Buying a Car on a Budget: How to Stay Within your Means

It’s one thing to set a budget, it’s another to stick to it. Usually when you set a budget it’s not just because you want to save the money, but because you need to, that’s why it’s so important to make sure that you actually stick to a budget when you set one, and that’s what this article is for, we’re going to go through some of the best tips for successfully buying a car on a budget in Canada.

Don’t Rely on Willpower

Sticking to a budget is a lot like maintaining a diet, or an exercise routine, in that willpower is only half the battle. Yes you do need to keep yourself in line to some extent, force yourself not to go over budget no matter what, but just like a diet the true secret is to remove the things that will tempt you to go over budget. Having someone else in the process with you can be a massive help here, someone with less involvement who can keep you straight if you seem to be going over budget. 

Factor Every Cost

An important fact to remember, and one that can be a nasty surprise if you don’t is that there are costs beyond the initial price of the car. When you’re trying to stick to a budget it’s very important that you include all the extra costs like Taxes, the cost of additional extras, and administration fees when you’re creating and sticking to your budget.

Depending on how you’re budgeting there are long term costs you’ll need to consider as well. The amount of your monthly loan payments, and especially the interest rate are important to figure out, as well as the cost of insurance and potential fuel costs depending on the car’s efficiency. 

Define Your Wants vs Needs

The thing that’s most likely to trip you when buying a car on a budget in Ontario is adding things to the car that you want, but don’t actually need, which is why you need to make the distinction super clear, ideally in writing. 


Establish one column which is needs and one column which is wants. There’s no strict rules here since your wants and needs will be different from someone else depending on your situation. For example if you’re going to be using the car as part of a delivery job then fuel efficiency is a need, and storage space is a need, where for a less used personal car those may just be wants. Once you have it, stick to it, if you can afford the needs then by all means include them but make sure you understand what they are. 

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