Many South Africans live in debt and very few have the financial ability to pay cash for big ticket items such as cars. As a result, many people resort to taking car loans in order to finance their vehicles.
In itself, a loan is not necessarily a bad thing and does not need to affect your life negatively. Best of all, it is possible to pay off a car loan quicker than you might think, when you consider the following guidelines:
Pay More Whenever Your Finances Allow
It is advisable to pay more towards your car loan whenever you have extra disposable income which could come from bonuses, tax refunds or profit from the sale of personal goods. Paying extra will help to decrease your car loan term and interest rates.
Round Up Your Repayment Amount
Believe it or not, repayments are often not rounded up, which gives you the opportunity to round up the amount. For instance, if your monthly instalment is R9789, pay back R10 000 instead. The extra amount will make go towards making a huge difference in the long term.
Paying off your car loan is doable, especially when you become disciplined and follow through on informed decisions about your finances.