Buying your first car: Costs to budget for

If only the price tag on that new or used car you’ve been considering was all you needed to factor in to the finances and hand you keyless entry to driving freedom. Dream on. Buying a car is just the beginning of a motoring expense trail you’ll find yourself going down, whether you like it or not. The trick is to be prepared beforehand.

Researching up on the running expenses and options you are likely to encounter when you buy your first car will help you make a more informed decision at this crucial point in time. And when it’s your very first car, disappointment number one is often that your heart must be overruled by your head, unless of course, you have extremely rich parents or an uncle who owns an Audi dealership!

Even if you have to downsize your dreams first up, it really is possible to find true driving happiness if you stick within your own budget limitations. Here are a few key points to consider in the overall running, repair and maintenance cost encounters that will affect your budget in the future.

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Everyone thinks about the gas-guzzling capabilities of a car first up. I guess it’s the most obvious consideration because if you can’t afford the petrol, you’re going nowhere fast. Does your car use regular, premium or ultra-premium unleaded petrol, diesel or LPG?  Petrol is by far the most popular fuel source, accounting for in excess of 80% of the 18,893 million litres of fuel used in 2014, so the Australian Bureau of Statistics (ABS) tells us.

The ABS also tells us that 10.7 litres per 100 kilometres was the average fuel consumption for passenger vehicles in the year ended 31 October 2014. Which brings us neatly to pump prices. This is always an area of contention as prices fluctuate from low to high, according to supply, as well as the city or country region where you are filling up. According to average prices (as at 22/11/15) range from 135 cents per litre in Sydney to 114.6 in Adelaide. Check  motormouth’s fuel cost calculator to help you nut down what your car is likely to use. Identifying how many litres your car will use to run a distance of 100 kilometres is also a useful benchmark to cost-effective performance.

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Cheapskate alert:  Don’t be tempted to run your vehicle on petrol with an octane below that recommended for your vehicle. According to NRMA, it’s likely to result in a ‘knocking’, ‘rattling’ or ‘pinging’ sound which means the fuel is detonating instead of burning smoothly. A waste of energy which may also result in long-term engine damage. On the flipside, NRMA says it’s a widespread but misguided belief that if you use a high octane fuel your car’s performance will automatically increase. Not so, unless your vehicle’s engine is designed for it. Your car’s owner’s manual will clarify what type of fuel your engine is designed for.

It stands to reason that taking good care of your wheels will pay dividends as time goes by. Maintenance costs include servicing according to the manufacturer’s schedule, plus repairs and spare parts that are likely to be required for normal driving conditions and assumed annual distances. There is great variance, once again, between new and used cars. Competition for sales is resulting in many new car manufacturers offering free or capped price servicing deals for a set number of years built in to the purchase price. New cars are also covered by a warranty which provides some certainty about future operating costs. New car warranties differ, but may typically provide cover for 3-5 years and 60,000-100,000 kilometres.

That’s not to say a used car is a second-rate purchase. It’s just that they are totally different animals and hard to compare against each other, as new and used have their own advantages and disadvantages, according to personal circumstances. It’s not unreasonable to expect to deal with many unscheduled items such as brakes, a battery, windscreen, headlight globes and other parts that may need to be replaced in five years of ownership.

Cheapskate alert: Think twice before fitting non- standard parts to your car. It may void your car insurance policy.

RACQ has put together detailed comparison tables on car running costs for all popular cars to give you a better idea of money you will be up for over a five-year period in your own situation. These can be found at

Tyres are included in this consideration. As the only thing connecting your car to the ground, tyres are one of the most important parts of the car. Included in RACQ’s comparison are 4 replacement tyres during the 5 year period plus 1 tyre assumed wrecked from puncture damage beyond repair. Replacements include fitting and balancing.

Double cheapskate alert: Your tyres can contribute to overall costs in other ways. Incorrectly inflated, they can add to fuel consumption. Incorrectly aligned, they will cause premature tyre wear and you’ll have to replace them more frequently.


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