one of the biggest ways I've found: dont buy new cars. As I've heard one financial expert say: "the pair of shoes you wear has more of an impact on your life than the car you drive"
Believe me, I've crunched the numbers. Driving a new car (even a relatively "cheap" car that costs $25k) will cost you about 2-3x more per year to drive than a cheap used car that you can pay in full. When you add in the extra insurance costs, interest, mandatory maintenance schedule to keep the warranty in tact, it really adds up and makes you checkbook take a big hit. Used cars (look for reputable models, hondas, toyotas that are in good shape ) can save you thousands a year in your budget.
Believe me, I've crunched the numbers. Driving a new car (even a relatively "cheap" car that costs $25k) will cost you about 2-3x more per year to drive than a cheap used car that you can pay in full. When you add in the extra insurance costs, interest, mandatory maintenance schedule to keep the warranty in tact, it really adds up and makes you checkbook take a big hit. Used cars (look for reputable models, hondas, toyotas that are in good shape ) can save you thousands a year in your budget.
That concept of buying something cheaper and likely lower quality can be applied to any product or service; not just cars. The issue is the experience or standard of living obviously drops when you spend less.
The other part about the car is that you have an asset worth a certain amount. When you go to sell that 25k car, after a few years, it will have a higher value than a car that was already old and cheap in the first place.
