Millennials are understandably wary of their financial spending. However, this generation is finally coming into its own as the world’s most influential spending demographic.
If you count yourself among the ranks of Generation Y, then you’ve probably had to face several significant life decisions. From your career goals to affordable housing or rent, to matters of credit and loan payments, dealing with these issues can seem a lot more difficult and complicated than the advice given by older generations made it out to be.
Making a car purchase is no different. For many people, buying a car might be the second biggest purchase of their lives, next to buying a home. So before checking out your local dealership or comparing the pros and cons of Audi or other models, how do you know if the time is right? Here are some points to consider:
Lifestyle
Even if not all millennials are consciously thinking of the big picture at all times, our big decisions are often shaped by the practicalities of everyday living. Location is a significant consideration here. Do you live in a big city with access to convenient public transportation? How much time do you figure to spend on the road going about your regular activities, versus commuting or using ride-sharing services?
Your family arrangements also come into play here. Are you settled in the suburbs with your partner or kids? If so, you might find it easier to get around and drop everybody off at various destinations instead of relying on bus stops once or twice an hour and walking or biking the rest of the way. But if you’re single, you might find that commuting is a better fit for your lifestyle.
Purpose
Not everybody buys a car for purely functional reasons. You might have your particular motives for being interested in getting your vehicle, going well beyond basic convenience or being able to provide the occasional helpful lift for friends and family.
Do you enjoy going on long road trips to visit obscure attractions? Perhaps you want to indulge in offroading with custom-built SUVs. And of course, for many people, the status boost of owning a car is a signal of financial independence.
Be honest about why you’re taking this step. Any decision you make on your first car purchase will need to be evaluated carefully in the light of your primary reasons for doing so.
Finances
The popular image of millennials as carefree, ill-advised spenders who tend to purchase experiences and other ephemera, rather than tangible investments, is probably a misconception. Most young professionals from this generation are hardworking and prudent individuals who have learned to be very cautious with their money. You’ve probably done the math a few times, and you know how much you can afford to spend on an automobile at this point.
When you choose between models and financing options, remember that future expenses can change. For example, you might be decidedly single, renting in the city, and independent at this time. But later on, you might reconsider settling down, having a family, and owning property. Even if you’ve been planning for everything, including retirement and emergencies, prospects can change, and the value of assets can fluctuate in uncertain times.
With thoughtful preparation and careful evaluation, buying a car is a significant step toward getting where you want to go every day.
