How much does it cost to own a car?

Are you considering buying a car? If so, it's important to know how much it costs to own a car. There are many expenses that need to be considered before signing a sale. In addition to fuel and repairs, it is important to understand car financing schemes - and then you should be prepared for the fact that the car will depreciate as soon as it is bought.

In this post, you will learn more about the cost of a car. You'll get an overview of the many fixed and variable costs you need to be prepared for.

Below is a list of fixed costs that you should consider before making a car purchase. When we talk about fixed costs, this means that they do not change depending on the use of the car. Therefore, you must be prepared to finance most of these expenses.

By car

Many people who decide to buy a new car take out a car loan. This should be included as a fixed monthly expense in your car budget. The loan can be financed mainly in two ways: through your bank or through your car dealer partner.

The price of a car loan depends primarily on the amount of money you need to borrow. In addition, the price also depends on the application fee, as well as the interest rate at which you can get a loan.

There can be a big difference in the cost of a car loan between different cars and companies. As such, it's a good idea to compare different car loan offers before choosing how you want to finance your car.

Car insurance

Insurance is one of the biggest expenses for car owners (especially new drivers). This is because car insurance is developed on a case-by-case basis, making it a complex expense that is hard to predict.

The fact that the insurance is made individually means that it is calculated based on your age, place of residence, driving experience, type of car…

Car insurance can vary from company to company. Therefore, if you want to save money on car insurance, it is recommended to compare the offers of different insurance companies before choosing one of them.

Help on the road

Roadside assistance is one of the most popular add-ons among car owners when choosing auto insurance. Some insurance companies also offer free roadside assistance as part of their insurance policy.

Roadside assistance can be paid either as a subscription or as a flexible contract. Most car owners prefer a fixed subscription, as this means that roadside assistance is included in the overall car insurance.

Tax rate (foreign economic activity)

As a car owner, you must be prepared to pay tax on your car. A tax rate, also called a vehicle excise tax (VED), is a tax you will likely have to pay to register a new car for the first time. After that, you will have to pay every six or twelve months. This tax applies to both new vehicles and used vehicles. It is calculated based on the age of the vehicle and CO2 emissions.

However, there are some exceptions to this tax. This does not apply to disabled drivers, electric vehicles and historic vehicles. It's also important to remember that even if you don't have to pay any taxes, you still have to register your car.

In addition, there is a new tax rate for 2021/2022. In fact, if you plan to buy a car worth more than £40,000, you will have to pay an additional £335 every year for the first six years.

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An MOT check is mandatory for most vehicles older than three years. Once completed, it lasts a year. Possible failures that can harm car owners and the environment are analyzed. If you don't get your vehicle checked by the deadline, you risk being fined.

Different prices

When you analyze the fixed costs of a car, remember to focus on the variable costs.

fuel

Gasoline, diesel or electricity are some of the main variable costs of using a car. Your consumption will of course vary depending on your driving. So it's hard to allocate the exact amount of fuel in your budget until you've been driving for a few weeks. In any case, make sure you don't set your budget too low, lest you be surprised by the cost of fuel.

We recommend that you keep track of your monthly intake. So you can calculate your average fuel consumption to know how much fuel your car costs each month.

Service

Your maintenance costs depend on how much you drive and how you ride. Either way, repairs may be needed. Maintenance costs include, among other things, tire changes and vehicle maintenance.

Tire change, car maintenance and repair

Your vehicle's tires wear out with use. In addition to changing summer and winter tires, it is highly recommended to change them after 25,000 to 35,000 miles.

Your vehicle also requires a service inspection at regular intervals. On average, maintenance is recommended every year or approximately every 12,000 miles. However, this can vary greatly depending on the type of vehicle you have. For more information, we advise you to refer to your vehicle's maintenance log.

The price of car maintenance, tire fitting and repair largely depends on the garage you choose. It's important to compare prices and ratings to find the best deal for your vehicle. This is where you can use Autobutler to your advantage.

With Autobutler, you can get deals on things like car maintenance and tire changes from quality service centers near you. This way you can easily compare offers and choose the right solution for your car at the best price.

Car depreciation

Car depreciation varies greatly depending on the car model. On average, a new car loses about 20% of its value in the first year of operation.

Although there is less loss in value in subsequent years, you should expect the car to depreciate by about 50% over four years.

Below you can see the average annual discount for a new car over the first 5 years.