We all remember our first car with fond memories. That sense of independence and freedom that it gave us.
However, that freedom can come at quite a price. Here are 5 cost considerations to bear in mind when buying your first car:
1. Outlay for the car itself
You might think it is cheaper to buy an older, second-hand car but you need to keep the following in mind – engine size and model can affect your insurance premiums and if you want to take advantage of telematics for your insurance, you also need to think about the age of the car. You can of course borrow your parent’s car and get added to their insurance policy but remember if you are the genuine main driver of the vehicle this can invalidate the insurance policy all together (this is a practice known as ‘fronting’).
2. Running costs
According to The Money Advice Service, a small used hatchback costs around £1,400 per year to keep on the road which includes wear and tear, cost of new tyres, tax, MOT, and fuel.
3. Driving lessons
The BBC estimated that passing your test can take, on average, 45 lessons which is likely to cost over £1,000. However, it is worth investing in this as a safer driver will reap rewards in terms of no claims discounts and this is particularly important in your first few years of driving.
4. Advanced Driver’s Qualification
Once you have passed your test, you can take an advanced driver’s qualification which may help reduce insurance costs. This is not guaranteed, however, so do check first before committing to this expense.
5. Insurance costs
Latest figures suggest that the average cost for car insurance for a 17-22 year-old is close to £1,300 per year. (Source: MoneySavingExpert.com). There are ways to reduce costs, however, without reducing your cover. Under-25s can take advantage of a telematics-based insurance policy (also known as black box policies) which reward you for safer driving and allow you to build up that all important no-claims bonus. Nevertheless, you should still check with your broker as some older cars cannot be insured under such a policy and there can be restrictions regarding driving at night. Lastly, get some specialist advice from a good insurance broker who will help find the best-priced policy for a young driver without compromising on cover.