Expenses You Should Plan When Buying Your Next Car

Calculating your auto budget is one of the most important elements when purchasing your next vehicle. As we all know, owning a vehicle requires expenses beyond the monthly purchase payment. To ensure that your car fits your budget, here are some additional expenses you should not forget to include when buying a vehicle.

Fuel

Fuel is certainly the main expense that must be considered. Filling up your vehicle can easily add a few hundred monthly dollars to your expenses. To calculate the total expenditure related to fuel, note the number of kilometres you will travel annually, divide it by 100, multiply it by the average fuel consumption rating per 100 kilometres of your vehicle (data that’s very easy to find) and then multiply the result by the cost of a litre of gasoline in your region. Then divide the result by 12 to have the total cost.

Insurance and Registration

These expenses are less than those related to gasoline but are still significant. At least $1,000 per year is required for these expenses if your insurance history includes claims or if you are a young driver.

Maintenance and Tires

You do not need to buy tires yearly, but you still have to plan the expense. It is also important to plan for maintenance costs and oil changes. In total, all of these expenses can cost more than $1,000 a year.

To be sure you have the necessary funds for the costs of ownership, plan for at least 30% of the monthly payment in additional expenses.