There’s more to consider when buying a car than deciding on whether you want the upgraded sound system. Remember that your monthly payment will comprise more than just your car note. AAA reports that drivers can expect to spend about $750 a year on average for repairs and another $1,200 or so on insurance. And then there’s filling the tank, an occasional trip through the car wash and purchasing a pair of fuzzy dice. But with prudent planning, you can still own a car without breaking your budget.
Keep up With Routine Maintenance. Even if you have a brand-new car with a full warranty, you’ll still have regular maintenance expenses like oil changes, air filter replacements and tire rotations. So, set aside money in your monthly budget to keep up with these routine costs. Skipping or delaying service can lead to more expensive repairs down the road. And especially if you have an older car, a membership with AAA or other roadside assistance program can avert a pricey tow should you break down far from home.
Curb Insurance Costs. Remember your high school driving class? Those lessons are just as relevant now. Don’t have a lead foot on the road. Don’t drive under the influence of alcohol or drugs (legal or otherwise). Tickets can have lasting effects on your pocketbook. In some states, insurance rates can rise by as much as 30% after you get a ticket — and premium increases can last for years.
Luxury or high-end vehicles can also jack up the price of insurance because of the typically higher repair costs for these cars. So buying a more moderately priced vehicle can help reduce your insurance bill as well as your loan payments. And there are other steps you can take to reduce the risk of a claim. Leaving a car parked in a driveway most of the time, instead of garaging it, can increase the risk of theft. This matters because even if you’re well-insured, you’ll be required to pay a deductible.
Save on Gas. Use a mobile app to find the best price for gasoline in your area. And plan your errands to avoid zig-zagging all over town. Keeping tires properly inflated and not carrying excess cargo in your trunk can help maintain fuel efficiency — as does avoiding “riding the brakes” excessively. And don’t forget carpooling as a great strategy to save on gas and mileage.
Don’t Let Your Car Take You on a Financial Detour. The emotional benefits of owning a car you love can be as impactful as the practical ones, but don’t let an impulsive purchase derail you from your future financial priorities. An expensive car payment, high insurance rates, costly repairs and poor fuel efficiency can put the brakes on long-term goals like saving for a new home or investing for your dream retirement. Contact your WellCents financial professional for help analyzing your budget to find the ride that can keep you driving toward all the things that matter.