As if car insurance wasn’t already a guzzler of disposable incomes, we motorists are about to be hit even further. Essentially a Government statute has ordered insurers to pay more in compensation to those who have suffered life-changing injuries. A great concept in principle. However, it is likely that the burden of this will invariably fall on the typical consumer, and prices are thus set to fly up by as much as £1,000 per year (for young drivers) for this reason alone!
It’s likely to price many people out of car ownership, but for those who do already have a car, or are planning on getting one, it’s an alarm bell that should trigger us into action to find other ways to cut costs.
How to be a thrifty car owner
Saving on fuel
This is the most practical and easy way to save, and there are a number of ways to make small, but significant gains on this front. Fuel efficiency can be improved by doing little things like only half-filling your car up at the station each time. After all, a heavier car will always use more fuel. Decluttering will also help the cause too, as will removing seldom-used roof racks.
There are some other tricks too, and they aren’t old-wives tales either. Going easy on the accelerator, easier still on the brakes and changing up gears sooner all helps the cause. But, whatever you do, don’t glide around in neutral. Not only are the savings negligible, but it’s dangerous too.
Finally, the other thing to make the most of is loyalty schemes. You want to ensure that your beneficiary provider of choice does, in fact, offer competitive prices for fuel, but think of it like this: if you spend £30 a week on petrol or diesel, that’s £1,500 a year. So slashing even 5 percent off that through a loyalty scheme is a healthy saving to make. There are some handy tricks you can use to maximise this too.
Sorting out your financing
If you are looking to buy or upgrade, one thing to give some careful thought to is car finance. There are a number of ways to go about it, and each individual situation will be different. But so often buyers lazily choose to simply accept the offer put forward by the dealer, or, worse still in the case of second-hand cars, lump the cost of the car onto their credit card, which will have an astronomical APR.
This is a time to put a bit of effort into scoping out alternatives. Leasing and hire purchase are popular options, while personal contract plans are almost single-handedly driving the motor industry. Often forgotten are unsecured loans to finance car buying, which, these days, can be incredibly cheap. Whichever route you decide to go down, it’s one you want to make sure you get right, as (re)payments will be a long-term fixture, and you don’t want to end up paying a penny more than you have to.
Save on insurance
With rising premiums, it’s more important than ever to find the best deal on insurance that you can. Shopping around is obviously key, but it isn’t just about the cheapest provider. Indeed, there are certain things that you can do which can shave plenty off the costs. ‘Tweaking’ your job description, paying annual sums (rather than monthly), avoiding auto-renews, setting the optimal excess value and locking in today’s prices with long-term quotes are all ways to ensure you can skim off the top of your insurance costs.
At the end of the day, cars are expensive, depreciating assets by nature, and it is, unfortunately, something that will invariably eat into your budget. But with a bit of savvy, and not too much effort, you save hundreds of pounds each year, freeing up more money to spend on the things you and the family really should enjoy in life.