By Lynnette Khalfani-Cox, The Money Coach®
Having a car these days isn’t cheap. In fact, Kelley Blue Book reported that the estimated average price for new, light vehicles in the U.S. was $35,511 in June 2018.
The cost of acquiring and financing a vehicle is one thing. On top of that, there are many other operational and ongoing vehicle expenses you’ll need to cover as a car owner.
Read this related article: How Much Car Can You Afford?
So what can you do to lower the cost of car ownership? Her are a few ideas:
Buy used instead of new
In our family, we believe in driving cars for as long as possible. That’s why my husband, Earl, still drives his 2003 Chevy Tahoe. It has about 140,000 miles on it and runs great. Way back in 2002, I bought a brand new Toyota Highlander. I drove it for just over 15 years until it finally gave out in December 2017. To replace it, in the Spring of 2018, we bought a used BMW 750i. It might sound fancy, and I suppose it is. What really sealed the deal for us, though, was the price: We got the car for a bargain basement cost of $15,000, because the car is a 2012 model and we purchased it from my sister, who no longer needed the vehicle.
Too many people shy away from getting used cars; but good ones are worth a look because of the money you can save. Even buying a car that’s one to three years old will save you big bucks because a vehicle depreciates as soon as a buyer drives it off the dealer’s lot.
Besides, even a used car would be “new” to you.
Shop around for car insurance
One considerable cost of car ownership is paying to insure the vehicle of your choice. Don’t just accept the first car insurance quote you receive. Shop around to be sure you’re getting the best rates available in the marketplace because pricing can vary wildly. Getting at least three auto insurance quotes is especially important for residents of the Golden State, since car insurance rates average nearly $2,000 annually in California, and California is among the top 10 most expensive states for auto insurance, according to a 2018 study from Value Penguin.
Practice preventive maintenance
You can help avoid costly breakdowns and sky-high auto repair bills simply by keeping your vehicle in good working order. This means getting regularly scheduled oil changes, and maintenances checks to inspect things like your tires, belts, battery or engine. Don’t make the mistake I made once, when in college, I ran a used car I had (a Volkswagen Rabbit) into the ground. I took that poor vehicle up and down the 405 Freeway between Irvine and Los Angeles so many times I can’t remember, often without ever changing the oil. What I do recall, however, is one day the engine seized up as I was returning to UC Irvine from L.A., and I was left unceremoniously on the side of the highway. That was the official end of that car – all because I’d neglected basic car maintenance.
Consider money-saving alternatives
Lastly, you can lower the cost of car ownership by swapping out your auto use from time to time or when it’s appropriate for your circumstances. For example, when fuel prices get out of control, and put a crimp in your budget, consider taking public transportation or carpooling to work. You might also look into the economics of using car-sharing services or even consider riding a bicycle, instead of driving your car, if that’s feasible. By cutting back on using your own car you don’t have to fight traffic or pay for gas, reducing two big headaches while saving you money in the process.
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