We all seek to avoid painful mistakes in life.  Mistakes can be avoided by obtaining knowledge and applying it in the form of wisdom.

Unfortunately, we often gain knowledge and wisdom only by making the mistakes that we are trying to avoid. We’ve all thought, or even said aloud, after one of these painful experiences, “I wish I could go back and do that over again.”

 Hopefully by understanding a few things, you can make some well informed decisions.  Here are some bullet points to remember when planning to purchase a vehicle, or any purchase where taking out a loan is necessary.
 

1.  We tend to buy on emotion which is unavoidable.  However, if we think through things ahead of time and remember what our real goals and dreams are, it will minimize the mistakes made by letting our emotions run our lives.
2. Getting sound advice is tricky.  Try to get it from someone who has been successful in areas of life you would like to be successful in, not from a peer who is in the same boat you are.
3. Be careful of the trap of “monthly payment” affordability.  When buying a large ticket item, remember that you are borrowing money to make the purchase, not really making payments like you might on a rental car.  In a rental agreement, when you bring the car back to its rightful owner that you rented it from, your payments stop.  When purchasing a vehicle, YOU are the rightful owner of the vehicle and have borrowed money from someone to buy that vehicle.  If you fail to be able to make your payments when you promise, it could ruin your ability to borrow money in the future.  It can also affect things like your insurance rates, credit cards, interest rates, and a myriad of other impacts from one decision.  Be careful with your credit.  It is one of the most valuable things you can build.

         If the price of something is $15,000 and you don’t have the $15,000 saved up for the item, you must borrow part of that money from a business that lends money and pay it back over time with interest.  The interest “rate” is the percentage the lender charges at a yearly figure for you to borrow that money from them.

            The “down payment” is the amount you saved up toward purchasing the item and is the amount you will pay toward the item, and then borrow the rest.  For instance if you saved up $4,500 then you would ask a lender to borrow $10,500 and you use the value of the item, called collateral, to guarantee you will make the payments back to the lender.  The $4500 is paid to the seller as well as the $10,500 you borrowed to purchase the item.  Also, remember there are taxes and fees added to the purchase price of the item.  Check out how much the fees are, and what they are for before purchasing the item.
 

4. When you borrow money for a vehicle, the lender will use the vehicle to guarantee repayment of the loan.  If you don’t make payments on time, the lender may choose to seize the item, sell it to recoup what you still owe them, and if there is any more owed after they sell it, then they will take you to court to get the rest of the money.  This is different from a credit card that is not guaranteed, and the reason is that the interest rate is much lower is because the risk is less for the lender knowing they have collateral to get their money out of.
5. Making sure you can afford the monthly payment to the bank, the insurance, and the property tax are all important planning measures to take before going to purchase a vehicle.  We all want the nicest, shiniest, newest, best-looking vehicle we can get.  But good features come with a price.  Make sure the price is worth it to you to pay. 
6. Paying extra toward your loan and paying it off early not only saves you money on interest but can also build your credit rating even faster.  It’s always a good idea to get rid of debt sooner than later.
7. Borrowing money is part of living in this economy and living in the world today.  Making sure we use debt wisely can make the difference between having a bright and wealthy future and being poor and struggling the rest of our lives. 
8. If you want more information on debt and how to become financially free, we would love to share more insights in person.  Contact us here at Freedom Auto Sales to set up an appointment with the owner.

 

 

ADVICE

October 1, 2024

...do WE listen to wise counsel or just run off our own limited understanding and experience. Second, do we get counsel from wise people? And how do we know if they are wise...

The importance of advice.
Good advice is VERY rare in today’s world. Everyone seems to be wanting to sell you something, convince you that their way is right, and some just plain ding-dong ideas are being promoted in society as “mainstream”. In a time where wisdom and sound advice is needed more than ever, it seems to be rare and elusive.
There are sources of foundational wisdom we can turn to in times of difficulty and confusion. One main place is the Bible. God’s one book He gave us as an instruction manual. If the Creator of the universe gives us a book, He probably expects us to read it and live by it. In my years here on planet earth, it has been my experience that when I live by the Bible’s direction and instruction, things go way better than when I do things contrary to God’s design.
So how does this relate to the car industry? We all should get advice on buying a car. After all, it is the second biggest purchase of a person’s life! We SHOULD want wisdom outside of our own understanding. The problem is, most people are eager to give their opinions on EVERYTHING! We should be very careful about whose opinions we give credence to. Proverbs 12:15 says “ The way of a fool is right in his own eyes, but a wise man listens to counsel.”
There are two lessons here. One is, do WE listen to wise counsel or just run off our own limited understanding and experience. Second, do we get counsel from wise people? And how do we know if they are wise? Do THEY listen to wise people? Do they have “fruit on the tree”. Do they live well, and have results that you would like to have? Do they have more years of experience than you?. The bible further says, the beginning of wisdom is the fear of the LORD. (PR 9:10) Are they a person who follows after God’s design?
We basically have the following choices:

• We can choose to follow our own limited knowledge
• We can listen to our friends who may be great friends and have a lot of fun but may or may not have wisdom in the particular area we need advice in.
• We can listen to someone, or several different people, with experience who tend to make wise choices and get their input.
• Once we have gathered all the input, we ultimately have to decide for ourselves what is wise. Of course we would recommend prayerful consideration as God leads you in your decision making process. He designed you and knows best your specific needs.

We pray God’s best for your lives and hope to meet you soon. Stop by any time to visit and let us get to know you better.
Until then, enjoy the great political and economic Freedom we have been granted in this country, and the spiritual Freedom through Jesus!