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It’s easy to get carried away with emotion when you want to buy a new car. That's why you must know the actual cost of buying a car so that you are well-prepared and do not feel disappointed a few months later.
We created this article where we list the expenses you must take into account to feel safe with your next purchase. Read on and learn everything there is to know about the actual cost of owning a car.
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View articleFive Expenses You Must Keep in Mind if You Want to Buy a Car
You have most likely already thought about it a lot, saved every last penny, and are ready to buy that car you liked. Before you run to the nearest dealership to sign the paperwork, it's a good idea to know the actual cost of owning a car.
You want to make sure you understand all the expenses surrounding the purchase. Here are some essential things to keep in mind:
Insurance Premiums
One of the most important things to keep in mind is insurance premiums. Insurance costs represent a relatively significant part of the total purchase price of a car and depend on a wide variety of factors.
The premium cost depends on your age, where and how much you drive, deductibles, accident history, and the car’s make, model, and price of the vehicle.
Once you know what car you're buying, consider getting quotes from three or four insurance providers. This will give you a better idea of the actual cost and help you choose an insurance provider that suits your needs.
Make sure you get all the discounts you're entitled to. Discounts for safety features are automatically applied to your fare, but deals related to a student driver or safe driving habits may not be.
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View articleFuel Expenses
Do you know how much gasoline the car you want uses? Try to find a good balance between the vehicle’s characteristics and the time you can go without refilling the tank. And remember that, if you're commuting to work or have a road trip coming up, you'll start to notice the effects on your mileage almost immediately.
You can also consider a hybrid or electric car. It may be more expensive to purchase, but you'll likely save money in running costs in the long run.
Maintenance Expenses
Not only is it important to calculate how much a car is going to cost, but also the cost of owning it. Second-hand cars may be cheaper to start with, but, in return, they may require more maintenance; while newer cars will cost you more but should run longer without needing to be serviced.
Also, you should check the manufacturer's maintenance requirements, which may limit the car's service or the places where you can do it.
If you're concerned about regular maintenance costs, consider purchasing an extended warranty.
Car Depreciation
Although depreciation may not be something you initially thought about before buying a car, it is essential. For the maximum value, it's better to opt for a used car than a new one.
This is because new cars lose value much faster than used ones, and this can be especially true in the hands of a new driver who may be more prone to adding minor, or even major, damage to the vehicle. Insurance is also likely to cost more with a newer model, while there are often more affordable ways to insure young drivers if they drive older, lower-value cars.
Buying and maintaining a car on a budget can be easy as long as you consider all the additional expenses that come with it. Finding out about potential prices for things like insurance and fuel costs can help you make the final decision, and once you do, you're sure to get all the benefits of becoming a car owner.
As always, remember to assess your own situation. Find a car that fits your lifestyle and plan ahead to make sure you account for the total purchase cost.
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The contents in this section are provided for informational and educational purposes only and do not apply to all types of situations. The contents should not be construed as any type of advice or suggestion to take (or refrain from taking) any particular action, as it does not include or take into account all factors that may be relevant to your individual needs.