How to Afford a New Truck – Best Ways & How Other People Do It

Updated: | Author: Steve Freling | Affiliate links may be present.

Pickup trucks are everywhere! However, these hard working, plentiful vehicles come with a hefty price tag, especially if you purchase one brand new. How do people afford a new truck? What is the best financing option? Are there other ways to save money on a truck?

New pickup trucks cost around $41,000 on average, but can cost up to $100,000. There are several ways to offset that cost, including financing, private loans, an additional job, leasing, writing it off as a business expense, refinancing your old vehicle, or setting aside money. Alternatively, you can look into a less expensive truck models or a used truck.

How Much Does a New Truck Cost?

According to Kelly Blue Book, the average cost for a 2021 pickup truck across all makes and models was $41,105. This was a 7.2% increase in the average pickup truck price from 2020.

However, you don’t have to look far to find a truck that costs much more than that. The 2022 Ram 1500 TRX costs a whopping $76,780. Generally, the higher the trim package, and the more options you add, the higher the price.

How Can I Afford a New Truck?

Coming up with $50,000 or more for a new truck may seem like a dream. It all comes down to priorities. How badly do you want or need a new truck? Here are some ways to make it happen!

Pay with Cash

Let’s face it – handing over enough cash for a brand new truck, while ideal, is not possible for most people. However, paying for a vehicle with cash will add up to significant savings on interest in the long run.

However, if you happen to come up with extra cash, or receive additional cash as a bonus, windfall, or gift, consider using it on a new vehicle, and avoid a loan with all that added interest.

Even if you can’t come up with the total amount in cash, pay as much cash as you can towards the vehicle’s down payment.

Obtain Vehicle Financing

Many people choose to take out a loan for their new vehicle. Vehicle financing is available through financing companies, banks, credit unions, or through a car dealership.

The length of the average car loan is currently 72 months or six years. However, there are vehicle loans available with 7-10 year terms. The longer the term, the lower the monthly payment. However, you will end up paying more interest in the long run with an extended-term loan.

Avoid paying high amounts of interest, if you can. The best practice is to make as large a down payment as you can afford, then choose the shortest term loan possible, as long as you can still afford the monthly payments.

Avoid loans from car dealerships, unless it is a large dealership with a special low interest deal. Otherwise, car dealership loans usually charge the highest interest rates. Credit Unions usually have the lowest interest rates, and will often have reduced application costs. Shop around for the best interest rates before you secure a loan.

Utilize a Private Loan

If you have a willing friend or a family member with extra cash, you could get a private loan. This will potentially save you money in interest.

Make sure to have a clear agreement with your friend or family member ahead of time and stick to it. A relationship is more valuable than a vehicle.

Make Extra Cash

Pick up a side hustle! After all, not only are you purchasing a new truck, you will also have increased insurance expenses, extra gas to buy, and higher vehicle taxes.

There are a lot of side job opportunities available, especially in the digital age. If you have a specialized skill, like tutoring, computer programming, or writing, pick up a freelance job on a site like UpWork in your spare time. Or, look into opportunities like food or grocery delivery.

Have a garage sale, or sell items online. Most of us have extra stuff around that can be sold for additional cash.

Buy a Used Truck Instead

Trucks have a lower than average depreciation rate, but, the truth is, a new truck will depreciate the minute you drive it off the lot.

The first year is when a brand new truck will depreciate the most. For example, the Ford F-150 will drop in value 25-28% in its first year. After the second year, its value drops b about 7%, then in the third year, it drops by 5%.

Save money by purchasing a 2-3 year old truck instead of a brand new model. Your used truck will cost around 30% less than the amount you’d have to spend to buy a new vehicle.

Buy a Less Expensive Truck

Not all trucks come with the same, large price tag! Look for a highly rated truck that fits your budget. Check out these 2022 truck models with lower than average price tags.

Truck Make and ModelStarting Price
2022 Ford Maverick$21,490
2022 Hyundai Santa Cruz$25,215
2022 Toyota Tacoma$26,000
2022 Ford Ranger$26,580
2022 Chevy Colorado$26,155
2022 GMC Canyon$27,755
2022 Nissan Frontier$29,015
2022 Ram 1500 Classic$30,855

Lease a Truck

Leasing a new truck usually costs less per month than a car payment, and without the cost of a down payment. It’s also simple to return or upgrade the vehicle when the lease is over.

The downside? You do not actually own the vehicle, and will not be able to resell it. Also, if you don’t make the lease payments, the owner can take the truck.

Use It for Business

If you use your vehicle for your work or business, you can declare it as a business expense. This makes the expense tax-deductible. However, this does limit the use of your truck for work only.

Alternatively, if you use your vehicle for work use, mileage reimbursement can help pay for your gasoline, and a portion of your vehicle loan, or other vehicle expenses.

Look for Discounts and Rebates

Incentives, discounts, and rebates are constantly changing. Make sure to check local dealerships, as well as vehicle manufacturers to find the best deals.

Currently, there are several deals in place, according to the U.S. News and World Report. These include lease deals on the 2022 Chevy Colorado, and the closely associated 2022 GMC Canyon. General Motors (GM) has several no-interest financing offers available, as well.

Shop Around

There is no rule that says you have to purchase the first truck you test drive! Look around, visit multiple dealers, and make a careful decision. Check the U.S. News Best Price Program to find the best local vehicle prices.

Put Aside Savings

If you have time to plan ahead, start setting aside cash from each paycheck to go towards the purchase of your new pickup truck. Ask your bank about a money market or other savings account that will earn interest.

Budget how much a new truck will cost, figure out your desired down payment, and your monthly payments, and figure out how much you need to save, then set aside each month. Stick with your budget, and reach your goal.

Sell Another Vehicle

Come up with cash by selling another vehicle. Avoid a trade in, if at all possible. Trading in a used vehicle at a car dealership usually yields the lowest dollar amount in return.

Sell your vehicle privately. There are many online platforms devoted to used vehicle sales, such as Facebook Marketplace, or Craigslist. Place a “For Sale” sign in the car window in order to use your vehicle as on-the-go advertising.

Is a New Truck Worth it?

It’s time for a little self-reflection. Is a new truck worth the added expense? As a rule of thumb, most financial experts say not to spend over 30 percent of your annual income on a vehicle.

Some of the low-interest, long-term loan options that are available may sound really appealing and affordable. Do the math before you sign. Evaluate your income, your budget, and your current expenses.

A new truck will also come with higher monthly insurance payments, increased vehicle taxes, and extra gas prices. Take everything into account before you make a major purchase, like a new pickup truck.

The biggest mistake that vehicle buyers make is rushing into a decision. If you take your time, evaluate the expense, your bank account, and look for deals, you will save yourself a lot of money. You may even reevaluate your financial priorities and decide to skip the new truck for the time being.

Final Thoughts

A new pickup truck is a large expense. Evaluate your needs and your budget before you make this kind of purchase. If you decide a brand new pickup truck is for you, use some of these payment strategies in order to buy your truck without breaking the bank!

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