Car
Ownership Costs
A
basic understanding of your car ownership costs can literally save you
thousands of dollars over the life of your car.
Studying car
reviews, patiently shopping all of the car dealerships you can are
really only just the beginning of the big picture when it comes to
car ownership, and really only get you part way to obtaining the holy
grail of negotiating a car deal.
Getting a
good grasp on the cost of ownership of a particular vehicle is
monumentally important.
Why work your behind off negotiating the
greatest car deal of the century and then pay grossly for that
vehicle for the next several years...... if you do, your great car
deal that you negotiated earlier will lose its shine (and your
money) in a big way.
Whether the
car you purchase is a good value or poor value is difficult to
determine until you factor in such automobile ownership costs such
as:
- vehicle
depreciation
- cost to
insure the car
- cost of
financing the car
- vehicle
maintenance
- repairs,
and more
Consider
this; a higher priced car that holds its value for a longer period
of time may actually be a better buy when compared to a lower priced
car whose value plummets the second the engine is turned over. The
point is you can't determine the overall value of the car unless you
take the time to analyze all the ownership costs attached to the
car.
Automobile
cost of ownership can basically be broken down into two types of
expenses: fixed and variable.
Fixed Car
Ownership Costs -
Examples of fixed car costs would be depreciation,
insurance, financing, and annual government fees such as tags,
inspections, etc. One aspect of fixed vehicle costs is they usually
decrease over time and some will be completely eliminated once you
pay off the loan.
Variable
Car Ownership Costs -
are simply those automobile ownership expenses you incur as you
use your car on a daily basis. And for the purposes of our
discussion in this website, we will focus primarily on the fixed
costs of vehicle ownership since these relate more directly to
factors involved in the actual purchasing of the car.
For sure,
these variable costs of car ownership should not be overlooked when
you are doing your research on a particular car. These car
ownership costs such as
fuel economy, the model's track record on maintenance and repairs,
should be given their proper weight in the decision making process.
Next
Car Depreciation
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