How To Be A Sucessful Adult – Buying Your First Car

Buying your first car

Buying your first car can be a daunting task but now that you’re an adult and understand your pay cheque, you probably want to buy yourself a car. Hopefully you planned your budget accordingly! Buying a car is often one of the first big purchases people make. Lots of high school students save up a few grand and buy an old clunker to escape whenever they want.

Don’t write off buying used because you “can” afford new

I don’t know your financial situation but if you’re still in school or freshly out of school, or still have student loans you might want to go the used car route. Used cars don’t get enough credit as a possible money saving device. Used cars allow you to avoid immediately losing 11% of the purchase price after driving it off the lot. This basically means if you buy a car with a 10% or less down payment, you immediately own no equity. It’s basically like throwing away 10% of the purchase price. Here’s an infographic from Edmunds.com(They’re car people)

buying your first car
Source:  How Fast Does A New Car Lose Value

This is all of course based on average driving. Low mileage cars will be worth more, higher mileage worth less. Then of course the condition of them matters, if you don’t look after it and keep up on the maintenance the value drops even faster.

The Pros are obvious of a used car but what are the cons?

Well along with being cheaper, used cars are older and their history can be unknown. Unless you know the owner of the car you’ll have to rely on 3rd verifications. CarProof is a great source that many dealerships will provide you with. It’s essentially a service that tracks the insurance history of a vehicle. This will tell you if it’s had an insurance claim and a brief description with the estimated cost of damage. It also tells you when it was registered and other minor details.

Another downside to buying used is a chance it doesn’t have a warranty. There’s plenty of dealer programs out there that do offer warranties on their models. There’s also third party warranty offers that you’ll most likely get from the dealership for models that aren’t theirs. These can be worth it but you’ll want to go through them in great detail. Make sure you know everything that’s included because like everything else, some sound too good to be true and they usually are.

Financing costs are usually a lot higher on used cars compared to new. Dealerships don’t usually give the really low interest rates like 0% or 0.9% that is often found on new cars these days.  Instead you’re going to be paying interest up around the 3-5% range. This of course depends on your credit, financing terms, and of course where you’re getting the loan.

So why would I ever consider a new car?

Because who doesn’t love that new car smell? Am I right? I have no idea what that new car smell is to be honest.  I’ve never bought a new car and never have I noticed a smell when test driving new ones. What’s up with that phrase anyway?

Ok so new cars aren’t just an immediate depreciating asset. They definitely have some upsides. New cars come with pretty solid warranties. The warranties usually cover in the range of 75,000 to 150,000km or 5-7 years, whichever comes first. Not to mention you might get free oil changes and possibly minor maintenance during this period. Things like free oil changes and tire rotations are not out of the ordinary with a lot of dealerships.

You’re also going to get a better financing rate for a new vehicle purchase. As mentioned above new cars often come with <1% financing, which is almost like free money! They may of course factor that low financing into the purchase price or it could be just part of a special dealer incentive to move inventory. Either way, you may be able to offset some of the depreciation with such a low rate when you compare to buying used.

On top of the above pros to buying new, you have a better chance at getting a more reliable vehicle as well. Provided the vehicle you’re buying isn’t the first year of a redesigned generation they should break down less and be easier to maintain. I’d recommend looking into studies that show the most reliable brands before jumping into something to make sure you’re getting the best value for your money.

So when buying your first car is new or used better?

Ultimately, that’s a personal preference, but both have their pros and cons. The used vehicle is cheaper, but may come with some minor issues you wouldn’t identify on a test drive. The new vehicle will depreciate the moment you drive it off the lot. The bottom line is both choices depreciate and both get you from point A to point B. It’s just your own decision on whether or not you want to stretch your finances for the new model and maybe a little more peace of mind or stick with a used vehicle and save some money.

Personally, I stick with buying used. Cars over the last decade have been extremely reliable and you can save a lot of money to get you jump started on other financial goals.

How to actually purchase the vehicle?

Once you know whether you want to purchase new or used and the model of vehicle the rest is pretty easy.  After that you can visit the dealer and start your shopping. Once you’ve decided on the car the dealer will walk you through the process. The dealership will offer you financing through their preferred bank(or loan shark depending how shady of an establishment you’re shopping).  They’ll also give you a few days to arrange for insurance. The few days to arrange finance and insurance is the most crucial, make sure you shop around for as good of a rate as you can get.

How To Make The Most Money In Professional Sports

How To Make The Most Money In Professional Sports

How to make the most money in professional sports

Do you know how to make the most money in professional sports? I think by now everyone probably knows by now that athletes make a TON of money compared to the average person. They also happen to go broke way more often than they should. So that’s why I’ve built this handy guide for any athletic people that want to make the most money possible! This is clearly not to be taken too seriously, but if you’re an athlete and make a ton of money off this guide, holla back at your boy!

For this article, I scoured the internet to find out the average salary and median salary in most professional sports in North America. I have the English and Indian Premier leagues as well because they’re also insanely popular around the world. Unfortunately for the fans of professional soccer (football for you non-North American readers) I had to limit the number of leagues. I had no idea there were so many until I started researching this article, it’s seemingly endless! For kicks I also included the CFL, because I’m Canadian and it’s almost comical to see what an average salary in the CFL is compared to the NFL.  Read more

These Four Fintech Companies Are Changing Personal Finance Right Now

These Four Fintech Companies Are Changing Personal Finance Right Now

Remember what the internet did for travel? It opened it up to more people and made it easier. Instead of needing to hire a travel agent to plan a trip, we can do it ourselves for free. That’s what financial technology, or fintech, is doing for a lot of areas of personal finance.

We don’t have to spend hours on the phone to find the best student loan refinancing or insurance rates. We don’t have to give our friends cash or gasp! write a check to them when we split the dinner bill, and now instead of having to read dry books or hire a financial advisor to teach us how to manage our money, there are great resources right at our finger tips, just a click away.

These are four companies making a big splash in the fintech world. Read more

How To Be An Adult Part 2: Simple Budgeting Guidelines

Simple budgeting guidelines

How to be an adult part 2: Simple Budgeting Guidelines

Now that you understand how your pay cheques work let’s talk about budgeting that money.

What is a budget?

So what exactly is a budget? Well according to the smart people over at Merriam Webster(the dictionary people) Budget as a noun is defined as:

a :  a statement of the financial position of an administration for a definite period of time based on estimates of expenditures during the period and proposals for financing them
b
 :  a plan for the coordination of resources and expenditures
c
 :  the amount of money that is available for, required for, or assigned to a particular purpose

And as a Verb:
1a :  to put or allow for in a budget
b :  to require to adhere to a budget

2a :  to allocate funds for in a budget <budget a new hospital>
b :  to plan or provide for the use of in detail <budgeting manpower>

So basically, for our purposes of personal finance a budget is the plan you give yourself on how you’re going to allocate your money. It doesn’t have to be spending, if you’re budgeting your pay cheque it should certainly have savings in it. Also you may want to include something towards an emergency fund.

How does one go about making a budget?

Read more

5 Simple financial restraints to change your spending habits

Financial Restraint

5 Simple financial restraints to change your spending habits

What the hell is a financial restraint? Well it maybe a term I just coined. When googled there’s not a lot that comes up! So, my thoughts on what financial restraints are this; it’s anything that keeps you disciplined in your spending. Basically, it’s your sheer determination or habits that prevent you from spending money.  Read more

8 money tips from Johnny Depp’s finances

Johnny Depp




8 money tips from Johnny Depp’s finances

Well in case you have more of a life than me or just don’t care for celebrity gossip, Johnny Depp is (allegedly) going broke. Last year he finalized a divorce settlement for 7 million dollars, which is pennies for an actor that made $55 million for ONE Pirates of the Caribbean movie right? Well it seems that might not be the case! He also recently filed a $25 million lawsuit against his business managers. He claims his funds were mismanaged. We’d really have no way of knowing how mismanaged they were because we don’t have his spending history. (….or do we?)

Depp’s management group of course doesn’t think they mismanaged his funds. They’re so against this idea that they’ve now launched a counter-suit. In the details of this counter-suit they’ve revealed some details of his spending. They’ve also revealed that his monthly expenditures are ASTRONOMICAL. 

After hearing about his monthly expenditures, I asked a few people how much they think Johnny Depp spends each month.  A few guesses were in the tens of thousands of dollars, the majority were in the $100,000 to $300,000 range both of these ranges aren’t enough for ol’ Johnny(that’s what his friends call him…). The highest guess was a million dollars, A MILLION DOLLARS EACH MONTH?!?!  Well that’s not even close!  Read more

7 easy ways to replace cable and save money

7 easy cheap ways to replace cable





Ways to replace cable are ALL around us nowadays, I haven’t actually paid for a cable subscription since I think 2008. The only reason I had cable from 2005 to 2008 is because I was living with two good friends at the time and they both wanted cable, so we got cable. We just went with a very basic cable package so it wasn’t outrageous like today’s prices.  Read more

How To Be A Successful Adult: Understanding Your Paycheck

How to be a successful adult: Understanding your paycheck




How To Be A Successful Adult: Understanding Your Paycheck

This seems like a topic that shouldn’t be needed. Your paycheck is quite simply your pay for performing your job at your place of employment. You have a total at the bottom that tells you how much money you’re getting. What’s so hard about that? Well I consistently see people who have received paychecks for decades tell people incorrectly how taxes work and many other mistakes. On top of that there’s sometimes dozens of additional lines that add and subtract money. There could be anything like health benefits, dental, life insurance, pension, GRRSP, union dues, tool allowance, and a hell of a lot more.  Read more

Looking toward the future: 2017 goals and plans

goals

2017 Goals and Plans

As you may have already read from my Q4 2016 post I achieved about half of the goals I set out for myself and this blog last year. I’m not usually one for New Year’s Resolutions but this blog turns out to be a great accountability check. If I post goals and plans for everyone to see, I better be planning on completing them or else I look like a fool! Or at least I think I do and you guys just don’t care.

For this year I’m going to load myself up with some goals and hopefully crush them all! For the sake of organization, I’ll break them down into a few different categories. So here we go! Read more

3 simple financial resolutions you need to start

3 simple financial resolutions

Happy New year everyone!  

I hope 2016 was better to you than the media portrayed it to be. For the last few months of the year you’d swear nothing good happened. I think those people just didn’t have time to look at their retirement savings. The year was pretty solid overall for the markets, the Dow Jones was up 14.4% as of closing just before Christmas.

3 simple financial resolutions you need to start

Very solid year for the Dow Jones

For Canadians, the TSX composite index was up 17.8% over the same time period! So, if your investments are close or matching these indexes you’re looking at a possible 14-18% return for one year.  To put that into perspective you’ll double your portfolio in 5 years without any additional contributions! Read more

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