A down payment is a percentage of an asking price you pay upfront toward a purchase. The average car down payment is no less than 5% of the car’s total cost, though it is recommended to put forth as much as you can afford on your budget. Since the down payment will lower how much you need to finance with a loan, saving up money ahead of time is important. 
Assess Monthly Expenses
The first step in saving money for the car payment is an assessment of your current monthly expenses. Major expenses like rent, internet, groceries, and cable should be looked at closely. Browse pricing on alternative internet and cable services, or try to negotiate down the monthly cost with your monthly providers. Look for places in your monthly budget where you can cut back, and put the money saved toward the car down payment.
Refinance or Consolidate Debts
Anyone working on paying back several debts at once, like multiple credit cards, should consider refinancing auto loans or other loans you may have and consolidate your debts. Once debts are consolidated into one monthly payment, or credit cards undergo a balance transfer onto one lower interest credit account, the monthly expense will lower. The money that is freed up in your budget can be put into a savings account for a down payment.
Track Ongoing Expenses
Aside from the expected budget for your household, there are a number of small everyday costs that many people fail monitor. A dozen $20 purchases over the course of the month represents $240 that could have been put toward a down payment. Remember that small purchases add up, and add these purchases in to your monthly budget through mindful expense tracking.
Have a Goal
Determine how much you want to have saved up for a down payment and set a date to reach that goal. Keep in mind that you will need at least 5% of the car’s full purchase price but that 10% or more is highly recommended. You should think about what you will want to spend monthly on car payments and find a car in your price range to use as an indicator of an estimated down payment. This will keep you motivated and working toward a more tangible goal.
The amount you manage to save for a car purchase down payment has a big influence on the car loan you get and how much you inevitably pay for the vehicle. Maintain a detailed budget and make strides toward tempered spending to help you save up for a sizeable down payment.
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