Budget Busters: Save Money on Transportation (Automobiles)

As a reminder, I’m writing a 3 part series on budget busters.  Crown Financial Ministries defines budget busters as “areas that can result in financial disaster.”  In the introduction article, we identified the 3 largest spending areas of the budget as food, transportation and housing.  In this article, we’re going to look at 10 strategies for saving money and controlling spending for the transportation  category, or more specifically, automobiles.

I must say any and all spending on automobiles is frustrating for me.  If we’re not wrestling with high gas prices, something needs repair.  To be frank, automobiles are money traps, in my opinion.  Much of the time, we can’t live with them and we certainly can’t live without them!  Unless you live in a city with widespread public transportation, chances are you have a least one automobile in your family and perhaps two.

I’ve tried to think about how we can have one less car in our family, but given our particular situation, it just isn’t possible.  Therefore, we’ll continue to buy used and try to implement as many of the below money saving strategies as possible.  So, let’s look at some ways to save money or control spending for the transportation (automobile) category of your budget.

Buy used and resist the temptation to buy new

Certainly, you’ve heard or participated in the debate over used versus new.  The bottom line is buying used is the cheapest of all options per a study at Edmunds.com.  If you’re a money saving soldier, forget about leasing and never buy new.  Studies have proven that used is the cheapest option.  You can find plenty of used, nice, reliable and clean cars.

Don’t lease

To continue the strategy from above, leasing is the path to the most expensive car expense.  I recently wrote about leasing a car and have concluded this is not a wise money saving route to take.  If you’re interested in a monthly car payment (forever!) leasing is going to be for you.  But if you want flexibility, desire to someday pay cash for a car, and want to minimize your car expenses, you will avoid a lease like the plague.

Find a trusted mechanic

I’m car maintenance ignorant!  Okay, not so much as I know my car needs to have a regular oil change., but that’s about it.  :) But if you’re like me, I don’t have a clue when it comes to the technical details of car repair.  All I have going for me when speaking to a mechanic is my tolerance for the price tag of the repair.  My response to a high quote:  will it still run, for how long and is it safe?  Okay, so this is all the more reason to stay away from high priced dealership mechanics and find and build a relationship with a neighborhood mechanic you can trust.

Stay current on oil changes

As I said, I do know my cars need oil changes.  My dad has always told me, “if you do nothing else, make sure you get the oil changed.”  Personally, I don’t change the oil every 3000 miles as some quick services will suggest.  Rather, I change it every 4000-5000.  Write or wrong, I’m changing the oil (as I should) and saving money with less frequent changes.  I suppose it also depends on the purpose for the automobile.   I may choose to have the oil changed sooner than later if we’re going to be traveling out of town or making a long road trip.

Drive a car long after it’s paid off

So, interested in saving big bucks on transportation or automobiles?  By used (rule #1) and then drive it until the wheels fall off (rule #2).  Don’t drive a car when it’s unsafe, but you should drive it until its useful life ends.  I don’t think there is a hard and fast rule of when the useful life ends, but use good judgment.  It boils down to asking yourself whether or not you need a new used car.  As a side note, for big items and small items, ask the question often when considering a purchase.

Purchase high value automobiles

Consumer reports released there annual cars edition.  An article I particularly found interesting had to do with buying the car that provides the most value.  How is value defined?  The lowest purchase priced vehicle doesn’t always provide you the most value.  Essentially, you want to find a car that performs the best for the least amount of money.  One of my favorite cars for high value and moderate cost is the Honda Civic (that’s what I drive).  Check out the issue to learn more.

Don’t finance more than 4 years

If you’re in a situation in which you need to finance a car, certainly, try to find the best deal by shopping around.  CarMaxis a pretty good place to find no haggle reasonable prices on automobiles.  But whatever you do, avoid financing 5-6 years.  Agghh!  What might seem like a great deal at the time, certainly won’t feel like a great deal when you’re still making payments that long.  I’m a strong advocate of buying high value used cars at lower prices and eventually save up to pay cash for newer models.

Shop around for car insurance

Don’t automatically accept the first quote you receive.  Insurance rates differ between providers, so it pays to shop around.  You can also save money by bundling home and auto together.  But consider more than these tips.  My friend PT at ptmoney.com provides 20 tips for a more affordable auto insurance policy.

Consider dropping collision

I picked up an interesting tip from Crown Financial Ministries worth considering.  If you own a car more than 4-5 years old, you might consider dropping the collision coverage. Collision covers damage to your vehicle resulting from a collision with another vehicle or object.  If your car is older, chances are the additional coverage may not be worth paying, if the cost to fix the car is more than the car is actually worth.  Wisebread.com provides a good overview for making the best decision.

Improve your gas mileage by keeping your tires inflated properly

So, an old trick from my dad I try to follow is keeping my tires aired up a little bit more than the minimum.  Honestly, I can’t say whether or not this for sure improves my gas mileage and I’ve never measured the difference.  But, it’s one of those things that has been stressed by dad in the past and I’ve just tried to follow his wise advice.

I will also mention tire replacement can be quite expensive depending on the type of vehicle you drive.  It’s known that lower pressure in tires wears tires out faster.  So, in my mind, this is all the more reason to check your tires regularly and keep them a little bit above the minimum requirements.

Final thought

Probably the biggest way in my mind in avoiding large automobile expenses is to look at other opportunities for transportation such as using public transportation.  While this may not be an option for everyone, public transportation, if availble, can provide big money and time savers.

As I mentioned, I’m far from an automobile expert.  What do you think of these money making strategies and do you have any other ideas you can share to save money and control spending in this area?

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