Feature
Cost of living: where to save money on your car
Tips to manage your budget when buying a new car, and keep the costs down at the pumps or charging stations.
Words by: Andrew Woodhouse
Last updated on 13 December 2022 | 0 min read
Soaring inflation and the rising cost of living means we’re all having to look at our budgets and make cutbacks.
Managing spending is an important skill , so we’ve compiled the following practical tips on how to keep costs down. Share your tips with us on Twitter. This list isn’t exhaustive, nor is it guaranteed to work or apply to everyone at all times. But hopefully there are some tips in here you can use to cut the costs of running your vehicle. This article contains guidance and tips that could help – it does not constitute legal or financial advice. Visit Money Helper or Citizen’s Advice for free, impartial advice if needed.
Managing spending is an important skill , so we’ve compiled the following practical tips on how to keep costs down. Share your tips with us on Twitter. This list isn’t exhaustive, nor is it guaranteed to work or apply to everyone at all times. But hopefully there are some tips in here you can use to cut the costs of running your vehicle. This article contains guidance and tips that could help – it does not constitute legal or financial advice. Visit Money Helper or Citizen’s Advice for free, impartial advice if needed.
Cost of running a car
Drivers won’t need telling that prices are up at the pumps. We’ve written this explainer on what’s causing it, and what you can do to bring your fuel costs down.
Similarly, the ongoing rise in the cost of living has impacted every part of owning a car – from paying for replacement parts to budgeting for the next MOT. In this guide, we look at the costs associated with running a car – and where you could save money.
Similarly, the ongoing rise in the cost of living has impacted every part of owning a car – from paying for replacement parts to budgeting for the next MOT. In this guide, we look at the costs associated with running a car – and where you could save money.
How much is my car worth?
The value of used cars has been quite the talking point this year, with many drivers discovering their car could be worth more than they paid for it.
As such, a car valuation is more important than ever. Whether you need to make sure the next car you’re looking at buying is listed a fair price, or you want to know how much you’d get for selling your car soon – a valuation will give you a solid, dependable reference point. Learn more about car valuations.
As such, a car valuation is more important than ever. Whether you need to make sure the next car you’re looking at buying is listed a fair price, or you want to know how much you’d get for selling your car soon – a valuation will give you a solid, dependable reference point. Learn more about car valuations.
Cost of buying a car
If you’re buying or selling your car, it pays to know what’s going on in the market.
Buying a used car
With drivers facing waits of up to several months for a new car to be built and delivered, many are turning to the used car market for a vehicle that’s available today.
This increased demand is being met by a limited supply – especially in areas with Clean Air Zone and ULEZ regulations in place, which charge for cars that don’t meet Euro 4 or Euro 6 standards. But you’re in a better position if you already have a car. It’s not just the price of cars on the forecourts that are increasing – the worth of cars on driveways if going up too. Used cars are actually appreciating assets now, and you could actually make money on the car you already own. So, if you have a car to sell or to trade, then the impact of price growth should be fairly limited. Find out how much your car is worth today with our free car valuation.
This increased demand is being met by a limited supply – especially in areas with Clean Air Zone and ULEZ regulations in place, which charge for cars that don’t meet Euro 4 or Euro 6 standards. But you’re in a better position if you already have a car. It’s not just the price of cars on the forecourts that are increasing – the worth of cars on driveways if going up too. Used cars are actually appreciating assets now, and you could actually make money on the car you already own. So, if you have a car to sell or to trade, then the impact of price growth should be fairly limited. Find out how much your car is worth today with our free car valuation.
What to look for in a used car
• Check for signs of damage – including damage that has been fixed or masked (for example inconsistent panel gaps or signs the car has been repainted).
• Run through all the safety checks too, making sure the tyres are in good condition (including the spare), and that the seatbelts, electrics and lights all work. • Look through the documents, including the V5C registration document with a watermark and any relevant MOT or service receipts – if you have the registration you can also check a car’s MOT history online to see if it’s had any failures in the past and for a sense of how well maintained it’s been. • Check the mileage matches the paperwork and hasn’t been tampered with. • We encourage buyers to get a vehicle check to check whether the car’s stolen, imported, exported, written off, scrapped or comes with a risk of third-party trace. A vehicle check also gives data on the number of previous owners and the car’s recorded mileage.
• Run through all the safety checks too, making sure the tyres are in good condition (including the spare), and that the seatbelts, electrics and lights all work. • Look through the documents, including the V5C registration document with a watermark and any relevant MOT or service receipts – if you have the registration you can also check a car’s MOT history online to see if it’s had any failures in the past and for a sense of how well maintained it’s been. • Check the mileage matches the paperwork and hasn’t been tampered with. • We encourage buyers to get a vehicle check to check whether the car’s stolen, imported, exported, written off, scrapped or comes with a risk of third-party trace. A vehicle check also gives data on the number of previous owners and the car’s recorded mileage.
Top tips when buying a used car
• Use Auto Trader’s price indicator to see if the price being asked is still a fair one. We update this every day, after analysing data from 500,000 used car listings, plus dealer forecourt and website data, for an accurate reflection of the live market. Even as car prices change, the price indicator will show you how good a deal you’re getting in current conditions.
• If you can, take a test drive to check everything is working as it should and, just as importantly, that the car suits you. We cover everything you need to check off in our guide to test driving a used car. Find out how used car prices are changing.
• If you can, take a test drive to check everything is working as it should and, just as importantly, that the car suits you. We cover everything you need to check off in our guide to test driving a used car. Find out how used car prices are changing.
Buying a new car
The production and delivery of new cars is facing multiple delays (caused by a number of factors including the COVID and a shortage of microchips).
There’s no quick fix for this, and the high demand / low supply of new cars has driven prices up. The following does not constitute financial advice and should not be taken as such. It serves simply to make you aware of options that could warrant further research.
There’s no quick fix for this, and the high demand / low supply of new cars has driven prices up. The following does not constitute financial advice and should not be taken as such. It serves simply to make you aware of options that could warrant further research.
The following does not constitute financial advice and should not be taken as such. It serves simply to make you aware of options that could warrant further research.
• If you’re struggling with repayment, speak to your finance company or lender about renegotiating your existing PCP / lease deal, you may be able to extend it and pay less per month. Again, check sites like Citizen’s Advice and Money Helper for advice. • For many of the cheapest deals, you’ll need a good credit score, so look into a free credit check before you start. Also make sure you’re up to speed to APR and flat interest rates, so you know what a good deal looks like. Learn more about APR and flat rate interest. • If you have enough, you could use savings to buy a car outright as there’s no interest to pay – but only consider this if you have enough to cover running costs, insurance etc. and other non-car costs, emergencies, and rainy day funds • Pay monthly on a car finance deal – PCP, HP and CS all offer slightly different ways of paying, and some give you the option of buying the car or handing it back – learn more about car finance options • If your credit rating is high enough, there are 0% car finance deals check your credit score to see if you may be eligible for one • Consider a 0% spending credit card – depending on your limit. Just familiarise yourself with the pros and cons first – APR can be much higher and paying them back can be expensive once the 0% deal window closes. Learn more about 0% APR credit cards. • Consider a personal loan – rates tend to be lower than car finance packages, but they’re less flexible Ultimately, we encourage everyone to do their own research when looking at car finance and other car buying options – it’s important you understand the terms of your contract and payments, so you know you can afford your car. We’ll add to this guide as the situation develops – feel free to share your cost-cutting tips on Twitter.
• If you’re struggling with repayment, speak to your finance company or lender about renegotiating your existing PCP / lease deal, you may be able to extend it and pay less per month. Again, check sites like Citizen’s Advice and Money Helper for advice. • For many of the cheapest deals, you’ll need a good credit score, so look into a free credit check before you start. Also make sure you’re up to speed to APR and flat interest rates, so you know what a good deal looks like. Learn more about APR and flat rate interest. • If you have enough, you could use savings to buy a car outright as there’s no interest to pay – but only consider this if you have enough to cover running costs, insurance etc. and other non-car costs, emergencies, and rainy day funds • Pay monthly on a car finance deal – PCP, HP and CS all offer slightly different ways of paying, and some give you the option of buying the car or handing it back – learn more about car finance options • If your credit rating is high enough, there are 0% car finance deals check your credit score to see if you may be eligible for one • Consider a 0% spending credit card – depending on your limit. Just familiarise yourself with the pros and cons first – APR can be much higher and paying them back can be expensive once the 0% deal window closes. Learn more about 0% APR credit cards. • Consider a personal loan – rates tend to be lower than car finance packages, but they’re less flexible Ultimately, we encourage everyone to do their own research when looking at car finance and other car buying options – it’s important you understand the terms of your contract and payments, so you know you can afford your car. We’ll add to this guide as the situation develops – feel free to share your cost-cutting tips on Twitter.
For more guides and advice, visit our cars on a budget page.