COLUMBUS, Ga. – The car industry is booming here in the United States and it could be a sign the economy is doing well. However, according to Consumer Reports it means we Americans have undertaken $1 trillion in car loans and leases.
A local financial expert says you may want to hit your breaks if you’re about to jump on the bandwagon and get into a new car too.
Tyler Townsend says consider saving money first and then buy what you can actually afford down the road.
Townsend also says his advice is not popular, but the alternative is ugly too he says, “Take out loans you are paying other people just for that ability to borrow the money. It’s better to pay that money to yourself each month in advance of the car purchase and then you are receiving that income.”
This financial guru says he always takes the conservative route, but says there is one exception to his rule: if you are buying your first car it’s acceptable to take a loan. Either way though he says make sure it’s a small loan.
Townsend says there are three great life events worth borrowing money for because they are investments:
- furthering your education
- starting up a business
- buying a home
If you do take a loan for one of these three major events he says don’t be in a rush, but shop around for the best deal.
Patience can pay pretty!