Many times we have the desire of buying the car of our dreams or simply upgrade the car we are driving now. But in the back of our mind we think, Can I really afford it? will I have a negative impact on my saving plans?
Or what’s the right amount of money for down payment, and consequently what’s the smartest decision on the length of the car loan, and the monthly payments.
Experts recommend that the first issue to consider is how much of your financial resources at this point of your life you are willing to devote to upgrading your ride opposed to providing yourself a bigger margin of financial security. The second issue is how you should pay for a new car whatever the car you might want.
In deciding how much you would devote to buy a car, it is recommended that you check what percentage of your yearly salary your car payments would represent. If such percentage gets close or higher to 10% you are probably paying too much, despite the down payment you gave away.
So at the very least you should ask yourself how taking on this new commitment on will affect your ability to save for retirement. Will you be able to pay off the car loan while maintaining your current savings rate? Or will you have to cut back?
In other words, in order to make a wiser decision, you should keep in mind that the fact remains that you’re diverting resources that could go toward enhancing your financial security into a car. So making the right decision now, will require from you to think about the future and your personal financial goals.
Money is anything that is used by an economy to purchase goods and services. The fact that currency is issued by the government does not necessarily make it money.
For example, the 100 dollar bill is issued by the US government, but how many people in the united states actually pay for things with $100 cash? Answer: not that many. So the bill is currency, but it is hinging on the edge of not being a form of money.
Here are some interesting forms of money from all around the world:
Forms of money
1. miniaturized tools
2. miniaturized swords
3. cowry shells
4. slabs of salt
5. beaded belts (wampum)
6. giant stone wheels
7. tobacco
8. electronic transactions
As illustrated in the list above, things such as tobacco and cowry shells (which are not issued specifically as a form of government currency) are used as money in some places. They are simply used to purchase goods and services.
Are taxes emptying your pockets?
Tax day is coming up quick, and the rush to get ready is beginning. Everyone knows taxes can be very confusing to the average person – that’s why accountants get paid so much. But there are some common misconceptions about taxes that could make a difference to you and your finances. One of the biggest ones is tax brackets.
If you asked a random person out on the street what tax brackets are, they would probably say that the higher your income, the higher the percentage you have to pay in taxes. That is partially true. But because of this not-quite-accurate definition, many people misunderstand and say something like “I don’t want to have a higher income, because then I would be in a higher tax bracket.” In fact, that is an awful strategy.
The way the brackets work is a little more complicated, but overall it costs less money than the previous definition would lead you to believe.
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Many times we have the desire of buying the car of our dreams or simply upgrade the car we are driving now. But in the back of our mind we think, Can I really afford it? will I have a negative impact on my saving plans?