Categories: Cars

4 Financial Questions To Ask Before Upgrading Your Car

Many car owners start the process to upgrade their vehicles without thinking enough about the impact this type of change can have on their monthly and total finances. When you upgrade your car, you usually must deal with higher expenses related to it. While you look for a new vehicle, keep the following questions in mind:

What Are My Financing Options?

Although most dealers offer financing options, you can expect to cross paths with some that refuse to offer budget-friendly ones. They keep the installment amounts at a certain level to weed out buyers/borrowers who might not have the best credit or enough money to keep up with regular payments. Many private sellers don’t offer payment options at all. They often want upfront cash because payments are too much of a hassle. They’re also usually trying to make a quick buck.

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Will my Gas Mileage Improve?

It’s easy for drivers to have a false sense of fuel-related costs because they’re so used to the costs associated with their current vehicles. A new or gently used vehicle might not provide you with as many miles per gallon of gasoline. Even if you’re told the vehicle is capable of so many miles per gallon, always consider that different vehicle models burn through fuel at different rates. As a result, your current vehicle might not use a lot of gas in start/stop city traffic scenario, for example, but a new one might burn through a lot of fuel. Additionally, remember that you still have “fuel” costs in the form of a paid charging station or home electric bill if you pick a hybrid or electric option.

What Are Maintenance Costs?

Mechanics often charge more to perform tune-ups and repairs on luxury and certain foreign cars. Always confirm that parts are readily available and inexpensive before buying or leasing a vehicle. You also need to make certain that the design of the vehicle won’t cost you more in the long run. For example, you might find out that the car you’re considering is designed in a way that makes it difficult for mechanics to disassemble it to conduct common repairs. When mechanics have to work longer to repair and replace parts, you pay more for their time.

What are my Total Expenses?

Beyond any regular weekly or monthly cleaning costs, you might spend money on professional auto detailing now and then. If you live, work or travel in a cold region, you might also need to use a car wash often to clean the underside of the vehicle regularly to prevent road rock salt and ice melt from rusting out the exhaust system and body. Also, don’t forget to speak with your insurer about auto insurance. An insurance carrier might require that you take out higher, costly coverage that increases your monthly insurance premium. Some vehicles have higher costs associated with them because of repairs or accident risk potential. On some cases your insurance may be lowered because the car is safer. This isn’t a negative, but a cost you should consider when budgeting for a brand new car. Of course, if you go with an eco-friendly vehicle, you might also receive a substantial premium discount.

As you can see, a vehicle upgrade involves both upfront and additional expenses. You must take the time to think about and estimate these potential costs before upgrading to a new or new-to-you vehicle. Otherwise, you might find yourself suddenly stuck with a car that you can’t actually afford.

Lizzie W: Lizzie Weakley is a freelance writer from Columbus, Ohio. In her free time, she enjoys the outdoors and walks in the park with her three-year-old husky, Snowball. You can find her on Twitter @LizzieWeakley.

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