Using Our Tax Refund on a Car

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If you haven’t noticed from the recent car reviews on the blog, we are in the market for a new ride. The Husband and I have been talking about what our next vehicle will be, and more importantly, we’ve been talking about how we are going to pay for it.

Every bit of our budget has been assigned to something. Food, savings, retirement, our first home; it’s all allotted for. The only time we have income that isn’t placed into an immediate “envelope” is when we receive side gig money or we receive our tax refunds. Most of the time, refunds are used to get us a few months ahead of the bills before summer hits and we’re overrun by road trips, summer activities and the electric bill. But, in all actuality, it’s seen as “extra” money. So, would it be warranted for us to use towards a new (to us) car?

Why I think we can do it
We are in a position where the money can be put towards a safer (and roomier!) vehicle. Savings are set, bills are paid, and our car is on it’s last leg. We have lots of road trips coming up this spring and summer (one i’ll share with you in detail tomorrow) and it’s essential that our car be on its best behavior. As of right now, the amount we would spend fixing up our current vehicle can just be used towards another car.

Why maybe we shouldn’t
While we are getting a good amount in our tax refund, it won’t be so much that we can just get a really great car and pay all cash. Since we need more room, we’ve been looking at newer cars (and new cars) that can provide us with safety, good gas mileage, and longevity. This means that we can put a big down payment on a car but will have a few small payments for about two years. I LOATHE payments. We’ve gone out of our way to be debt free, and doing payments on a car, even small ones, will make me want to Hulk Smash. It’s not like we can’t do it, since we don’t have many bills, but it will irritate me and will push us right back into having some type of debt. Even if it’s temporary, I’ll still have a problem with it.  But…we need a new car!

I’ve always said that we’d use our cars until the wheels fall off and we’ve done a great job of it since the Honda Debacle. One car actually lost a wheel. Seriously. So, is it finally time to get a “grown up” car? Are we finally in the position to have our pick of vehicles and, amazingly enough, pay most of it off right away? I think so. Actually, I know so. Now to find the right car.

About Amiyrah

My name is Amiyrah and I'm an an African American fashion & lifestyle blogger based in Ohio.

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  1. 3.6.13

    I feel the same way you do about not making bills but to get in a car and not worry about getting stuck somewhere with your kids in the car is a wise investment. Plus using your credit maintains and builds on it.

  2. 3.6.13

    What I love is the peace of mind you have with a new car and the mechanical issues are for the most part way off in the future!

  3. 3.6.13

    Lost a wheel? Yikes!

    Being a Dave Ramsey follower, I advocate saving until you can pay cash:) So, maybe you get a no bells and whistles car for a bit longer? I’ve never had a bells and whistles car!

  4. 3.6.13
    Amiyrah said:

    @Krystyn, we’ve never had a “bells and whistles” car either, at least not as a family. We wont be getting one this time either. It’s the whole “needing more room” thing that’s getting us into a higher bracket of cars. So, yup, we’ll have to do some small payments since this car is threatening to give out on us any moment. But, we can handle it! I’m a “Ramsey girl” too…which is why we are debt free 😉

  5. 3.6.13
    Lindsey said:

    Good luck finding a car that you love!

  6. 3.7.13

    Oooo good luck finding your new car! I love car shopping, though most hate it. I love the smart way that you are going about it too.