Questions to ask yourself when deciding if you can afford your dream luxury car

Everyone has a dream vehicle, but it can seem unattainable unless you’re wealthy and can afford to splurge on your favourite set of wheels. Most people believe they either have to be wealthy, win the lottery or win a car competition to afford their luxury car.

However, this doesn’t have to be the case. With proper planning and being honest with yourself about where you are financially, your needs and your wants, you can work towards your dream. Owning your dream luxury car is possible, and these questions will help you see whether now is the right time to purchase your dream vehicle or if you still need to do some planning.

Here are five questions to ask yourself when thinking about purchasing a luxury car:

1. How do your finances look?

Before anything else, you need to look at your finances. This will help you determine what you can afford, whether you need a second income to supplement your expenses, how much your expenses cost and more. Without looking at your finances, you would be going into this expensive decision blindly, which is the last thing you want. When you do purchase your dream car, you want to ensure that it makes financial sense and won’t become a burden in the long run. Or, even worse, needing to sell it because you cannot afford it any longer.

When looking into your finances, ask yourself the following:

• How much of my salary will go to vehicle finance, and will I afford to keep up with these monthly expenses?
• Am I going to be able to cover the insurance costs of a luxury car?
• Do I have a stable job or business that will ensure I can stick to my financial agreements?
• Does my salary fit the average income of luxury car buyers, or am I taking on more than I can handle?
• Will this vehicle fit into my personal life and daily activities, or will I need a second car? If so, will I have the finances to take care of two of them?
• How long do I plan on keeping this vehicle?
• Will I use it for many years to come, even after I’ve finished paying it off?
• How much does petrol, repairs, service and maintenance cost and will I afford it?
• Asking yourself these questions will help you get an idea of how much this vehicle costs. Can you afford it? Are you secure enough for this decision, and will this vehicle bring you joy and satisfaction while also ensuring it makes your life easier?

2. How does your credit score look?

When it comes to purchasing an expensive car, most people need additional funding. This is when you need to apply for vehicle financing to ensure you can afford your luxury vehicle. When it comes to buying a luxury car, the financial aspect is what holds most people back.

You need to have an impeccable credit score and payment history to show lenders that you aren’t a high risk for the amount of money they would potentially loan you. Your credit score can also potentially help you save money as you may get a competitive interest rate if you’re seen as low risk.

This, in turn, enables you to save money in the long run. Make sure you go through your report to ensure it has the correct information so that you don’t experience any issues when searching for finance options that work for you.

3. Do you have savings you can use?

If you have a savings account with no specific use, that can be a good thing for you. Lenders will use a luxury car finance calculator to see whether you can afford the monthly instalments that come with your new car or not. If you go to a lender with a deposit, this can work in your favour.

For starters, it shows the lender that you know how to use your money which can help you get approval faster. You also get to ask for more money as you have your own contribution to go with the loan amount. And, lastly, those sayings can go towards a deposit that impacts your interest rate, helping you lower your monthly instalment and paying it off faster.

4. Will you be able to maintain your car financially?

One way for you to know if you can afford a luxury car is if you can also afford its upkeep. As a car owner, you know that the expense of a vehicle isn’t only the monthly repayments but also the upkeep. You need to research the luxury model and brand of the car you want to see if you can afford to buy it.

This includes everything from petrol, parking fees, registration and inspection fees, repairs, maintenance, insurance, car parking (you might need to build a garage for security reasons and to ensure its exterior doesn’t get damaged). You also need to ensure that there are mechanics near you that specialise in the car model as you may need assistance in the future, and it would make things easier if you had a reputable mechanic nearby.

5. Do you live in a safe neighbourhood?

The crime rate in South Africa continues to be a major concern for South Africans. While there has been a decline in crime in the last year, the numbers are still high and are a cause of concern. If you are planning on buying a luxury car, you need to consider the area in which you live.

This will be something your insurance company will consider, which can cause your premium to skyrocket. You need to be sure that you can afford your insurance costs, especially if you live in an area that isn’t considered the safest.

6. Can you finally afford your dream luxury car?

Everyone has the right to live their dream, and there are ways to ensure that they become more than just a dream. However, with that comes proper planning and seeing what effect the decisions you make now will have on you in the long term. If you have answered all these five questions truthfully and see that you are on the right track, you are one step closer to owning your dream car.

When you do get yours, make sure you enjoy it because you have worked towards it, so you deserve to. If you’re not financially ready to fulfil your dreams right now, remember that it’s okay, and you can work your way towards reaching it. These tips will not only help you ensure you can afford your dream car but also help keep you on the right track of finally affording it.