A lot of people underestimate the costs associated with car ownership. Most people think that once they buy a car, they have nothing else to pay for besides fuel, but this is not true. Not only do car owners have to pay for services and emergency repairs, but they also have to buy things like screenwash and oil.
If you are planning on buying your first car, learning about the financial side of car ownership will save you a lot of hassle (and potentially a lot of money). This post explores this topic in more detail and explains everything you need to know.
Initial Purchase Price
The first thing you need to consider if you plan on buying a car is the initial purchase price. One of the leading Ford dealers in Brisbane makes clear on their site that finance is an option, so if you are struggling to come up with the cash, you can always use credit. Car finance allows you to spread the cost of a car purchase into more affordable monthly installments.
If you are not interested in using credit to buy a car, an alternative is to pay cash but buy a used one. Used vehicles have a lot of benefits, but they always come with some wear and tear. If you want a car that is untouched, you have no choice but to buy one new, with cash or using finance.
Insurance Costs
The next consideration you need to make is insurance costs. If you are a new driver, your insurance premiums will be a lot higher than somebody who has been on the road for a while. Rising insurance costs have made car ownership unaffordable for a lot of young people, so definitely research the make and model of car you plan on buying, and get a quote on it.
As well as getting quotes, be sure to use comparison sites. Comparison sites make it possible for you to find the best insurance package possible, which they do by comparing the prices offered by different insurers, as well as the advantages and disadvantages of working with specific providers.
Fuel Costs
Fuel costs are ignored by a lot of new drivers. If you are buying a new car, you need to think about fuel efficiency. Try and find a vehicle you can actually afford to run. The last thing you want is to buy a vehicle at the top end of your budget, and then for you to be unable to put fuel in it because it costs too much to fill up. Large diesel trucks, for example, are not ideal for people whose budgets do not go very far, as diesel invariably always costs more than petrol. Diesel engines burn a lot of fuel too, which means that if you do not have a lot of money but use your car a lot, you will constantly be running out of fuel.
There are free apps and websites you can use that can help you with estimating fuel costs. If you plan on using one, make sure you take into consideration the fact that fuel costs fluctuate according to the time of year, availability, and even the area you are in. Also, remember that different fuel types have different costs, so you need to make sure the calculator you are using is using the correct fuel type. To find out what type of fuel the car you want to buy uses, get in touch with an approved dealer and ask.
Service Costs
Service costs are worth thinking about, too. Every year, you need to service your car, so it can be deemed roadworthy. If you do not get your car serviced, you may not be able to drive it. The laws regarding services vary from country to country, however. The reason cars have to be serviced is so the government can satisfy themselves that they are safe and do not pose a threat to other road users.
Services do not tend to cost a lot of money, but if necessary repairs are identified, you will have to pay to have them made, which means you could end up paying a lot of money toward services. Make sure you find a reliable mechanic who’s experienced in working with the particular make or model of the car you own, so you don’t have to worry about them making mistakes or causing further damage when performing inspections or repairs.
Maintenance and Repairs
Maintenance and repairs are also a considerations you need to make. The cost of repairing a car depends largely upon the damage sustained, and whether or not you want repairs made by a professional mechanic who specializes in working on cars made by the same manufacturer as yours, or if you want to take your car to a general mechanic. The problem with general mechanics is that they sometimes don’t have the expertise needed to work on cars with very complicated engines, which means they often make mistakes and cause more damage (or new problems).
If you are on a budget, you will be pleased to know that many mechanics actually offer flexible payment options nowadays. This means you can spread the cost of your repairs over several months, and repay in installments. Installment plans are ideal for people who have small budgets.
Making Modifications
A lot of car owners enjoy making modifications to their vehicles. Modifying your car can be an effective way to improve its appearance and even increase its value. If you plan on modifying the vehicle you intend on buying, research costs associated with modifications and upgrades first.
Researching costs will help prevent you from committing to modifications you cannot afford. Remember that for engine modifications, it is best to hire a professional to perform upgrades for you. The chances of you being able to effectively modify your car’s engine yourself, especially if you aren’t a mechanic, are slim.
The financial side of car ownership is something a lot of people overlook or underestimate. If you are planning on buying a car, think about the things mentioned here. Doing so will help you avoid buying a vehicle you cannot afford to run, and give you a better understanding of the costs you are going to incur.
