Automobiles: Vehicle Maintenance costs
Your monthly car payment is just ONE of the costs to car ownership than just. If your insurance is $2400 annually, (if you can pay it off monthly) your monthly obligation is $200. Insurance rates can be surprisingly high for "hot" new cars because they either tend to attract younger (higher-risk) drivers or are also more likely to be stolen or vandalized. New car models may also have unforeseen reliability and collision safety issues, which can impact insurance costs in subsequent years, once the history becomes known.
Your monthly gas bill can be $60 to $200 depending on your commuting distance. Be careful using the posted "average" city/highway kilometres per litre, because they are idealized "estimates." If you commute to a downtown job, you will have parking costs to contend with (or the occasional parking ticket).
Your tires may need replacing once a year, at $200 per tire or $800 annually, plus installation and a wheel alignment. Don't forget the twice a year oil changes, and one "ambush" car repair every year (which you probably wouldn't have if you bought a new car under warranty).
Consider membership in an automobile club (usually a Canadian Automobile Association affiliate), if only for the towing and battery "boosting".
Add those together to estimate your average monthly expense, and add it to your car payments to assess your affordability and budget. If you get a cheaper car, you might save on payments, but the insurance stays about the same (the bigger risk is damage to other cars and people, not to you). It's important to leave room in your budget for all these costs, and those with poor credit should build a reserve in your bank account for repairs, or you will find yourself without the use of your car, but still making payments on it.
|
