Potential Pitfalls When Buying a Car - Insurance & Maintenance Costs
There are numerous factors to keep in mind when pricing out auto insurance. These factors could include your driving record, age, credit score, accident history, where you live, the length of your commute to work, weather patterns, etc. And, these variables will change depending upon each state’s insurance laws. But one variable that you may not have thought about is the make and model of your car.
According to insure.com, “Sports cars and high-end luxury vehicles are almost always much more expensive to insure because of repair costs. The finishes in these vehicles are usually high-end and much pricier than the materials used in more moderately priced vehicles."
According to the American Automobile Association’s (AAA) 2020 Driving Costs study, the cheapest car to insure was a small SUV, at an annual cost of $1,087, and the most expensive vehicle to insure was a small sedan, with an annual cost of $1,342.
You may be able to obtain discounts on auto insurance by asking about safe driver, safety/security equipment, student and paid-in-full discounts, which are commonly offered by most insurance companies.
The costs associated with maintaining your vehicle could also take you by surprise if you don’t do a bit of research before making your purchase decision. Reliability is an important consideration to keep in mind when you start shopping for a new vehicle, especially if you plan to keep it for a while.
JD Power released its US Vehicle Dependability Study in 2020 and identified nine vehicles with the fewest maintenance problems. It may be worthwhile to take a look at these results to help you decide between one make and model over another before you make your purchase decision.
In addition, with the increasing appeal of electric vehicles, Consumer Reports found that the overall maintenance costs associated with these vehicles is much lower than for vehicles that have gas-powered engines. And, as battery prices drop and technology improves, the gap between the maintenance costs for an electric vehicle vs. those with an internal combustion engine could become even more dramatic.
Resources:
Insure.com - https://www.insure.com/car-insurance/car-insurance-rates.html
Policygenius.com –
https://www.policygenius.com/auto-insurance/learn/how-much-is-car-insurance/
Bankrate -
https://www.bankrate.com/loans/auto-loans/9-cars-that-rarely-need-a-mechanic/
Better Energy -
https://www.betterenergy.org/blog/consumer-reports-study-finds-electric-vehicle-maintenance-costs-are-50-less-than-gas-powered-cars/
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