Buying a new car means you’ll need to make lots of decisions, from the make, model and engine size to practical features like boot space and the number of seats. In truth, it can all be a bit overwhelming. So, to help you choose a car that’s right for you, and with tips on how to get cheap car insurance, here’s advice from the comparison site, mustard.co.uk.
Set yourself a budget
Setting yourself a realistic budget doesn’t mean limiting your choices, but it might mean opting for a used or nearly new car rather than a brand-new one. Buying nearly new can help your money go further, enabling you to choose a higher specification car.
But if you’ve set your heart on a brand-new car, buying at the end of the quarter could help you snag a better deal as dealerships try to reach sales targets. You could also save a little by choosing a previous model when new registrations are released. However, bear in mind that brand-new cars lose considerable value in their first three years, up to 60% in some cases.
Work out what type of car you need
Unless you’re lucky enough to have an unlimited budget, it’s a good idea to prioritise important features, for example:
- Comfort – if you spend a lot of time driving, creature comforts like heated seats and adjustable lumbar support might be high on your list.
- Engine size – if you cover lots of miles on the motorway, you may prefer a car with a larger engine and greater acceleration.
- Rear seat space – consider if there’s enough room for baby and child seats.
- Boot capacity – if you travel with lots of equipment or need to fit in pushchairs and groceries, check the boot is big enough for what you need.
- Internal fixtures – consider what are the most important features for you, whether that’s DVD players in the headrests, lots of cubby holes for storage or an infotainment system with the latest technology.
Calculate car running costs
As well as budgeting for the initial cost of the car, think about long-term expenses too, including car tax (vehicle excise duty), which is calculated according to CO2 emissions. You can find a list of prices at GOV.UK.
Car cover is another big expense but knowing the car’s insurance group number can help you budget. There are 50 groups in total, the higher the number, the higher premiums are likely to be. As a general rule, more expensive and powerful cars are in high insurance groups and as a result, cost more to insure.
Don’t forget to consider car servicing costs too, which can help identify potential problems early on when they’re likely to cost less to repair. Dealerships sometimes offer servicing programmes for a set cost which can help you budget.
If the car is three years old or more, you’ll also need to factor in annual MOT costs. However, this price is set by the government so you shouldn’t pay any more than £54.85* for a car.
Consider your finance options
If you’re buying from a car dealer, you’ll usually be given the option of spreading the cost of the car, for example through:
- Hire purchase (HP) – you’ll pay a deposit and pay for the car in fixed monthly instalments over an agreed length of time. When the contract ends, you’ll own the car outright.
- Personal contract purchase (PCP) – this is similar to HP in that you’ll pay a deposit and make fixed monthly payments over an agreed period. But at the end of that period, you can make a large, final payment to own the car, use its value to part-exchange it, or you can simply walk away.
Alternatively, you could take out a personal loan from a bank or use your credit card to pay for the car (credit limit allowing).
The golden rule of all loan and credit agreements is to ensure you meet your monthly repayments. If you don’t, the lender could take your car away, and it’s highly likely to negatively affect your credit score.
How to get cheap car insurance for your new car
A number of factors affect the cost of insurance, including some that are out of your control, such as your age, address, and claims history. Nevertheless, there are still lots of ways to keep premiums as low as possible, including:
- Paying for your policy in one go
- Increasing your excess
- Improving your car’s security
- Adding a more experienced named driver
- Opting for a telematics policy
The good news is that if you want to find out how much car cover might cost you before you make a decision, you can search for quotes online at sites like mustard.co.uk. You can also speak to a friendly, expert advisor on 0330 022 8825.
*Price correct as of 10/01/23 https://www.gov.uk/getting-an-mot/mot-test-fees