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Should I Buy Two Cars at Once?

Question: I need to buy two vehicles in the next four months. Would it be better to make these purchases all at once or stagger them? I plan to have one paid off within two years.

– Willie Brown, Manassas, Va.

Answer: Two cars is a good chunk of change. While individual situations always vary, a general conservative rule of thumb is to keep nonmortgage debt (such as car or credit card payments) to no more than 15 percent of your take-home pay, says Robert Swift, CEO of TCI Wealth Advisors in Tucson, Ariz. As for staggering your purchases, experts say there’s not much advantage to that beyond a few months of cash flow relief. In fact, you might be able to negotiate a better price if you buy both vehicles from the same dealer, potentially saving several thousand bucks,
says Swift.

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