If you are buying your own car for the first time, it’s often very easy to get caught up in all the bright and shiny lights and buy impulsively, or get persuaded into buying something that you didn’t necessarily need. So that’s why it’s very important that you remain on the ball at all times, regardless of how excited you are.
It’s expensive, and you need to know exactly what your bank account is going to be dealing with before you dive into the deep end. You may be able to reduce some of the costs if you choose your car carefully, but unfortunately things like your age can end up making things a lot more expensive than they would be for others, so it’s all about playing your cards right.
Buying Your Car
The most obvious expense that you are expected to pay, is for the car itself. Now, the value will all depend on whether the car is brand new, or if you are purchasing it used, but regardless, you will most likely be expected to take out a loan unless you have a lot of savings to tap into. When taking out a loan, it’s essential that you look at different interest rates that companies are offering you, as they all vary, and you must read the small print to know exactly what you are required to do. The money that you spend on a car can – at times – be recovered when or if you eventually decided to resell or trade it in, but owning a car isn’t like a home, it doesn’t increase in price as it gets older – it decreases.
Insurance and Breakdown Cover
As much as you may think that it isn’t important or you don’t need it – you do. Unfortunately, if you’re a young driver, you will be expected to pay a lot more for car insurance because you fall into a certain category – that for the time being, will not change. The most basic insurance that you get will cover the liability: covers the damage that has been caused to another person’s property. Collision: which covers the damage to your own car if you have been in an accident. And comprehensive: which covers the damage that was someone else’s fault, but has affected your property.
The Other Bits
When you buy a car, it may not include sales tax in the final price, and if this is the case, you will have to cover the cost yourself. You will need to add more money to your overall budget so that you have full ownership of the vehicle, as well as the car registration and a new license plate if need be. This will only need to be paid once though, so when it’s done and out of the way, you don’t have to worry about it again. You will then need to be prepared to pay the annual tax, but this can vary depending on the type of vehicle you have, and where exactly you live.