One of your biggest personal expenses will most likely be the car that you own. And although it’s always going to take out a big chunk of your personal budget, there are thankfully a variety of ways that you can save a lot of money on your auto expenses.
Just like with all other aspects of personal finance, the compound effect is at play. So the more cost-saving measures you take now, the more money you’re going to end up saving. While your potential savings can vary greatly depending on what your personal situation is, there are some methods that can likely help you no matter what.
Interested in learning more? If so, then continue reading and we’ll go over all of the information that you need to know!
1. Save Money on New Car Purchases
Other than purchasing a home, buying a new car will be among the biggest single purchases that you’re likely to do on your own. Unfortunately, these purchases can end up not actually being in your best interest.
However, there are certain things you can do to make that purchase work more in your favor. Let’s go over some tips below.
Keep Your Car
First off, you should keep your car for as long as possible. As each year passes, the cost of new vehicles goes up. Cars are also notorious for quickly depreciating.
If you are frequently trading in cars, you’ll end up losing money on low trade-in values.
Instead, you should purchase a good quality vehicle and then keep it for five to seven years.
When you’re purchasing a new vehicle, you should think about buying on the smaller side. These cars will often cost you less. And because they weigh less, they tend to get better fuel economy.
Your car insurance is also likely to be cheaper with a smaller vehicle.
Check Fuel Economy
Fuel economy is very important when it comes to saving money. For example, a manual transmission vehicle tends to get about 5 miles per gallon more than automatic cars. And engines with four cylinders tend to get around four or five miles per gallon more than engines with six cylinders.
It’s also worth noting that the more air conditioning you use, the more miles per gallon you’ll be giving up.
Skip the Add-On Insurance
You shouldn’t buy credit disability or credit life insurance through your car dealer when you buy a new vehicle. Some dealers are going to do a hard sell on these policies but they’re usually very overpriced.
And if those policies get included in your auto loan, you could up paying up to five times more than you should for coverage. And don’t forget that you’ll also have to pay interest on it.
Instead, you should stay with regular disability and life insurance through your individual or employer policy.
Don’t Buy the Extras
You should always think twice when it comes to buying extended warranties or service contracts on new cars through the dealer. Many of them have extremely limited coverage (despite what the dealer is trying to convince you). And they cost a lot more than policies that are bought straight from insurance providers.
2. Save Money on Car Maintenance
After you finally buy the car, you will have to account for the cost of your gas, car insurance premiums, and monthly payment. If you buy a good quality car and keep it for many years, then you’ll most likely run into expenses for car maintenance. But that’s okay because there are many ways to save money here, as well.
Get Regular Tune-Ups
It’s important that you keep your vehicle tuned properly. If it’s tuned poorly, it will use much more gas each year. It’s cheaper to pay for the regular tune-ups instead of visiting the pump more.
Stay On Top of Maintenance
You should change the oil filter and oil every three thousand miles. This is regardless of what it says in your owner’s manual. One of the best ways to extend the life of your car’s engine is with frequent oil changes.
The oil changes will more than pay for themselves in how much you’ll save on engine wear and repairs.
Change the Filters
You should check on your vehicle’s air filter every month. A filter that’s dirty will shorten the life of your engine and also reduce your gas mileage by up to ten percent. You can clean the filter yourself by taking it out and blowing it with an air hose.
If it’s really old and dirty then you can just replace it.
Get the Right Tires
If you’re really looking to save some money, you should use steel-belted radial tires. These can increase your car’s gas mileage significantly.
Use the Right Gas
Unless your vehicle is pinging and knocking, you shouldn’t use a higher octane gas than what your owner’s manual recommends. For the majority of vehicles, you won’t get any benefit by using premium gas. Unless your manufacturer recommends a high-octane gas or you’re using a high-performance engine, you should stick with the less costly gas.
Premium gas can cost you ten percent to fifteen percent more than regular gas.
Keep Your Tires Inflated Properly
You should regularly check your tire pressure. You can lose up to six percent in gas mileage for every pound that you’re underinflated.
3. Save Money Getting From Point A to Point B
Ultimately, there are going to be expenses linked with just getting from one place to another. Let’s look at some tips that can save you some money on driving costs.
Carpool to Work
By sharing the commute with just one other person, you could end up saving hundreds of dollars a year on gas alone. Sharing the driving with two other people will increase your savings even more.
Savings are also going to vary on how far your commute is. You can also save on wear and tear and maintenance costs on your car.
Another benefit that comes from carpooling is that you’re going to end up with lower annual mileage on your vehicle. Since this reduces the chances of getting into an accident, your insurance provider might charge you less for coverage.
Just make sure that you update the average miles that you drive with your car insurance provider in order to realize those savings.
Be a Gas-Saver
Wasteful driving habits can greatly increase your fuel consumption and expenses. You can develop gas-saving habits instead. These include:
- always accelerate gently
- coast up to traffic jams by lifting your foot off of the gas pedal
- watch traffic ahead so you can avoid stops and anticipate slow-downs
- don’t drive too slow or too fast
- maintain a steady speed on the highway
It takes around twenty percent more gas to accelerate to normal speed from a full stop than if you were going five miles per hour. Also, the faster you drive, the more gas you’ll be using.
4. Save Money on Car Insurance
Car insurance can be one of the biggest expenses you have when you own a car. This is especially true if you don’t have a stellar driving record and also live in certain areas. Luckily, there are several things you can do to save some money on your insurance costs.
Increase Your Deductible
Ask your insurance agent how much money you could save if you increase your deductible on your auto collision insurance. Increasing the deductible will often save you a lot of money in premiums. And if you have a good driving history, you could come out ahead.
It’s best to shop around for car insurance. Consider looking at reputable and well-respected providers, like State Farm Insurance.
If you’re getting good service from your provider and you’re happy with your rates, then you might want to stay with them. This is especially if you’ve had tickets or accidents.
The Importance of Knowing How to Reduce Your Auto Expenses
Buying and owning a car can be satisfying, useful, and exciting. But it can also be very costly. Hopefully, after reading the guide above, you now have a better sense of how you can reduce your auto expenses.
Remember that there are all kinds of areas where you can save money when it comes to automobiles. You just have to know what your options are.
Are you looking for other helpful articles? If so, then make sure to check out the rest of our blog today for more!