The car is often the second biggest cost after the home. Unfortunately, the car is a real money pit. The Five Ways to Save tips to help drive your dollars further are
1. Buy what you need, not what you want
Cars have a high emotional and a strong status symbol attachment which makes them a real sucker for your hard earned savings. When planning to buy a new motor vehicle, consider what you really need and not get tempted by the flash advertising or trying to be one up on your neighbour. When you know what you need, set about seeking the best deal.
Remember the problem of depreciation. A car will generally lose half its value after three years. Therefore the more expensive the car is, the more you are likely to lose even when it is parked up going nowhere.
2. Avoid finance costs if you can
If you can, buy with cash. This means you are spending what you can afford and you’ll avoid high interest costs on the finance. Insurance will be easier and you can always haggle for a better deal by being in a position to drive away the car.
If you must finance the car, consider all options. Can you sell down investments like shares and use that cash to help support the deal. Can you get a simple loan from the bank that will give you more flexibility than a finance deal at the car yard? Will work help you via a leasing arrangement?
3. Keep it serviced and at the same workshop
Cars have a habit of breaking down and when they do they cost a minor fortune to fix them up. A regular service will minimise the chance of an unexpected break down and it may also save you money in the event of a police check who could fine you for that bald tyre or non working brake light.
Having it serviced by the same workshop will allow the mechanics to really know your car and will help with the resale value whereby the future buyer can see all the services have been documented.
4. Drive safely and be vigilant
There are so many safety cameras (speed and red light cameras); it’s very easy to get caught out. The fines are bad enough but losing your licence can take the costs to a whole new level as it could mean the loss of work and future opportunities.
Driving safely also has other benefits; a smooth driver will have far less wear and tear and better fuel economy than an erratic driver who can normally be spotted as always the first one away at the lights.
5. Do you really need a car?
Many city dwellers these days rarely take the car out except for weekends. Have a good long hard look at the need for a car as opposed to alternatives. These days, you can catch a cab easily and quickly for those short trips. The cost to hire a car is also very cheap especially on weekends. When you consider the financing cost, fuel, servicing, insurances and the biggie deprecation; cabs and hiring a car for the weekend could be much more flexible and help you save some more cash.