Worried about your car becoming a money pit? A money pit is something that drains your financial resources. Some money pits are well-known: One is buying a ramshackle home that translates into a significant monetary loss. Another is misusing credit cards, an easy ticket to losing money that would have otherwise been channeled into your retirement account or child’s education fund.
While anything can become a money pit, others are less noticeable. Take, for instance, cars. When buying a car, you’re usually thinking of a means of transport to get you from point A to B. But cars are a ravenous wealth destroyer. From the initial outlay, refueling, maintenance, insurance, and repairs, car owners spend thousands of dollars every year for the privilege of driving on the road.
In fact, cars are second only to houses as a top contributor to most people’s debts and poor savings. Thinking of ways to reduce the running expenses associated with car ownership? Buying a used car warranty might help you deal with the cost of unforeseen breakdowns. Apart from that, let’s look at the things that cause your car to literally drain cash out of your wallet and ways to stop it.
Reasons Why Your Car Is a Money Pit
Lack of Preventative Maintenance
Some motorists choose to take their chances and ignore preventative car maintenance. One reason could be the lack of auto repair financing due to the absence of insurance. Routine service may seem like a needless cost, time-consuming, and a potential rip-off by conniving car mechanics.
According to data gathered from National Car Care Month inspections, some of the car parts that are often neglected include:
- Dirty or low-level fluids.
- Worn out or contaminated antifreeze.
- Dirty air filters.
- Damaged belts and hoses.
You’re exposing yourself to constant trips to the mechanic and unforeseen repair bills when you skip preventative car maintenance. Similar to a human body, your car needs regular maintenance to steer clear of breakdowns down the line. Ideally, you should observe your car’s service schedule. This will ensure you’re up to date on all maintenance.
Old Car Restoration
A majority of car enthusiasts delight in owning an older or classic car. That old car may seem like a fun project. However, purchasing it could literally suck the cash out of your pockets.
Are you aware that it may cost you up to $100,000 to refurbish a classic vehicle? While ordinary vehicles may be costly to maintain, restoring an old, classic car can really put a dent in your pocket. You may consider applying for an auto repair financing loan to handle the restoration. What’s even worse: Even if you successfully restore the car, it won’t fetch you as much as what you put into it when you decide to sell it.
Poor Driving Habits
The way you drive has a close correlation with your car’s fuel consumption, tire wear, engine and brake performance, and transmission integrity. Driving your vehicle at a higher RPM (revs per minute) range translates to higher fuel consumption. And if you love to shift gears regularly, your engine might experience toque variation output, resulting in more fuel use. Ideally, you should be slow and steady when accelerating and braking.
Almost every driver has visited their local repair shop for routine car maintenance, only to drive away exasperated. This is after paying over the odds for minor repairs. The majority of mechanics are sincere, diligent people who will detect and point out issues you may not know of.
However, some mechanics are unscrupulous and want to rip you off your hard-earned cash. They will overcharge, recommend unnecessary repair services, or do a shoddy job that you need to come back several times to get it fixed right.
Prior to agreeing to any maintenance, counter-check your car’s maintenance schedule. This is the only schedule you should adhere to, unless an urgent problem has surfaced to warrant urgent maintenance or repair.
For instance, many car owners still follow the 3,000-mile oil change misconception planted in their minds by some mechanics. This means that you change the oil a lot frequently, which leads to more spending. Ideally, oil changes are scheduled between 6,000 and 10,000 miles by auto manufacturers.
Perhaps your car has been subject to constant repairs ever since it got into an accident. Or maybe your engine has been giving you problems every time. Regardless of the situation, constant repairs can heavily drain your pockets.
Whether it’s mechanical troubles, body damage, or something else, some fixes are not worth persisting on with. Ideally, you should determine if the cumulative vehicle repairs cost more than the value of the car. The Kelley Blue Book is a great resource to find out your car’s current market value.
With this in mind, here are some car tips to take into account, so you don’t end up with a money pit.
Tips to Help You Reduce Expenditure on Your Car
Get Cheaper Car Insurance
Car insurance is a legal requirement in most states, making it an unavoidable expense related to car ownership. Are you overpaying for car insurance? Many motorists sign up for a car insurance policy and become loyal for several years. However, the premiums may continually go up to an extent where you are overpaying for auto insurance.
How does this happen?
Car insurers look at multiple variables to decide on your monthly premiums. These include age, driving history, and mileage. However, other insurers mine data from different platforms and use it to carry out ‘price optimization’ on your premiums, as claimed by USA Today.
Basically, car insurers set premiums just high enough to stop customers from searching around for alternatives. Due to this process and the fact that the longer you stay with an insurance provider the less likely you are to leave, the rates can rise every year.
So what’s the solution?
- Shop Around: While you can’t escape price optimization, you don’t have to be helpless in the face of rising premiums. The trick is to shop around for better deals from other insurance providers.
- Bundle Your Policies: As with any industry, insurers want you to sign up with them for all your different insurance needs for the longest duration. With that said, many offer price cuts when you enroll for multiple policies.
The most popular policy bundle is combining your car and homeowners’ policy from the same insurance provider. A study by InsuranceQuotes reveals that the average customer saves 16.1% on insurance premiums when they bundle these two policies. For example, Allstate offers a 25% discount when you bundle both home and car insurance. Likewise, Progressive claims new clients will save $1,000 per year on average when they bundle their home and car insurance policies.
Routine preventative maintenance will cost you money. But the good news is it will keep your car working optimally, which means that you’ll avoid bigger mechanical issues down the road. You don’t want the type of problems that leave you needing roadside assistance and with a hefty repair bill to deal with.
Given that vehicles have lots of mechanical parts, many things can go wrong when you least expect them. Here are some important routine maintenance practices to factor in if you want to avoid costly repairs in the future:
- Oil change: Most car manufacturers recommend that you change the oil between 6,000 and 10,000 miles. Always follow the car owner’s manual concerning how often you change your engine oil and the right type of oil for use, whether that’s synthetic mineral or semi-synthetic engine oil.
- Routine tune-ups: These include the following:
1. Replacing dirty or clogged air filters. A dirty or worn-out air filter will increase your car’s fuel consumption and result in your engine stalling due to lack of oxygen.
2. Power steering, antifreeze, transmission, and brake fluids are crucial to your vehicle’s performance and reliability. The mechanic will top off any low-level fluids if need be.
3. Car batteries can last for a decade with little maintenance. Battery inspection involves checking its condition and life and removing any buildup of battery acid.
4. The mechanic will also check your car’s belts and hoses. Any signs of cracking or splitting require immediate replacement before the belts can snap.
5. If you’ve been hearing an irritating screech every time it pours, you need to replace your windshield wipers. Plus, the mechanic will also top up your windshield wiper fluid for a sparkling windshield.
6. Your car’s undercarriage and axles will also be examined for any potential issues. Your wheels will also undergo alignment to avoid uneven wear and tear.
A weekend spent at the repair shop may not seem like much fun. However, it’s certainly time well invested. A tune-up avoids problems that may keep your vehicle out of the road for weeks and cost you thousands of dollars in auto repair financing. Generally, a professional tune-up can cost you anywhere between $75 and $150. Think of it as an investment in your car and coverage against future repair expenses.
Of course, wear and tear is an inevitable part of driving. But aggressive driving habits will cause your car parts to fail prematurely, requiring costly auto repair financing. Driving with care will give you the joy of driving more miles without repair.
Here are some of the best driving tips to use when you pull your car out of the dealer’s car yard:
- Practice slow and steady acceleration when you start your drive. This is because significant deterioration to the engine occurs within the first 20 minutes when you switch on your car and hit the gas pedal hard. Quick starts and sudden stops will also cost you more at the gas station, exert unwanted strain on your engine, and cause faster wear and tear on your brake pads.
- Avoid driving with little or no fuel at all. This is because the sediment from the gas, which usually settles at the bottom of your fuel tank, will affect the engine. The dirtiest segment of gasoline is at the bottom of the tank. So when this segment is used, there’s a higher threat that the dirt will ultimately end up in your fuel line and in the engine. Consequently, it may lead to grave damage and costly repairs.
- Your tires can last longer with careful driving. What you should do is observe recommended speed limits. Steer clear of potholes on the road. Also, don’t drive over curbs. Otherwise, they might take a huge toll on your tires.
- No need to take short trips. Instead, combine all of them. This is because a huge part of the wear and tear occurs during the first couple of minutes of driving. So fulfilling several errands at a go will keep your engine running efficiently.
Only Buy Gasoline at Reputable Gas Stations
Gasoline doesn’t come cheap, and you’re searching for ways to save money at the gas station. You’ve turned a blind eye to premium fuel. So you decide to fuel at an off-brand gas station to save a few bucks. But is the cheap gasoline safe for your engine?
Remember, not all gasoline is the same, despite the fact that it originates from the same source. As directed by the Environmental Protection Agency, several additives are combined with the base gas. The end product is safe for your engine and cuts on your overall emissions.
Various gas companies, including major brands and off-brands, add their own additives in the gasoline. This is designed to make the gas effectively clean and enhance engine performance. The major difference is that reputable brands add further additives in their fuel to give an extra level of protection and cleaning for your engine.
Of course, more additives come at a cost but guarantee excellent engine performance. In contrast, off-brands will sell you bare-bones fuel with fewer additives at a lower price.
Ideally, check your car’s owner’s manual to confirm the type of gas the manufacturer recommends. If possible, stick to that guideline.
Fuel expenses make car ownership an expensive affair. If you don’t know where to get the best fuel deals every time you need to refuel your tank, you’ll end up paying over the odds for gas.
Have you ever filled up your vehicle with gas only to drive a few minutes later and see cheaper gas at another filling station? There is no worse feeling than that. The good news is you can prevent such situations.
If you want to reduce your car fuel expenses, consider using gas price comparison apps. These apps help you compare all the gas prices in your location. Plus, you can even indicate your preferred type of fuel. If you want diesel fuel, only filling stations that offer diesel fuel will pop up in your search.
When browsing through the available list of filling stations near you, you will see the following:
- The price of gas.
- Last price update.
- The distance between you and the station.
- Customer reviews for that fueling station.
Thus, you can know where to get affordable gas immediately. Look at the money you’ll save. While a $1.50 difference in gas prices may not seem like much, it will add up over time. Besides helping you save money, you also save time since you don’t have to drive around searching for cheap gas.
Here are some examples of fantastic apps that will point you towards the cheapest gas to fill your tank with:
DIY Basic Car Repairs
Perhaps you’re one of those drivers who call their mechanic straight away when you experience a slight difficulty with your vehicle. Car repairs can drain your wallet fast. The good news is you can carry out various repairs on your own, irrespective of your technical skill. As long as you can hold a wrench, you can do a lot more, from fixing alternators to fuel filters.
For do-it-yourself repairs, a computer should be your resource tool. Expert Village and AutoMD are both fantastic resources of how-to guides, general-purpose videos, and diagnostic help for the most basic auto problems.
If you want to weigh up whether a repair merits your time and effort, RepairPal is a useful resource for verifying the average price of repairs in a repair shop. Thus, you can decide whether to do it yourself or take your car to the mechanic.
When doing the repair work, have the video guide loaded up in front of you. Follow the instructions and always refer back to the video guide if you missed a step.
Virtually all vehicles are fitted with nuts and bolts for the basic repairs you’ll need to make. When buying car repair tools, pick those with hefty handles. They usually provide a good grip.
Some of the typical tools you need include:
- Torque wrench.
- Adjustable wrench.
- Socket and ratchet set.
It’s late. You’re leaving the building after doing some errands, and there it is—a parking ticket nestled on your windshield.
According to a survey of data from over 100 U.S. cities, Americans pay between $25 and $200 on average for parking violations. Generally, parking tickets don’t affect your car insurance rates. However, they could result in further inconveniences, including:
- A tire boot: You may have a boot placed on your car’s tire until you pay for the tickets. Apart from paying up, you will also need to pay someone to take out the boot. This may cost you up to $136 in major cities like New York.
- Late charges: Unpaid parking tickets attract late charges, which can be costly. Some municipalities double the original ticket or more. You don’t want to accrue past-due fees on your ticket violations.
- Getting towed: Be ready to spend over the odds to have your car released when it’s towed for a series of parking tickets. In an expose run by NBC 7 in San Diego in 2019, they discovered that car owners paid between $2,700 and $5,000 to have their impounded cars released. Further, the municipality sold 1,452 out of the total 4,683 towed cars.
Below are some of the tips that you can use to avoid a parking ticket:
- Be careful where you park your car. Ideally, check nearby signs to confirm whether you’re permitted to park in the vicinity.
- If you’re parking in an area with time limits, take note of the duration you have paid to park. To do so, consider setting a timer on your phone in case you forget. You should also give yourself additional minutes to get back to your car before the period elapses. Or you can add a change to the parking meter to extend your parking time.
- Consider a scenario where you’ve parked in an area with a faulty parking meter. It may be quite difficult to prove to the local parking attendant that the meter was not working. The best thing is to park somewhere else if possible.
- Probably you’re a victim of regular parking ticket violations at home or adjacent to your workplace. The alternative is to rent a parking space instead of parking your car outside. You can also table a request to your employer for parking assistance. Another option is to park your car safely elsewhere and use public transportation to work or school.
The Bottom Line
Car ownership can sometimes feel like throwing money down the drain. One day it’s wear and tear on the brake pads and paying monthly premiums. Then later, the tires need replacing, or the engine has a problem.
It may often seem like your dishing out money to the gas station and mechanic. Ultimately, the fuel and auto repair financing may far outweigh the initial cost of buying the car, which isn’t a good piece of personal finance.
With that said, car ownership doesn’t have to feel like a drag. The above mentioned tips can help you significantly reduce the amounts of money you spend on your car.