Finance Globe

U.S. financial and economic topics from several finance writers.
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What is the True Cost of that New Car?

What is the True Cost of that New Car?

As you begin your search for a new car, it is easy to get drawn in by shiny paint, high tech features, and so much more. While there is sure to come a time when you focus on the sticker price of the vehicle, there is something else you need to consider: the trust cost to own.

In other words, what is the vehicle going to cost you over the long run? You know that you can negotiate the sticker price, but there are other details you must take into consideration. Here are a few to consider:

1. Insurance. When you compare the cost of insurance for a new car to one that is much older, you may be surprised at the difference. Are you willing to pay more money every month for coverage?

Note: before you sign on the dotted line, contact your insurance provider to request a quote for the exact vehicle you are interested in buying. You can then compare the quote to your current premium, giving you an idea of what type of increase to expect.

2. Fuel. How much will you spend in fuel each year? It is hard to pinpoint an exact number, but you can definitely make an accurate guess.

Consider this: if you are trading in a compact car for a full-size SUV, you will undoubtedly spend more on fuel throughout the year.

3. Maintenance and repairs. As you know, some vehicles have a better reliability record than others. Along with this, some cost more to maintain. This is one area that many people overlook when calculating the cost of a new car.

Don’t get so caught up in the new car smell and negotiation of the sticker price that you overlook other expenses that could weigh you down. The three above must be considered before making a purchase.

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Monday, 26 August 2019

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