Consider Car Insurance Costs When Purchasing a Car
When choosing a car, you should be mindful that some cars cost more to insure than others. And in some cases, a lot more. So when you buy a car, factor in the cost of car insurance (as well as fuel economy).
You can pick up old cars very cheap, even ones that are still in fairly good condition. Lets say you pick up a 1996 model Nissan Skyline for $10,000. The fact that the car is 13 years old means it will add to the premium. Also a Skyline is a performance enhanced car, again adding to the premium. Now, also on the market that you might be interested in is a 2004 model Mazda 3, going for $15,000. The car insurance premium for the Skyline is a whopping $1,600 per year, whilst the newer Mazda 3 picks up a relatively cheap car insurance tag of just $600. After just 5 years, the ‘cost’ (principle plus yearly payments) of the Skyline catches up to the Mazda, and every year after that it will be costing $1,000 more!
The moral of the story is: be aware that the cost of a car is not just the sum you pay up front – but also the yearly expenses associated with owning a car, such as insurance and petrol. Before you buy a car, be aware of the factors that make up cheap car insurance, so if yearly insurance payments are going to be a financial burder, you can choose a car that will minimize these payments.
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