As a student money is almost always tight (to say the least). Even if you work during the holidays or term time there are bills, nights out, gym membership, housing costs and more to worry about. With all of these expenses and little coming in, how do you pay for your car costs or at least keep them as low as possible?
The best way to avoid the panic that ensues when you have to pay an unexpected cost for your car (think emergency repairs) is to budget. If you can put away a bit of money each month into a separate pot, you’ll lessen the hit if an unexpected bill comes in.If you put away £15 a month as an emergency car fund, you’ll find that it quickly builds up. If you struggle to save, try an app like Moneybox. They offer a great ISA in an app and you’ll most likely make money by investing in their range of packages.
You may find that you don’t have any problems during the year and that money saved can go towards a new car, a holiday or paying off other bills!
More good news; young driver insurance is expensive. Most drivers are tempted to put their excess right up to cover to keep their insurance costs down. I can tell you first hand though, that even if you don’t think you’ll be claiming on your insurance because you’re a good driver, you can’t account for others on the roads. A month ago my car was hit pretty badly when it was parked outside the house, now I have an excess bill of £500. Of course, I’m wishing I put my excess lower now so do bare it in mind when you are insurance shopping. There are a number of companies that look at young driver insurance, so do some shopping around and get a quote from some of them.
Caution when buying a car
It’s super important to look out for a number of costly areas when buying a car. Ideally you want a car with a long MOT, road tax and good tyres. If you get a car and it needs new tyres (which by the way are expensive) you’ll be hit with another bill, not long after forking out for the car itself.
Same goes with the MOT and road tax; it’s likely the car dealer will build this into the cost of the car when they sell it, but it’s still likely to be cheaper than buying a car and then paying for a new MOT and road tax.
Help I didn’t do any of the above!
If you haven’t saved any money and you are now facing an unexpected bill for your car, you’ll need to get something sorted out quick. What are the options? You could speak to your bank about extending your overdraft. You can go to the bank of Mum and Dad. Or you can have a look at Smart Pig, they offer short term student loans and cap the amount of interest they charge at 50% of the loan amount, which is a lot cheaper than Payday lenders.
Tired of having no money?
University is a big investment and it will reap rewards in the future if you focus on your career. Short term pain for long term gain.