Lower car insurance reduces staggering running costs

Posted :27-02-2006

The staggering cost of running a car has soared 56 per cent in the last 20 years to £511 a month.

According to research from Direct Line Loans, the rise in the average cost of running a car to over £500 a month has far outstripped increases in the average household income, and now accounts for just £68 per month less than a mortgage.

However, people are still attached to their cars as a mode of transport, with 78 per cent of Brits owning a car and £90 billion spent on running and maintaining them.

An additional 400,000 people are expected to buy a new car this March, although many will be paying over the odds.

Although drivers cannot avoid the cost of road tax and depreciation, there are several ways in which British drivers can reduce the expense of running a car.

Too few car owners are shopping around for car insurance, frequently taking the first deal they are offered. However, checking for car insurance online can be one of the easiest, as well as the most productive methods of saving money on car running costs.

This applies equally to car finance deals. David Allan, commercial director for Direct Line Driving for Less, said: "The most concerning aspect of the report is that of new car buyers this March, one in four will accept the often expensive car dealership’s financing schemes."

This is despite dealership finance deals being on average 3.4 to nine per cent more expensive than more competitive loan rates, costing drivers an average of £1,735.


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