Allow for Ongoing Costs When Buying a Car
When purchasing a car don’t just look at the purchasing price as the only expense. Ongoing expenses add up; what might appear to be a cheap car, could turn out to be very expensive when taking into account servicing fees, insurance, and fuel. Lets quickly discuss each of these factors.
Servicing Fees
A 20 year old wagon might cost a handful of coins, but what good is the car if, after 3 months of owning it, it breaks down and the work required to get it going again is costs more than you bought it for? Newer cars are less likely to need servicing, and when they do labor and parts are easily available (if the car make and model is popular). Older cars might require parts that are out of production, whilst mechanics these days are trained in upgrading the latest model cars, so an older car could cost more due to the increased amount of time the mechanics would need to spend working on it.
Insurance
Older cars sometimes have higher insurance premiums. This is because they have old safety features, and due to general age and wear and tear are considered more likely to i) be the cause of an accident, ii) struggle to avoid accidents that newer cars would avoid, and iii) be written off when in an accident. All these factors add up to making an older car be more of a risk for insurers to insure. It is true that the value of the car will be less than a newer car, therefore wouldn’t cost as much if the insurer needs to make a payout, but on balance of increased risk the insurance could be equal or more for the old car than the new one. Shop around to find the best car insurance for you.
Fuel
Older cars less economical than newer cars. With improved technology, due to consumers desire to spend less on petrol as well as environmental reasons, cars are generally getting more and more economical with every new model. Back when fuel was cheap, global warming wasn’t getting much attention, and new technologies in fuel consumption wasn’t a huge priority, cars used to burn a lot more petrol than newer ones do today, over the same distance. Having an uneconomical car can really increase annual fuel expenses by a noticable amount.
Conclusion
Although on the face of it you may appear to be saving a lot of money by opting for an older car, when adding up running costs you may infact be paying more. All of the above mentioned factors should always be considered before buying a car, especially an older car when the fees can really be expensive.
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