Car Shopping: car shop on a rainy day, at the end of the month or toward the end of the year because car dealers will be begging for business mostly during those times; know your credit score ahead of time and secure your financing so you can ask your dealer to give you the best price since you’re financially secure; use the internet to get the best auto deal and to find out the best value for your trade-in; look for rebates and regional incentives; let car dealers know you’re dealing with multiple dealers so each one will give you the lowest price; negotiate the price of the new car, price of trade-in and financing separately so your dealer does not roll it all into one; be prepared to walk away from a deal.

Car Insurance: comparison shop for insurance at least once a year; you can save money on insurance by improving your credit, getting married; moving to a better neighborhood and taking a defensive driving course; keep your driving record clean; bundle your insurance coverage to get a break if you own more than one car; don’t buy more insurance than you need; consider raising deductibles and bank money for emergencies and also increase your liability coverage; consider dropping collision insurance if you drive an older car.

Examples of good debt include buying a home, paying for college and financing a car.  In Buying a Home, it might seem logical to use every dime to cut your interest costs, however it’s not always the best move.  You need to save money for cash reserves.  Mortgages tend to have lower interest rates than other debt and you can deduct the interest on the 1^st million on your tax return.  In Paying for College, it makes more sense to take loans as opposed to borrowing against your retirement funds and your home.  Kids have plenty of resources to draw funds such as Perkins or Stafford loans.  Those loans are guaranteed low rates, no interest due until after graduation and interest paid is tax deductible in some cases.  In Financing a Car, you first need to figure out if you want to keep it until it dies.  It also depends on your cash available.  If you pay for the car in full, it would make sense to keep the car until it no longer works.  Most people can’t afford to pay 100%, so the goal is to put down as much as you can without depleting your cash reserve.  A loan makes sense if you plan on driving it long after your payments have stopped.  You might be tempted to use a home equity loan because of a lower interest rate, and tax deductible interest.  However, be careful.  You need to make sure you can afford the payments because if you default you could lose your home.  Leasing a car might be the route for you if you plan to change vehicles every 3 or 4 years, you want to avoid a down payment of 10% to 20%, you don’t drive more than 15,000 miles a year and you keep your vehicle in good condition.  Shop for the best deal since dealers usually look for the highest interest rates possible.

Borrowing for other expenses like a home equity loan or line of credit is smart in some cases.  Besides paying for a home, car and college, you might be tempted to borrow money for furniture, appliances and home remodeling.  It’s best to pay up front for furniture and appliances since they don’t add value to your home.  If you finance the purchases from the store, you could end up paying a lot more in interest and finance charges. Taking a home equity loan or line of credit will then make sense if you’re making home improvements.  The interest you pay in many cases will be deductible and you increase your equity.  If, a home project does not boost your value, then consider paying cash or taking a short-term, low-interest loan to be paid in five years or less.  There are two primary advantages to home equity loans: (1) they typically charge a lot less in interest and (2) the interest you pay in most cases is deductible (up to the first $100,000 of the loan).  However, if you borrow against your home to pay off credit cards, you may lose your home if you default in payments. 

Now that your kids are probably out of school, it may be a great time to teach them about spending and saving their money.  Most kids today receive allowances.  Depending on the state they’re in, they are eligible to open up their own checking/savings account with a bank.  Checking accounts will help teach them to write checks and pay for their purchases by knowing their balances beforehand.  Savings will teach them long term goals for when they leave the nest.  Discuss with them the difference between wants and needs.  Teach them while their young and you will pave a path for their successful financial future. 

As of now the Georgia legislature has not passed a bill to allow a sales tax week for school supplies. Therefore it would be in your best interest, if you have a child in school, or if you are going to college to try and cut back a bit.  Maybe you can look for sales at local stores or even at discount stores such as Walmart or Target. There are also online sales you should take advantage of with lower prices and free shipping.  Now would be a great time for everyone, especially if you are on a budget, to start searching for those sales. Das-Brooks wishes everyone a Happy school year.

Now that you’ll have more expenses with having children in school, it may be a financially smart idea to consider buying generic products such as Fruits, Vegetables, Breakfast Items, Baking Products, over the counter Drugs and Prescription Drugs.  Generic items have to pass the same standards as other “famous name brand” items.  If they all need to deliver the same quality, there is no harm in purchasing generic items.  Families can save about $1500 per year on groceries if they purchase generic brands.  You can use that money you’ve saved towards a college fund.