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by Marsh Finance on Aug 8, 2024 3:00:00 PM
As we go through 2024, understanding all the costs that come with a car is key. At Marsh Finance, we believe in giving our customers the knowledge they need to get the best car finance deals. This article aims to shed light on the various expenses of owning a car in the UK, providing a clear picture for car owners.
Understanding The Purchase Price And Depreciation
You might be looking to get a car in the UK. Don't fear, you have lots to choose from. If you want a car like the Ford Fiesta, you'll have to pay around £18,000. For a more premium model like the VW Golf, you will have to pay around £30,000. However, the cost of buying a car is just the beginning. Depreciation plays a big role in car ownership. The average annual cost of depreciation is around £1,104. Depreciation is when your car loses value over time. This happens to everyone, and starts as soon as you drive out of the dealership. Making sure you know about the depreciation of your car is key. To know how much your car will be worth in the future, get a good idea of your depreciation. Alternatively, buying a used car can save you money. Used cars don't lose as much value as new cars right away. This means you might be able to sell it for more later.
Fuel Costs: A Major Expense
Fuel costs a lot these days. Petrol and diesel prices seem to always be going up. Currently, it can cost over £1,400 a year to fill up your car. How much you spend depends on how often you drive and the type of car you have. Make sure you have money set aside for fuel. Without it, you're not getting very far!
The Insurance Factor
On average, UK car owners spend about £561 each year on insurance. Car insurance costs change a lot. There are lots of things that affect how much insurance you pay:- How old you are
- What car you have
- Your driving record
- Where you park your car
Maintenance And Repairs: An Ongoing Commitment
Taking care of your car costs money. You'll need to spend about £273 a year on things like oil changes and repairs. As you might expect, older cars usually cost more to fix. If you are interested in a used car, make sure you are ready for the added costs that might come.
Additional Running Costs To Consider
There are other costs too. You'll need to pay a yearly tax called road tax. This works out at about £141, which isn't too large an expense. Parking and using roads can cost around £44 a year. And then there are little things like washing your car or paying for a garage. These can add up to about £259 a year, another cost to think about.
The Shift To Electric Vehicles (EVs)
Electric Vehicles (EVs) have an interesting relationship with price. Electric cars cost more to buy at the start, but they're cheaper to run. Obviously, you don't have to pay for petrol or diesel. This means you can save lots of money in the long run. You'll spend about half as much on charging an electric car compared to filling up a petrol car. One thing to think about is charging time. EVs can take a while to charge, and you need to plan charging stops into long drives. Don't get stuck somewhere without charge!
Understanding Optional Expenses
You might be a car enthusiast and want to join a motoring group. This will of course cost you. A more common expense is driving lessons. These are not cheap, and if you are learning to drive you need to take into account the cost of lessons to your overall budget for a car. While these costs are not mandatory, they can contribute to the overall financial commitment of car ownership.
Considering Car Finance
Buying a car on finance is a really good way to get on the road sooner. It's important to know how much you'll pay each month, and how much extra you'll pay in interest. There are extra fees too, so it's a good idea to use a car finance calculator. This can help you figure out the total cost. Click here to use our calculator.
The Bottom Line On Car Ownership Costs
Owning a car can be expensive. On average, it costs around £3,580 a year to run a car in the UK. But this number can change a lot depending on a few key factors:
- What kind of car you have
- How much you drive
- Where you live.
Our Two Cents
The costs don't stop once you buy the car. Fuel, insurance, and car tax are regular expenses. You'll also need to pay for things like repairs, new tires, and the car losing value over time. It's important to think about all these costs when deciding if you can afford a car. At Marsh Finance, we are here to help you. With tools like our finance calculator and comprehensive car marketplace, we make buying and paying for your car easy. With today's economy, getting a new car can be tough. We help you find the best deal and payment plan. 🚗💡📊💳
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