Controlling the cost of driving

car finance

Controlling Cost of Driving

2010 saw the first fall in the number of cars on the roads since the Second World War – a result of the national tightening of belts.  At the time the government was also running a scrap page scheme, which took older cars off the road and out of the second hand market.  As the green shoots of the economic recovery remain rather brown and withered, many households are facing the choice of keeping or ditching their cars.  Reports suggest that many second family cars have already made their way off the driveways of affluent middle England, destined for either the scrap yard or the second hand trade.  For those on less-than middle England incomes, losing one car many mean losing the only car.  So are there ways in which we can economise and keep ourselves mobile?

Savings you can control

There’s nothing certain in life other than death and taxes.  You can add car tax and insurance and the ever increasing cost of fueling a car to that list.  You can’t and shouldn’t skimp on either car tax or insurance.  Un-taxed and uninsured vehicles are now more traceable than ever, as regulations allow the DVLA and insurance companies to operate on an “I’ll show you mine if you show me yours” basis when it comes to records.  Untaxed, uninsured drivers face all kinds of fines and even crushing defeats – in the form of car crushing that is.  The long term cost of not insuring or not taxing are just not worth the ‘savings’ they appear to offer.  While tax and fuel costs are not easy to take control of, insurance at least can be shopped around for.  This is a must for any driver, of any age, gender or postcode!  The market is competitive and to some extent a buyers one.

If you have down-sized to a one car family – not by selling the kids, by selling the second car – insure the lowest risk driver as the main driver; beware of ‘fronting’ if you add a low risk driver to the policy who never drives the car you could fall foul of the law and invalidate your insurance.  However, for couples who both genuinely share the car, then this can save significant amounts.

Fuel efficiencies

You can’t set the price of your fuel unless you run a petroleum giant or a country – in which case you probably claim on expenses and don’t care anyway – but you can limit your consumption.  If it is feasible cut the commute – this will cut your insurance premium as well, so is a two birds one stone result.  If you can only partially cut it you’ll still make a saving; by a combination of car sharing, occasional exercise and the odd use of your own car to commute the effect on pounds can be impressive.  On the financial front you’ll gain some, on the middle-aged spread front you’ll lose some.

For the truly green and pleasant, converting the car to cooking oil can work.  The smell is not as bad as you think but there are side effects when it comes to your diet.  After even the shortest journey you’ll end up craving chips.  Also, beware the customs man; you still have to pay duty – not as much – but the penalties are harsh if you don’t.  Remember customs men will be able to sniff you out.  This is probably an option only for the true eco-warriors at the moment, but we’ll all be driving on cooking oil when petrol reaches £5.00 a litre; which it will.

Advantages of buying new

Get a new car.  Daft as it might sound to those looking to cut costs, buying new can save you money.  The main benefits are that new cars are more reliable than old, so less breakdown and recovery bills.  New cars are being designed with the most effective fuel efficiency measures that technology allows for.  There is widespread acceptance in the car manufacturing industry that we need to move to electric powered vehicles, but this acceptance is countered with a healthy dose of realism in that the infrastructure does not yet exist.  In the meantime fuel efficiency is the buzz word.  Costing less to run, a new car can make a big difference.

If you’re feeling adventurous you can go for a hybrid or even a fully electric car.  The later have some benefits as city run-around. The UK government will give you £5000 to buy one and they are investing in re-charging points in ‘selected cities’.  Another post code lottery, but if you’re in the right place, now might be the right time to consider taking up the offer.

Buying a new car using car finance may be an option too.  Hybrid, petrol, electric or diesel – whichever you choose it’s going to offer a better fuel efficiency if it’s new.  If new is out of your existing budget then consider finance as an option.  The savings a new car can offer can outweigh concerns about taking on further finance obligations and can be an option for many people.