Frugal Living: Vehicles

Everybody needs a car, right? Unless you live in downtown NYC or something, you probably need a car to do anything. If you don't--kudos to you! I work 30 miles away from where I live so I am definitely one that needs a reliable car. Today I will talk about how to be frugal with your car!

I have seen over and over young adults who turn 18 and immediately go out and finance a new (or < 5 year old) car. I'm sure they are so excited about being a grown up and having the responsibility of a car payment, plus being able to brag to their friends. But in the end, you will be a slave to that car payment and that full coverage insurance until it is paid off!

To parents who want to pay entirely for your kids car/insurance--don't do that either. It in no way teaches them responsibility, ownership, or what reality is like. A car is a luxury that you should earn and take care of.

1. Cash--When I was a teenager my parents agreed to pay for half of my car. I saved up my money and they matched it. As you get older it is still very wise to save up a significant amount of money (if not the entire amount) toward the car that you want. Be realistic about the kind of car that you can afford. If you are eating Ramen noodles and counting pennies, you should not be shopping for a Lexus. There are good deals to be had in used cars. If you can have a trusted mechanic or knowledgeable friend check it over then you can easily find a reliable one for a good price. Monthly savings = NO interest charges!
2. Pay Off Early--If you do have to finance a car then you should immediately start planning to pay it off early. My first financed car was a 5 year old Suzuki and I had a 3 year loan on it. I paid it off in 1 1/2 years! My payment was  $179/month and I paid over each month, plus extra when I could.
3. Insurance--Every car needs insurance. The best idea is to shop around and stick with one carrier for all of your insurance needs (home, auto, life). That way you are familiar with the company and get discounts for multiple policies. If you live in the middle of a busy city, your insurance is going to be much higher than someone who lives in the suburbs or country. Check into discounts for autopay as well as paying 6 months at a time instead of monthly. If you have a financed car then you will have to carry full coverage until it is paid off. Full coverage can easily cost twice as much as basic liablity so keep that in mind! Monthly savings = from $80/mo full coverage down to $40/mo liability.
4. Maintenance--If it ain't broke don't fix it..........that doesn't apply here! To keep your car from breaking down you have to keep it serviced! The cheapest route is of course to learn how to change oil/spark plugs/rotate tires etc. yourself (or someone you know). Otherwise you should find a mechanic you can TRUST to do this things regularly for you. It truly helps prevent major problems down the road, plus you can catch issues early on instead of when you are stranded on the highway. It is also a good idea to keep a small notebook in your glovebox to keep track of when you do your maintenance.
5. Gasoline--You can't drive without it! If you drive just a few blocks you will see a huge difference in gas prices. Ethanol, no ethanol, super unleaded, premium... The average car that is < 10 years old will run on ethanol just fine. Do some research on gasbuddy.com and figure out where the cheaper gas stations are. Stick to those, and plan on filling up when you are close to E! Don't back yourself into a corner and end up in the boonies with your gas light on. You will be forced to buy gas that is 50 cents higher than your usual place! There are about 5 gas stations within a mile from me and they regularly have at least a quarter difference in price of the SAME gas. And yes, they pretty much all get their gas from the same place. It adds up! Average savings for 10 gallon tank of gas at 25 cents cheaper = $2.50 or almost a whole gallon 

I hope this helps a little, thank you for reading! Please check out the other posts in my Frugal Living Series here!!