Driving is so common in society, that we often forget it’s a luxury. It’s incredibly expensive to both drive and own a car. If you took the car out of your lifestyle, you’d probably be quite surprised by how much you had left over at the end of the working year. But it’s not just the bills that come with owning a car. There’s also the issue of legal problems and of course, depreciation. All these factors make owning a car an incredibly expensive choice, and that’s why you want to save as much money as you can. On this post, we’re going to look at the expensive financial issues of driving and how to fix them. So, let’s get started.
Insurance
How much does it cost to insure a car? We did a check and for a fairly standard car you could be looking at somewhere between five and six hundred. But that’s not the end of the story because the younger you are, the more expensive the insurance becomes. If you’re in your early twenties, you could be looking at a cost of closer to eight or nine hundred. You may think that your no claims bonus will protect you and lower the cost a little. But remember, if you’re buying your first car and you’ve been driving someone else’s your no claims doesn’t exist. You can’t use it to get cheaper car insurance. As well as this, that five or six hundred was for basic coverage. For everything that you need including breakdown coverage, you’ll be looking at something close to two thousand. That’s a lot of money and considerably more than you’re probably paying to insure your property. Particularly, if you are currently renting. So how can you cheapen the deal on your car insurance?
The best way is to complete a price check. If you do this, you should be able to find all the companies that are offering insurance and the price they could grant you. Then you can pick out the company offering the best deal. It’s worth pointing out that if you ring the company up they tend to play the cost until it’s at a price you can afford. But it’s still difficult to avoid the fact that insuring your car alone is a massive cost on your income.
Depreciation
It worth thinking for a moment about how much you will spend on a car. For a basic car, you should expect to spend somewhere under ten grand. But that’s a basic car, and most people want a little more style and power. So instead, let’s say that you’ll spend around twenty to thirty thousand. This seems closer to the average of what most people will willingly pay for a vehicle. Although some may spend hundreds of thousands on a new car. Is that the best idea? Probably not because cars have one of the fastest depreciation rates on any item that you might think about purchasing. You could buy a car for six thousand but in a couple of years, it will only be worth four. You will immediately be losing money.
Luckily, there are a few ways you can deal with the issue of car depreciation. The first piece of advice we can give is that you do need to keep your car well looked after. If you conduct a regular, thorough maintenance of your vehicle, you should find the blow of depreciation is lessened. This means that you need to be regularly servicing your car and driving sensibly on the road. We’ll talk more about that a little further down.
You could also consider buying a classic. If you buy a classic car, the vehicle won’t depreciate at all. In this way, the car becomes more of an investment rather than a random purchase. One day you might even consider selling the vehicle and doubling the amount that you spent on it. The only issue with classics is that they cost a lot to buy in the first place. As well as this, classics aren’t supposed to be driven at all if you want them to keep their value.
Another possibility is to buy a car second hand. If you buy a car second hand, you’re not going to be paying a lot for it anyway. Due to this, depreciation shouldn’t bother you too much. In fact, it shouldn’t be an issue at all. The car will depreciate but if you buy second hand you’re probably not going to notice.
Road Costs
Then you need to consider the costs of driving on the road. Perhaps one of the biggest costs of the road is going to be a car accident. You may say that it’s unlikely you’ll ever be in a car accident. But seventy percent of first-time drivers are involved in an accident in their first year on the road. That’s why you can’t be totally sure that it’s not going to happen to you. It might not even be your fault. It could be someone else on the road that causes you to crash. If this happens, you’ll need an auto accident attorney. Although, your insurance might not cover the costs. If this is true, you’ll have to pay to get justice for an accident caused by another driver. There’s no way to avoid this cost except to hope that you’re never involved in an accident on the roads.
There’s also the cost of fuel to consider. Most vehicles these days aim to be energy efficient. But if you’re buying second hand you might want to be careful that you don’t purchase a gas guzzler. You could be paying a lot just trying to get from A to B. A problem with the engine can cause the car to use more fuel. Watch out for this issue and get it checked out immediately to save money.
You see, owning and driving a car is a huge expense. If you’re not facing a massive commute, you could use public transport instead.
