We might all differ on what we consider to be the perfect or ‘dream’ car, what’s good value for money and which brand is most reliable, but one thing we can all agree on is the fact that buying a car is a big investment. A lot of hard work, effort and planning goes into saving for a car.
Here at Aviva, we want to hel you with your big purchase. That’s why we’ve put together some simple steps to help you save money for your car.
Saving for a Car Tips
1. Set savings goals
Start off by getting friendly with budgeting tools and apps. Next, set goals. Saving without goals is a bit like travelling without a map. Decide what car you’re hoping to buy, figure out how long you have to save up, and work out reasonable monthly saving goals. Keep in mind you’ll need to take unavoidable costs into account, like insurance and tax!
2. The 10-second rule
If you’re about to buy an item that isn’t absolutely essential, give yourself 10 seconds before dropping it into your basket. Ask yourself the really tough question, do you actually need it, or do you just want it? Also, can you find a better value option? You’ll be surprised at how often we purchase wants rather than needs.
This one might feel like a bit of a pain but remember, it’s not forever, and the end goal is worth the effort. Now, put down the limited edition, €5.99 puppy patterned kitchen paper!
3. Shopping list
Write a shopping list before heading to the shops and stick to it. Heading into the shops with no structure leaves plenty of room for impulse or excessive buys, trust us we’ve been there! Pick a day where you can buy a full weekly shop so you can avoid mid-week trips to the shop for a litre of milk, which often results in an arm-full of other items.
4. Pack your lunch
A lunch out can easily set you back €10 or more. Before you know it, you’ve spent nearly €200 in a month on something that honestly could have cost you a tenth of that. Make bigger portions of your dinners and keep, or freeze, leftovers for lunches. Instead of spending €5 on a takeaway sandwich, spend the same in Lidl and buy the makings of five sandwiches for the week. Your health will also thank you for this one.
5. Sell the non-essentials
Go to each room of your home and make a list of all items that you don’t consider sentimental or essential and start flogging them online. Done deal, Gumtree, Depop, Ebay and Amazon are good options. This a win-win situation as it makes you some extra cash and declutters the house as well.
Some handy tricks to keep in mind
Shop for your car in the slower sale months like June, November and December because people are hanging on for the new registration periods. You’re more likely to get a good price from a dealer in the slower seasons.
As we’ve covered before in our improve your car resale value article, cars depreciate in value between 15-35% in the first year. This means a car that is at least one year old will be cheaper, and still in good condition.
Ex-demo cars are new cars that have been registered to a garage to be used for test drives. These cars generally have optional extras included and are kept in great condition. After a few months, these ex-demo cars will be sold by the garage at a lower price.
How Much to Save for a Car
A common question car buyers ask is “How much should I save for a car?” There’s no easy or quick answer to this question but here are some things to consider when thinking about how much to save:
- If you’re thinking about a finance option, calculate your car down payment. The amount you’re willing to put down will depend on what kind of car you wish to buy and your financial situation. The more down payments you make, the lower the cost of your monthly payments.
- If you wish to purchase the vehicle outright then you’ll need to take into account the make, model and age of the vehicle. Older cars that are more than 10 years old can cost less than €5,000. However, these cars may mean more money might need to be spent on breakdowns down the line.
- Newer cars can cost anywhere from €25,000 - €50,000+ so you may need to take out a hire purchase agreement if you don’t have enough savings.
Once you’ve chosen your perfect car, let us protect it with Aviva car insurance.