. Instead, it should contribute positively to their new work lifestyle and sense of independence,” said Kutlwano Mogatusi, WesBank retail’s communications specialist.
Do not let peer pressure or the advertising messages cloud your judgement in terms of purchasing the vehicle you can afford. The general rule is that you shouldn’t spend more than 20% of your total income on car repayments. It is also important to budget for the other expenses that come with vehicle ownership such as fuel, insurance, maintenance and service costs – in addition to keeping up with all other financial commitments to maintain a positive credit history.
The WesBank online affordability tool gives you a realistic range of finance options for the vehicle you have in mind, based on your financial profile. While the lack of a credit history for many young professionals can be a stumbling block on the path to vehicle finance approval, WesBank has put a special vehicle finance deal in place where a credit history is not essential for graduates if they meet certain other criteria.
“Choosing the car you can afford, and not necessarily the one you really want, is an indication of exercising financial maturity, discipline and independence that can only benefit you in the long run. Remember that when you’re buying a vehicle, you should buy with your head and not your heart. This means knowing your budget, sticking to it and being realistic about the car you’re looking at.
“Managing all the expenses that come with owning a car should never get to a point where you feel that you have bitten off more than you can chew. Be sensible and be responsible,” concluded Mogatusi.