Hidden Car Costs to Put Money Away for
Whether you're a first-time buyer or an avid car enthusiast, it's essential to remember that owning a car comes with a cost. Whether it's upfront or down the line, it's essential to allocate and evaluate fees for your vehicle. Keep reading to discover some hidden car expenses most buyers forget to budget for.
Tire Replacements
Tires wear down over time, so you must have your tires checked and replaced when necessary. It's a necessary part of vehicle ownership that is often easily overlooked and should be factored into your budget.
Dealer Fees
Initially, the price displayed on a sticker at a dealership or car lot may not be the final asking price. Dealers often add on documentation, destination, and prepping fees that all add up to a costly figure. You must check with the sales staff BEFORE signing anything to ensure you are not blindsided.
Unexpected Repairs
Having a budget for rainy-day repairs should be a crucial part of any car owner's forecast. Even newer vehicles will face problems without warning. From a flat tire to an engine light warning or an electrical issue, setting aside an emergency fund is paramount.
Sales Tax
Always account for tax when making large purchases, especially when buying a car, whether new or used. The shown price is often not the final cost, and depending on the state you are in, this can range up to 10%.
Fuel Costs
Fuel costs are ever-increasing and are often an underestimated financial pitfall, especially when initially purchasing a vehicle. It can be tempting to opt for a more powerful car; however, it comes at the cost of filling your tank at a higher price. Ensure you consider fuel economy when buying a car.
Parking Fees
If you live in an urban area, you'll need to factor parking fees into your budget. From monthly permits to garage rentals and metered parking systems, it all adds up. Whether you're going to the mall or need to find parking for work, ensure you don't forget to set aside money.
Routine Maintenance
Going for that oil change is more important than you think. Getting your vehicle routinely serviced is good for your car's longevity and can prevent larger, more costly problems down the line. Brake checks, tire rotations, and fluid top-ups should all be factored into your budget.
Vehicle Depreciation
Depreciation begins the moment you leave the lot, especially if you aren't driving a car that has been highly valued by collectors. It's essential to maintain your vehicle so that when the time comes for resale, it retains its value and is not significantly less.
Title and Registration
It's a frustrating procedure, but sorting out your title and registration is a mandatory and legal step in car ownership. Failing to follow the correct guidelines can result in substantial fines. Although the administration can be a hassle, the costs can add up.
Insurance Premiums
Car insurance is a compulsory requirement for owning a vehicle. You must be aware of the exact price you'll pay, as premiums can vary significantly from car to car. Depending on the age of the vehicle, your location, and your driving history, your insurance premium will change.
Loan Interest
Not everyone can afford to pay for their car upfront. When financing a vehicle, it's essential to be aware of the interest amount you'll be paying. Ensure you calculate the total cost you'll be paying before signing off on a deal.
