This is especially true for many teenagers or college graduates who are eager to buy that first car, but lack the necessary funds. What to do?
This is a common problem for lots of folks buying their first car. It can be solved in a number of ways.
There are essentially four ways to get money for a car:
- Save the money
- Be gifted the money
- Borrow the money
- Earn the money
Let’s take a closer look at each of these ways:
Save the money
Most people are able to save some money from small gifts, part-time jobs, or by selling some things they own. This might not be the best or the fastest way to get money for a car, but if started early enough, it just might get you enough to get a “starter” car or make a down payment on a loan. Buying an older less expensive “starter” car allows you to be driving while you save additional money for a better car down the road (pun intended).
Be gifted the money — or the car
Not everyone will be fortunate enough to have family or relatives who can gift them the money for a car. But it’s worth a try even if you think it’s not possible. Maybe everyone doesn’t know you want a car, and that you don’t have the money. Let them know. Let the power of suggestion work for you. Maybe someone in the family has a car they don’t need and will donate it to you.
Borrow the money
Borrowing money for a car implies that you have, or will have, some way of paying back that money. If you are not yet 18 years old you can’t legally get a loan from a bank or through a car dealer. However, you can have a family member get a car loan and you can make the payments, assuming you have a job or other source of income. Understand that the car and insurance would be in the family member’s name, even though you make the payments. After you are 18, the family member can “sell” you the car so that the title is in your own name. Unfortunately, at 18 years old, you will not have a credit history, which is required to be approved for a loan from a bank or through a car dealer. The solution for most people in this situation is to get a family member to co-sign a loan with them. This allows you to make the payments and establish your your own good credit history for the next time you need a car loan — or credit card or home mortgage. For more details, see our article Do I Need a Co-Signer?
Earn the money
There are thousands of ways to earn money for a car — or anything else — but there may only be a few that make sense for a given person in a given situation. If, for example you are a teen or young adult still in school your opportunities may be limited. However, most young people are active on the Internet and the Internet actually is their best potential source of income. Unless you do something like buying and selling on eBay, most other solutions require that you have a blog or a website, both of which can be done for free or for very little cost. You then make money by advertising products and services on your site, for which you get commissions. For example Amazon has thousands of products. By signing up for their free associate program, you can place links to any products you like and receive money when someone visits your site and buys the Amazon products. Many other companies have similar programs. Once you set the links on your blog or web site, it runs on automatic pilot. We suggest that if you are interested in this kind of solution, you consider an all-in-one service such as Site Build It (SBI) that takes care of everything for you. Sure it costs $299 but you get a working money-making web site and an amazing set of tools and services for the money. You should make back that $299 and much more in no time, which makes it a good investment.