Is Your Car Driving You to the Poorhouse?

Is your car driving you to the poor house?

The typical cost of owning a car is over $760 a month. That’s more than $9,000 a year going towards payments, insurance, taxes, repairs, and gasoline. A MarketWatch Guides Survey reveals some painful statistics. Nearly two in five can’t afford necessary repairs and upgrades for their car. Close to half can’t save or invest due to car-related costs, and a fourth of the people admited to owning a car outside of their budget.

The car you drive may be making you poor if you’re spending more than you can really afford. So let me ask you: Are you able to give, save, and invest or are you living paycheck to paycheck? Most financial experts suggest that car payments never exceed 10% of your take-home pay. Total car expenses should not exceed 20%. Buying and driving good used cars has many financial benefits. Depreciation results in a much lower purchase price. Insurance costs less and maintenance and repairs are often less as well. If you’re unable to achieve short or long-range financial goals take a serious look at what you’re spending to own a car. I recommend that you direct automatic payments into a savings account until you accumulate enough cash to make a purchase without borrowing. It’s better to drive a dependable old car than to worry about making payments on a new one. Remember the Proverb “..the borrower is slave to the lender.” (Proverbs 22:7)

And if car payments have you in a bind, check out our budget coaching program. This Scripture-based training can put you on the road to financial freedom. Go to crown.org and click the “Get Help Now” tab. You can start today at crown.org.