10 Secret Costs of Buying a Car
If you’re in the process of buying a car, lots of people will tell you to focus on building up a large down payment or trying to get the best APR possible. Both are important, but not the only things to look for when car shopping.
A large amount of research should be done beforehand to get a more realistic look at what it’s going to cost you not just initially, but over the lifetime of the car. Maintenance, insurance, and certain features can increase or decrease the value of the vehicle or what you’ll end up paying down the line.
Here’s a list of things to cover while you look for a new car.
How expensive is maintenance? Those luxury cars cost luxury money for something simple like an oil change. The average cost of a BMW oil change is $100 to $150 regardless of if it’s new or used. Imagine how much money a 50,000-mile service costs. This isn’t just for luxury cars either.
How expensive are parts? I drive a 2017 Hyundai Santa Fe. Our battery died last summer and it cost $350 to replace. Why? Because newer cars have more electrical components and some require specialty batteries because of it. Also, the location of the battery takes longer to get to and replace. Meaning the product and the labor is more expensive. Foreign cars tend to be more expensive because they need specialty parts that have to be shipped in or fixed by specialty mechanics.
Front-wheel, rear-wheel, or all-wheel drive? These all have different price points and different pros and cons. We have all-wheel drive, which added cost to the vehicle but also our tires and gas mileage. AWD requires special (aka more expensive) tires which we have to budget for. This might not be a big deal to city dwellers, but those that live in snowy or rainy places might find those features a necessity.
Manual or automatic? Manuals usually cost less and get better gas mileage, but you have to know how to drive a manual car. Automatics are easier to drive, but also can add a few thousand dollars to the price.
How much does your insurance change? The mileage, make/model and features of your car can drastically change the price of your insurance. Contact your car insurance beforehand and ask for quotes based on what you’re looking at before you get to the dealership.
Speaking of features, what kind do you want? Adding upgrades or choosing a car with certain built-in features can up the price. Things like the trim, heated seats, or lane change alert all can add to the value of the car.
Registration. Some states assess registration fees based on the weight of the car and others by the year it was made. Both can have a significant impact. The van we had in Maui was an absolute beater. It honestly shouldn’t have been running, but it was. It cost almost $400 to register because it’s a heavy-ass vehicle. Here in Nevada, it’s done based on the year. A car from 2000 might be less than $100 to register, while my 2017 Santa Fe is $350.
Have there been any recalls? Kelly Blue Book is a great source for all things cars. They have a feature that allows you to see if any recalls have been issued for either the year/make/model you’re looking at OR you can enter the VIN of the actual one you’re looking to purchase. While most dealerships should fix these before putting them on the lot, private sellers might not check.
Gas efficiency! This one is probably going to be the most noticeable for you right away. Do research on the gas mileage! We had a Santa Fe previously so we already had an idea of how much it would cost to fill up our new one. If you’re switching to a bigger vehicle, definitely check the gas mileage!
What is covered in your insurance and/or service plan? There are always stipulations on what they’ll cover. This is why a sinking fund for your car is very important. Nothing like thinking your transmission repair is covered only to find out you passed the mileage threshold and the bag is on you.
I know it seems like a lot, but cars are a big purchase even if you get something used. You’ve just taken on a high-ticket item that needs to be cared for. Get the full picture before you plunk down the money.
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