Why You Should Use Your Tax Refund To Buy A Car

 Size of family Commute to work Whatever new situations the spring season brings, taxes are unavoidable. If you're lucky, it's also the time to get a refund from Uncle Sam. What do you do when your bank account is unexpectedly flooded with dollars? Of course, use your tax refund to purchase something you've been eyeing, such as a new or previously owned car.

Seasonal discounts mean extra money in the buyer's pocket.

In 2022, nearly 60% of Americans expect a tax return, with the average check being around $3,000. Car dealers, aiming to boost sales after a slow start to the year, frequently offer outstanding bargains while refunds are being processed. Smart consumers can increase their savings by participating in schemes such as:

• Matching tax refunds For example, if you put down $2,500, they will match it, thus doubling your money. Call ahead to see whether your local dealerships are taking part.

• Incentives for financing Lower interest rates or more flexible loan terms are examples of this.

• Money back guarantee. Additional refunds may be available to certain buyers, such as military personnel or recent college graduates. It's similar to using a coupon while making a purchase. Minerva Studio/ photo Save money by using your tax refund now.

Whether it's a new addition to the family or more road trips to appreciate our own national parks, a vehicle must keep up with your lifestyle. Using your tax refund to put more money down on a car not only reduces the cost, but it also provides four important benefits:

• A lower-interest loan. Less principal borrowed at the outset means a lower sum to repay over the next few years.

• A higher rate. Because a smaller loan entails less risk for the lender, a lower interest rate can be offered. Over the course of the loan, this translates to a more manageable monthly payment for the buyer.

• Save money on interest. If your credit score is low, you will pay a higher interest rate. Starting with a lesser balance means you'll pay less interest in the long run.

• Take more home with you. If you need to replace the family minivan or upgrade to a hybrid SUV, the extra cash allow you to buy bigger or better while keeping the monthly affordable. What is an appropriate down payment amount?

According to Edmunds, the average down payment on a new automobile is approximately 12%. A normal return puts you more than halfway to a new automobile with a $40,000 sticker price. Adding a trade-in further reduces the ultimate price.

Many privately owned vehicles sell for less than $15,000. Even with a 10.9 percent down payment on a secondhand automobile and a portion set aside for unanticipated repairs, the average tax return is enough to cover the down payment altogether.

Whether it's time to trade in your college beater for a more fuel-efficient vehicle or purchase a safe vehicle for a new teen driver, using your tax refund as a down payment makes cars more accessible. KSL Cars has the finest bargains for your bonus bucks.

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