It’s that time of year – tax refund time is nearly here. According to the IRS, the average tax refund comes to roughly $3,000. Consider using your refund to make a longer-term investment by upgrading your vehicle. Whether you’re leasing a car, buying one that already has a few miles on it, or getting a brand new ride, you’re going to need all the facts so you can get the best deal for you. Here are our top three tips to help you make the most of your tax refund.
- Find the Car You Need, Not the Car You Want
While we want to feel like the coolest kid on the block with your new ride, it’s important to find the car that is a perfect balance of “want” and “need.” Look for cars that not only fit your lifestyle but could also fit your budget. Take gas mileage and subsequent gas costs, as well as maintenance costs, into consideration when trying to price out your potential car. (Not sure about gas mileage? Check the USDE’s fuel economy finder.) Save yourself both some cash and some regret by thinking realistically about your purchase.
- Get the Best Deal
When it’s tax refund season, some dealers will have promotions and special offers that cater to buyers’ influx of cash. But a good offer up-front doesn’t necessarily mean it’s a good deal. Read the fine print. Take the time to explore all your options by visiting different dealers or buyers and comparing online prices, both key steps when looking to buy either a new or used car.
- Take Your Car Insurance Cost into Account
Researching your car insurance options will allow you to make a more informed decision about the amount of money you can budget for your down payment, so shop around to find cheap car insurance. Think about factors that could increase the price of your insurance like the age of the car, its safety features, and the condition of the car, to help make your auto shopping experience a happy one. Want to know more? Check out our guide to Vehicle Factors That Could Drive Up Insurance Rates.
With these tips handy, you’ll be ready to better budget for your car expenses and get yourself road ready just in time for the spring season.
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Are you spending your tax refund on a car this year? Have any buying tips we missed? Leave us a comment below and let us know!