How to Buy a Vehicle with Cash

Photo from here.

Paying for a car without borrowing is smart. In addition to the general blessings of avoiding debt, paying cash for a car will give you negotiating power and help you make a wise decision.

For example, if you've worked hard for five years to save $20,000, it will probably be hard to spend it all on a new car that will probably be worth less than $10,000 in value in another five years. Instead, you'll likely look to buy a decent used car for a fraction of the price. However, if you use a loan to purchase a car, even if you have very little saved up, you'll have less incentive to be conservative in your purchase because the cost will not be felt right away.

But, you may wonder, will a commitment to buying a car for cash mean limiting yourself to a ride like:

Picture from here.

No, it's very doable. Here are some specific strategies:

Strategy #1: Buy a used vehicle.

By buying a used vehicle, it's possible to pay a very low price. I personally have bought two cars, one for $2,700 and one for $2,000. Family members have also bought used cars, usually from 2-4K.

Here are a few recommendations for used car shopping:

1. Pray. God is sovereign. Ask for His blessing.
2. Persevere. After deciding what types of vehicles to look for and setting a budget, it took multiple days of constantly checking Facebook Marketplace and Craigslist (and other sites) before I found my cars. I traveled over two hours to look at a car I didn't buy and made another 1.5 hr trip for the car I did buy. It was hard, but sticking to my budget was worth it.
3. Avoid fees, if possible. In Alabama, if you buy in-state from a dealer, there's a lot of fees ($300-500 for cars around $2-3K) but these can be avoided by buying from a person or from out-of-state.
4. To avoid scams: Ask if the seller has the title on hand. Ask how they got the car and for details about it (any problems, mileage, service history, price, etc). Ask for close-up pictures of any damage. If the seller won't go into detail or sounds sketchy, it's probably a scam.
5. Move fast. After weeding through hundreds of listings and seeing the one for my first car, I called right away and asked to see it in a few hours. It turns out that the seller had three other people who wanted to check out the car if I hadn't bought it.
6. Have a checklist ready for when you look at a vehicle. Ask a mechanic about any issues you notice before purchasing a car; it's usually best not to buy a car with problems.

Is "car payments or car repairs" a true dilemma? Although older cars do have a tendency to need more work than newer cars, I think in many cases, it's a false dilemma. Sometimes my family's cars have needed bigger repairs (once a motor needed replacing) and sometimes it's no longer worth it to keep a car that keeps breaking down, but in general, my family's cars just need the typical oil changes, brakes, and tires. Repair costs on average have been much less than payments for new cars would have been. If you know an honest mechanic (and/or can do some repairs yourself), it helps.

Strategy #2:Wait to buy a vehicle.

I personally waited until I was twenty-two years old before buying a car. For years I used one of my parent's cars.

Waiting enables saving. Even if you have no money to start with, if you can save $40/week for one year, you'll have $2,000. If you can wait longer to purchase a car, you can either increase your budget or decrease the amount you'll need to save if things are tight.

Strategy #3: Choose a vehicle economically.

A vehicle is for moving you + other people (if needed) + items (if needed) from point A to point B. It's not wrong to buy a new or expensive type of vehicle but don't do so out of a desire to appear in a certain social status.

I choose to purchase a minivan because I needed the space to transport building materials (the seats can be removed) and because trucks and SUV's (which I initially thought I might want) were generally priced above my budget and didn't achieve very good gas mileage.

In addition to thinking about what type of vehicle you truly need, the cost to insure it is also something to think about.

Strategy #4: Get help, give help.

When my parents allowed me to use their cars, it was helpful. I've been able to do some car repairs for them, which has helped them. Once, when a car motor had broken, a friend paid for a portion of the repair, which was a tremendous blessing (and answer to prayer) to my family during a tough time.

If you need help, ask. If you know someone who needs help, be generous. Christians should be characterized by giving of themselves. You and all you possess belong to God.

The generous soul will be made rich, And he who waters will also be watered himself.(Proverbs 11:25)