10 Ways to Save Money on Car Ownership

Here are some thoughts from the great personal finance book Grow Your Money!: 101 Easy Tips to Plan, Save, and Invest. They list 10 tips for saving money on owning a car as follows:

1. Keep your cars longer.
2. Buy a used car rather than an expensive new one.
3. Do your homework.
4. Finance over three years or less.
5. Avoid cars that are more costly to insure.
6. Don't get frivolous options.
7. Don't buy the dealer's "extras."
8. Sell your old car yourself.
9. Perform routine car maintenance yourself.
10. Find a good mechanic.

I can't really disagree with any of these tips, but I personally handle these issues a bit differently. Here are my personal attitudes on each of these:

1. We keep our cars about seven years -- until they reach 100k miles or so. This is for our main car (the car I drive.) My wife's 2005 car currently has about 28,000 miles on it, so it's got a long life left.

2. I don't buy expensive new cars, but I do buy new. I prefer to own a car that only I have driven, I know where it's been, and so on. I realize this isn't the most cost-effective way of owning a car, but I prefer it, can afford it, and so I do it this way.

3. Doing your research is a KEY part to getting the best deal on a car purchase.

4. Nope. I pay cash. I already have the money saved for my next car (which I hope to get next year.)

5. I generally don't buy expensive, unusual, or popular cars, and thus my cars are comparatively inexpensive to insure.

6. As part of the way I buy a car, I determine which options I want, what their costs are, and then I request a car that has them and nothing else. I really need very few extras on a car and I'm certainly not going to pay for something I don't want and won't use.

7. Of course. I skip the extra warranty, the special rust coating, etc.

8. In the past, we've always known someone who needed a car, and we've given our old car to them. Not sure what we'll do this next time around. I'm sure we'll be able to find a needy family.

9. I'll pass on the car maintenance. I'd probably mess up more than what it would cost me to have someone else do the work. Besides, since I buy new, get good, reliable vehicles, and get rid of them around 100k miles, there's not much maintenance work to be done.

10. Hard to, but if you can find a good mechanic you'll want to keep him for life. Then again, see my comment above. I don't have much use for a mechanic thankfully.

Comments

[MC]

I agree with FMF! Some things to add:

- pay attention to consumer reports and other sites that speak to how reliable and maintenance-free you can expect your car to be--if you compromise on quality at purchase, you will pay for it later with the added bonus of hassle and being stranded.

- thinking about resale value when you buy is important. I usually buy new & sell after 10 years (which is still relatively low miles for me because my commute is very short. A 10 year old Honda Accord still has significant value; a chevy caprice--not so much.

- also re resale: don't wreck the upholstery or smoke in the car. Get dents & dings repaired and wash off salt.

The little maintenance today's cars need usually requires computerized equipment that a home mechanic can't afford.

[Craig]

I just bought a new car with the attitude and tips you have just given. I am hoping this new car will last close to 10 years and got the basic version with no options at all and bought at the end of the year when they are leftover cars to get a better deal.

[Ellen / MoneyLounge]

In my family, we usually buy used cars from people we know and trust. That way, we have seen the car around and are aware of any accidents that may have occurred and have an idea of how well-kept the car was throughout its previous lifetime.

Also, it's far less expensive to take a couple of engine repair courses at a local community college than to constantly run to dealerships and mechanics for every oil change (or anything else).

[Shadox]

Big fan of keep my car longer. I had my current car for 10 years, and not planning to sell soon. Always buy second hand. Never do my own maintenance. I am not a mechanic, nor would I want to learn the skill...

[Foxie -- CarsxGirl]

The easiest way to save on car ownership is to not care... Even cars with less than 100k need regular maintenance. I'm guessing you've never had a timing belt go on you then? (Most engines need this replaced ~75k miles, and for many, if it breaks it'll take the entire engine with it.)

From the message implied, are you saying that you don't change the brakes ever? It seems that many can take it that way, which is a hugely irresponsible message to convey. I see too many neglected minivans already, it's a huge danger to everyone out there.

Buying new does not mean a more reliable car all the time, there are lemons to be had as well. Of course, if you see your car as an appliance, I don't imagine you'd care to spend much money on it... Having nice cars isn't necessarily expensive, but most love to think that's so.

[DCS]

Watch out on #5 - cost to repair can have a substantial affect on rates, regardless of vehicle cost or popularity. My last car was a plain, inexpensive, and fairly uncommon (way low on theft desirability) but certainly not unusual or exotic Japanese economy sedan. My new car is a more expensive, AWD, turbocharged wagon. Guess which is cheaper to insure (although not by a lot)?

Seems the sedan had a tendency to require comparatively expensive repairs after minor rear-end impacts - a common source of collision claims.

[theCase]

sheesh! you don't drive much (or maybe I drive a lot). I've got a 2007 that's got 89K on it.

So far just oil, filters, and tires AFA maint. I don't expect any problems as it's a Toyota.

[Mike H]

You sell cars about when I buy them... 100K miles. I also do as much of my own work as possible. And yes, there certainly is a decent bit of work to do when you get older cars and run them into the ground (just changed the water pump on my 97 saturn with 155k miles yesterday). One extra cost savings with an older car like this one is that if you have a bit of emergency savings and aren't too accident-prone, you can drop the collision insurance coverage.

Perhaps a few years down the road my wife and I will shift to newer used cars (fewer weekends doing repairs would be nice), but right now we're focused on paying down the school loans and house.

[Michael Goode]

I'll second Mike H. on dropping collision insurance (or is it comprehensive?). My 2003 Mazda Protege just hit 70,000 miles and I have plenty of cash so I see no need to pay for insurance to cover my vehicle. Of course, I do have plenty of coverage for other people's cars ... but I see little point in paying over a few hundred a year to insure a car that is worth maybe $5k at best.

[John]

#2 They best deal is in cars that came off a 2-year lease. You don't pay the +30% new car upcharge and you know the car was taken care of (because leasers get fined when they return beat up cars), plus mileage is no more than 12,000 per year.

#4 They best deal comes to you if you can pay cash, BUT you tell them you want a loan. They make money off loans, so the price of the car can be negotiated much more. Then all you have to do is pay the loan off on the first payment. (if you are strong willed, and don't decide to go blow that cash on a big-screen and a new Harley). Make sure the loan is not front loaded (you pay interest off first) - this is a very bad loan.