THE average Australian family can spend $22,000 a year on transport costs and the biggest commitment are the family cars. Left unchecked, the costs of running a car can be a financial nightmare.

But a little thought can save you thousands of dollars a year. When it comes to cars its about both the purchase and the on going maintenance.

Kochie covers purchase and running costs for savings.
Kochie covers purchase and running costs for savings.

THE PURCHASE

Understand your needs

The first step is to work out what you need from a car and a firm budget, including on road costs. Research different makes and models until you have a good feel for how much vehicles you're interested in cost, features to look for and good models or years to buy.

Hot tip: If you're buying second hand, aim for the newest car with the lowest km possible for your budget; you'll hopefully save on servicing down the track.

 

Be prepared

Before inspecting a vehicle, put together a list of questions to ask the seller.

Buying new? Make sure you ask about fuel economy, fixed price servicing and dealer warranties.

Buying second hand? Always check the car's service log, ownership history and whether it's been in a crash.

Hot tip: Don't just take the seller's word for it; check the car's registration details with your state transport authority. Cross check the engine number against the car's paperwork, and ask for a recent roadworthy certificate.

 

Be a smart buyer

If you're buying a car from a dealer (new or second hand), delaying your purchase to the end of the month, end of financial year or end of calendar year can lead to serious savings as sales staff try and meet bonus targets.

Never be afraid to negotiate; the headline price is for mugs. Make a reasonable offer, keep emotion out of it and walk away if you're not getting what you want.

Hot tip: Watch out for added extras such as leather trimmings … a few hundred bucks may not seem like much in the context of a car, but quickly adds up.

 

Get the best loan

If you're relying on finance to buy your car, it can be tempting to simply go with whatever the dealer is offering.

But understand what else is out there; other lenders may be offering a better deal.

Hot tip: Look for loans with low interest rates and shorter terms … even if the monthly repayment seems higher, you'll ultimately save on interest.

 

Insurance

At a bare minimum you'll need Compulsory Third Party (CTP), and if your car is new or valuable, you'll likely also need comprehensive cover to protect you against damage to your vehicle.

Hot tip: To keep your premiums down, it's best to have good security features on the car and park it securely at night. Maintaining a good driving record won't go astray either.

Think about cutting costs and you can drive away with a smile.
Think about cutting costs and you can drive away with a smile.

 

 

THE RUNNING COSTS

Cut petrol consumption

Get rid of excess weight from the car (no more sports equipment or half your wardrobe in the boot!), open your windows instead of using air conditioning which uses up to 10 per cent more fuel, drive smoothly as less revving is kinder on the engine and, eventually, your wallet.

Maintenance

Filling up at cheaper independent service stations, try and do basic maintenance yourself, make sure tyre pressure is checked regularly …. It all adds up.

Share the driving

Inquire as to whether there are colleagues/kids classmates that live in your area and offer to share journeys to work or kid pick-up. Maybe look at ditch a car altogether and using a combination of public transpot and a ride sharing with the likes of GoGet, Hertz 24/7 or DriveMyCar.

Discount vouchers

The big supermarket chains offer discount petrol vouchers for purchases over a certain amount. While it many only be 4-10 cents a litre, every bit helps.



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