Graduates and Car Loans

Many graduates, high school and college, have a tendency to take on something called credit now that they have graduated. Sometimes it is just a credit card, but many times it is a new car. Often a high school senior will think that they need a new car for college, something that will get them back and forth, and give them a bit of a status bump at their new school. Other times it is a college graduate who takes on the car loan in anticipation of the job market ahead. Either way, it is important to think before you act.

Car loans are one of those things that will stick with you for usually about five years. So if you are a high school graduate, know that depending on the car you get, and how much you decide to spend, you could still be paying on that car when you graduate college. If you can avoid buying a car, and using public transportation to get back and forth, then by all means do so. You really don’t want to be in college worrying about your car loan payments.

Same goes for college graduates, whether getting a new car in anticipation of the new job or to replace the old one, you should wait until you have that dream job in your hand and not count on one falling into your lap just because you have graduated. Wait to see what the world offers you first, because you might end up in a job that is not paying what you anticipated and now you are wondering what to do with the new car loan you have.

In either case, if you can get away without taking on a car loan, by all means do so. However, if you have to get a car, take on the cheapest one you can, and make sure it is in good condition so you aren’t looking at expensive repair bills. You should also look into good gas mileage, because paying on the auto loan and the gas pump at the same time can get expensive.

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