No two ways about it, owning a vehicle is expensive. Aside from car payments, there’s regular upkeep to worry about, fuel, insurance, taxes, titling fees and registration. Car owners spend thousands of dollars a year on top of the cost of their vehicle just to keep their ride on the road. There is hope, though. We’ve worked up 10 great ways, from fuel-saving tips to lowering your insurance premiums, to help you save money on the cost of ownership.
Buy Certified Pre-Owned or Shop for Incentives
The best way to start saving on your cost of ownership is to begin at the buying process. While at the dealership, ask whether they have any incentives programs going on. If they're available, incentives have the ability to reduce your monthly payments or allow you to make a smaller down payment, saving you money in the long run.
Buying a certified pre-owned car from a manufacturer program instead of a brand-new model is another good way to cut ownership costs. CPO vehicles have already gone though most of their depreciation, but have also been maintained by factory service technicians and usually have low miles. A new car tends to lose around 40 percent of its value in the first year alone, so why not let someone else take up that loss? For an example, a car that cost $30,000 new in 2009 may only be worth $18,000 in 2010. CPO vehicles also tend to carry a good warranty, which can save you more cash in repair costs and regular maintenance down the road.
If you’re simply looking to save some cash on a vehicle you already own, taking a good look at your insurance policy is a great first step. If you have an older vehicle, you may look into lowering the amount of coverage you carry. After all, it doesn’t make much sense to have full coverage on an ’86 Toyota Corolla. A simple way to evaluate your coverage is to look at how much a mild fender-bender would cost you to repair. If the cost is less than what you’re paying in insurance coverage for that vehicle, you might be better served to look into a new policy. Full coverage may cost $3,000 per year, while lower liability coverage may only set you back $1,000 or less depending on where you live. Even for newer vehicles, shopping around and carrying all of your insurance policies (home, auto, business) through one provider can save you hundreds of dollars per year.
If you’re stuck with hefty car payments every month, now is a great time to talk to your lender about refinancing. If you’ve kept up with your payments and have a good credit history, you may be able to secure a new loan with a drastically lower interest rate or a more manageable monthly payment. How drastic are we talking about? That all depends on your location and your history, but knocking a few percentage points off of your interest rate on a $30,000 loan can translate into $600. Not too bad. All it takes is a few phone calls to get the ball rolling, and you could end up saving serious cash over time.
For the most part, how much gas your vehicle uses is defined by its engineering attributes – that is, the size of the car and its engine, but there are a few things you can do to improve your vehicle’s mileage by a few mpgs, leading to a little extra cash in your wallet at the end of each month. Dumping out any extra weight, going easy on the throttle and keeping up with your vehicle’s regular maintenance can noticeably bump up your car’s performance at the pump. For an example, if your vehicle gets 22 mpg and you drive 12,000 miles per year, upping your vehicle’s fuel economy by 2 miles per gallon can save you $112 at $2.50 per gallon – more if gas prices inch back up. It’s probably the easiest thing you can do to save cash on the cost of ownership.
Speaking of maintenance, next to keeping your vehicle’s fuel consumption in check, nothing impacts your ownership costs more than regular maintenance. At first, it may seem painful to shell out cash for regular checkups and oil changes every three months, but doing so can head off serious repair jobs and keep all of your vehicle’s systems running the way they should.
Before you head off to an independent repair shop, check whether your vehicle is still under warranty. Many people unnecessarily avoid the dealership without realizing that their maintenance and repair costs are still covered. If you aren't under warranty, take the time to shop around and get quotes for repairs. Prices shouldn't be drasically different from shop to shop, but having a quote from a competitor can prove to be a valuable bargaining chip.
Listen to Your Car
Every few months, turn off the stereo and listen to your car. Do you hear any grinding or banging noises? Any tapping or piging? Knowing how your car sounds when it's in good health makes diagnosing any problems that much easier.
Tires are an incredibly important part of your vehicle. They’re the only part of a car or truck that actually touches the ground, and they are responsible for how your vehicle stops and turns, so don’t run out and get the cheapest tire available. Knowing what kind of tire to use when, however, can save you plenty. For most of the country, a good all-season tire should be just fine, but if your car came equipped with summer or sports tires, be sure to get an appropriate set of winter shoes. Failing to do so could increase the likelihood of an accident, upping your insurance premiums and lowering your vehicle’s resale value.
Think the only way to enjoy driving again is to get a new vehicle? Before jumping into a new car payment, consider simply upgrading your current vehicle with aftermarket components. Everything from GPS to Bluetooth-enabled stereo systems can give your older car all of the sophistication of a newer model for a fraction of the price. Many systems, like Garmin’s GPS units, are easy to install, and those that aren’t can be handled by local car audio shops.
When it does finally come time to send your old car or truck along, taking your time and selling smart can put plenty of extra cash in your pockets. Getting your old ride as clean as can be, fixing simple problems that could detract from the value by using paintless dent removal and knowing what your car is worth are all great steps toward getting a better price for your used vehicle. Of course, knowing where to sell is just as important, so take advantage of online selling services to make your car or truck available to the most potential buyers.