by Tricia
When I ran the numbers for 2006, I was a bit surprised to see that our car cost over $2,000 to own. Granted, a big part of that went towards fuel ($649).
The accessories for the car ran $100. This amount includes the car registration costs as well as things like air fresheners. Also, for some reason I put driver’s license renewal fees in there. I expect that this expense will be less next year because our drivers licenses are good for a few more years. I also plan on letting the car stink if it stinks 😛 No more air fresheners for a while 🙂
We currently have breakdown insurance through AAA. That runs $48/year and at this time I am paid up through September of 2007. I will have to consider cutting this cost if our money situation isn’t better by then. But I think it will be.
Our fuel costs are fairly low. Our car is very fuel efficient (30-40 mpg) and I am thankful we ended up buying such a frugal car. Really, though, we won’t be using our car as much now with my husband not working. So, our fuel costs should go down overall.
Our insurance on the car took the biggest chunk. We currenly pay $99/month on a monthly payment plan. Our deductible for this full coverage plan is set at $500, but there is a clause where we do not pay the deductible if the accident is not our fault. I have called my insurance company to see about lowering my rates. My car is only worth around $5,000 now, so it seems like I should be able to get it lower.
If I raised my collision coverage deductible to $1,000, I would save $6.00/month. If I also raised the comprehensive coverage deductible to $1,000, I would save an additional $7.83/month. So I could save $13.83/month just by raising the deductibles to the highest I can go. That’s not a lot.
I then asked about taking off the collision and comprehensive coverage from the car. If I did that we would save $61/month. That was more like it. That would be a nice amount to save per month. But it has a price.
Since our car is still worth around $5,000, we would like to keep full coverage on it for now. With winter being here, our roads are now constantly snow-covered (except for a few main highways). It’s probably best to have the coverage right now. Once the snow melts in April or May, we will think about taking off the full coverage.
There is a little bit of money we can cut from here immediately. Longer term, there could be more if we cut the full coverage insurance and the AAA insurance. It seems ironic that we just obtained health insurance and now we’re thinking about getting rid of auto insurance. If it was up to me I’d keep all of the insurance to protect what we have.
Another option I have is to shop around for a different auto insurance policy. That’s hard to do because the company we have now has been great in terms of service and they were the best price around when our car was newer. It doesn’t hurt to shop around, though.
Next expense to review….FOOD.
Hi Tricia, the quickest ways to cut your car insurance are ( I posted about this on 2 nickels) :
1. Change payment cycle to quarterly or semi-annual. Most agencies charge a fee for the more frequent payment cycle.
2. With hubby’s job loss – call and make sure your annual expected mileage is in line. Less miles, cheaper insurance. I don’t know where you are at now, with costs so low, you may already be at the bottom.
3. I would raise the deductibles, but I would not rid myself of insurance. Your car is way to valuable to go away with an accident. I generally, use the $3k level, once car is under this amount we go only liability.
Don’t worry, it will all be good!
I know insurance varies widely by state, but the rate you are paying, $1,200 per year, for only 1 car sounds awfully high to me. Definitely shop around!
Are you a warehouse club member, like Costco or Sam’s Club? Go to their web site and get an auto insurance quote from them. 2 years ago I was shopping around and Costco quoted me $450 cheaper per year than any other company, and I got quotes from many companies, including those internet mult-company quote sites.
Since you have full coverage on your car, does it include breakdown insurance? Our policy does, which we only just found out about recently. They’ll bring us gas, change a tire, and take of of lock server & towing — exactly the same as AAA. So we dropped AAA, since it was duplicate coverage at 4 times the price. I wouldn’t drop both though if you can help it, especially if you have an older car. One tow could make up for it.
You can use a dryer sheet as a car air freshener. It works really well!
My car, a 2002 Acura TL, only costs me ~ $350 every 6 months (I don’t pay monthly). My wife and I are only 24/26 respectively. I live in a rural area in the midwest; your location (urban, rural) plays a large role in your car insurance. My rates dropped by about 1/2 when I moved from a midsized city to my current location.
Your rates sound a little high to me too. We pay $491 for 6 months with 2 cars and 2 drivers, full coverage. I was just telling my husband the other day that I feel old now that our rates are so low. When I first started driving at 16 I paid $100 a month just for me, 1 car, liability only. 🙂
Another idea for lowering your rates: do you have all your insurance with the same company? I get an 18% discount on my car insurance just because I also have my homeowners (gets me 15% discount) and umbrella policy (adds another 3% discount) through the same company.
I was looking at our car insurance earlier this week, too, since our 19 year-old son is now driving. It’s interesting – the biggest chunk of our bill is for liability protection. Raising our deductibles makes hardly any difference so we’re keeping them at fairly low levels. However, one of our coverages was for Personal Injury Protection, $2,500 limit per person, at $82.36 for 6 months. I’m going to drop that coverage as we can “self-insure” for that amount.
The Dollar Stretcher (www.stretcher.com) has a whole list of low-cost suggestions for keeping a car smelling fresh.
I envy you. We have 3 cars for 2 people. One is paid off, we’re working on another (paying $15k off in 8 months) and the third is a new Honda Ridgeline. Being in the DC area (Maryland to be exact), we pay about $2300 per year on 3 cars. The paid off one is liability and comprehensive only. That’s $190 per month
I’m going to go through and detail what we’re paying monthly and yearly on our cars and post it. I think I’ll be quite surprised at the final number.
I just switched my insurance over to esurance.com, and dropped my rate from #580 for 6 months to $330 for 6 months. They were far cheaper than anyone else I tried, but rates really do vary person to person. Definitely shop around!
Well between you, I and the brick wall Lowest Priced Insurance is always the Best . However it does pay to shop around and get numerous quotes. Try www.hasslefreeinsurance.net for multiple quotes before you commit to an insurance policy. It most definiteley will save you 50% on your insurance premiums.