Buying Cash vs Vehicle Finance vs Early Pay-Off

Buying Cash vs Vehicle Finance vs Early Pay-Off. Image credit: AdobeStock

Buying Cash vs Vehicle Finance vs Early Pay-Off

Now more than ever, finances have been getting chopped and changed, affecting our day-to-day lives as well as saving habits. So, what can you do if you want to drive off in your new car but feel like the savings journey is taking a while? Let’s look at some ways you can drive off affordably and comfortably.

Buying Cash vs Vehicle Finance vs Early Pay-Off

Buying Cash vs Vehicle Finance vs Early Pay-Off. Image credit: AdobeStock

Being mobile in South Africa is one of the most important things, especially due to the lack of consistency in the public transport sector. Most South African citizens rely on public transport; however, when it comes to moments such as late at night, on public holidays and some occasional protests, it often feels much better getting a car. Owning a car in South Africa can also help owners take advantage of e-hailing business opportunities. You might have been saving up to buy a car for some time now; however, even before this ‘new normal’, we all knew that sometimes saving becomes difficult, especially with unexpected emergencies and changes. This might make you wonder what is better? Saving up to buy cash or using vehicle finance?

Vehicle Finance 

As mentioned earlier, most South Africans rely on public transport. This is because of affordability. Many people can afford to have a certain amount of money set aside every month to help them with transportation on a daily basis, especially those that need to be at work or own businesses that need them to travel constantly. This type of saving or setting money aside inspires a lot of South Africans to buy a car because the monthly repayments often feel like what they are accustomed to. A clear and good credit record is another factor that helps South Africans measure their affordability relating to a vehicle of their choice. You probably know what car you want and where you want to get it, and every day you wonder if you’re getting closer or not, but the need for mobility, unexpected expenses and changes aren’t making it easy. Consider private vehicle finance. This way, you get to pay a fixed amount for a certain period of time, affording you the opportunity to save up should you still want to. Maybe you might need a second car, are saving up to buy a house, or even have a baby on the way and want to be prepared. Taking away the stress of saving for a car might be beneficial. Online vehicle finance applications often take minutes, and there is always the option of checking your affordability status. You can benefit from vehicle finance without having to break your bank with cash payments. 

Go The Extra Mile 

Say you are keen on saving up a bit more or want a car to use for only a period of time while you sort out your finances. You can opt for leasing your motor vehicle, which usually costs less than a loan. It is important to speak to financial advisors and ask your financial service provider which options are better for you so that you can get more out of your car-buying experience without having to fork out large amounts of money. Leasing can help you raise more money and be financially secure until you can buy the car you want and also gives you time to think about whether you want to keep leasing or you want to buy. Speaking of raising more money… 

A Quick Exit Also Helps 

The culture of saving and budgeting is encouraged daily in South Africa for people to sustain their income, save for assets they want, as well as be able to afford things like school or varsity fees. If you find that you have mastered a monthly saving routine while paying for your vehicle finance, you might need to consider paying extra on your monthly instalment to decrease the length of the loan. With early repayments, you stand to have a good credit score, save you some money on your instalment and have you debt-free sooner. 

Conclusion 

Whether you choose to buy your car cash, you’ve saved up for a large deposit, want to lease or are interested in vehicle finance; there is something for everyone. However, always ensure you weigh your options and always use the services of a reputable financial service provider and car dealership to avoid being taken advantage of. Always ensure you are making the best vehicle and vehicle finance choice for you. Your future self will thank you for it.