Whether it be
second hand or new buying your first car does not have
to be as daunting or painful as it may at first seem.
Here we tell you what you need to know and how buying
a new car works.
There are 7 things to consider when buying your new car:
have set figure in your head of how much you can afford
cash, or how much you can afford on Finance. This is fine but
make sure you have considered all the other financial aspects
of having a car e.g. road Tax, Insurance. Getting the money
together to buy that all important, first set of wheels is really
only the first hurdle. Young drivers can often find that the
cost of insurance is as much as the purchase price of the car.
for this is simple - young drivers are a bad insurance risk.
Close to 4,000 car drivers, under the age of 25, were killed
or seriously injured in road accidents in 1997 - the most recent
figures provided by the Department of Transport. Of these 2,790
were males and 1,154 were females. In total there were 14,876
fatalities or series injuries which means that the young account
for 26.5% of the total.
of insurance is likely to come as a shock most young drivers.
Admiral Insurance, a specialist in the younger drivers market,
would charge a 17 year old male, living in a medium risk area,
wanting to insure a 1998 Ford Fiesta 1.25 LX, on a fully comprehensive
basis, £1,595. A female would have to pay £930.
a high performance car such as a 1992 Volkswagen Golf GTI would
cost significantly more. A 17 year old male would have to pay
£2,592 and a female would be charged £1,551. At 20, the premium
falls significantly. A 20 year old man wanting to insure the
Fiesta would have to pay £535, assuming two years no claims
bonus, and the equivalent female, £419. The Golf driver, at
age 20 would have to find £823 and a female, £644.
24, again assuming two years no-claims bonus, the premium has
fallen still further. A male Ford Fiesta driver would have to
pay £354 and his female counterpart £328. The premium on the
Golf comes down to £447 for a man and £437 for a woman.
Line would charge a 17 year old male wanting to insure, fully
comprehensively, a J registered Fiat Panda £699.92 and a female
£564.72. If the same two drivers wanted to insure a VW Golf
1600 the premiums would be £1,250.08 and £1,008.80 respectively.
and sex, the model and size of car are the most important factors.
Miranda Seymour, public relations manager at Direct Line said:
"A big engine and a young driver are not a good combination.
May, communications officer at Admiral said: "It might be a
good idea for young newly qualified drivers to go for a smaller
car for the first few years until they have built up some no
claims bonus Once they have a good driving record, they will
find it much cheaper to insure their ideal car."
No claims bonuses make a huge
difference to premiums. After one year of claim-free driving,
Direct Line, for example, offers policyholders a 30 per cent
discount. This increases by 10 per cent each year until by year
four, drivers are getting a 60 per cent discount. In year five,
policyholders qualify for the maximum discount of 65 per cent.
added: "Young drivers also need to go to the right insurer.
Some insurers do not want to be involved in this market and
therefore would not offer competitive quotes." Admiral and Privilege,
an associate of Direct Line which specialises in non standard
insurance, are two companies that operate in this market.
Insuring third party is an option
but obviously if you have an accident and your car is damaged,
you will have to pay for repairs out of your own pocket. The
premium for a 17 year old male with Admiral drops to £1,269
for the Ford Fiesta (compared to £1,595 fully comprehensive)
and to £2,115 for the Golf (compared to £2,592).
the Pass Plus examination can also help reduce premiums. This
is a government backed scheme which aims to help newly qualified
drivers to be safer and better drivers. The aim is to give experience
of difficult driving conditions and the course covers both night
and motorway driving.
Insurance gives the equivalent of an extra year's no claims
bonus to drivers who have sat the test.
direct insurers, such as Direct Line have been hugely successful
since their launch. Direct Line has become the largest private
motor insurer in the country with some 2 million policyholders
and even rivals admit that it has set the standards that the
rest of the industry has to follow.
It is probably
worth telephoning four or five direct insurers for a quote as
well as a broker or two. However, you do need to think about
whether cost is the only factor to take into account. Policies
and the levels of service offered vary considerably, so look
at the excesses on them. Some policies offer perks such as a
courtesy car while yours is off the road being repaired or cheaper
is not the only cost a young driver has to consider. There is
also the additional costs of running a car, not to mention petrol,
oil, tyres servicing and repairs.
Road Tax - £150. (As announced
in the Budget, owners of cars with engine sizes below 1100cc
will pay annual car tax of £100 from June, instead of
the new standard rate of £155.)
Insurance - variable
Breakdown insurance - AA cover - £41-£126 single membership,
depending on level of cover £64-152 joint, depending on level
of cover £90-£181 family, depending on level of cover.
MOT - £30.87 (government recommended maximum)
Once you have
found a car you can afford find out what the car is really
worth, or get a review on it.
- Where you buy it: Whether it be a second
hand car or new options on where to buy a car from are
as great as they have ever been. It is not the case
anymore that a new car has to be bought from a UK dealership.
Buying abroad is as easy as ever. Second hand cars can
now be bought "off the shelf" from large car
supermarkets. It is all about getting a good deal. Here
are some sites to worth looking at.
- Making sure the car is value for money: if
it is a second hand car you are buying it is important
to have the vehicle checked before you buy. There are
some checks you can do your self such as exhaust fumes
colour, a blue/grey exhaust shows a healthy car.
- Check the identity: Make sure your car
to se has no any hidden history.