5 ways to save money when you have a car

On the Road 3 min read

Make smarter financial decisions related to your vehicle

Whether you trade-in every few years or prefer to drive the wheels off your cars, you can do a number of things to save money, sidestep an unexpected hit to the wallet, and increase your car’s long-term value by thousands. Here are just a few.

1. Buy the recommended grade of gas

While some older or high-performance cars do benefit from higher octane gasoline, most passenger cars on the road today run just fine on regular gas (87 octane).

The U.S. Federal Trade Commission advises car owners simply to follow the fuel recommendation in their car’s manual. With a 30 – 40 cent per gallon difference, “overbuying” can cost a car owner hundreds a year—with no benefit.

2. Keep up with maintenance

It might be tempting to stretch or delay your routine maintenance. But, in the long run, getting maintenance done in a timely way—fluids, filters, belts, hoses, etc.—can save your wallet from a big hit. A blown engine or trashed transmission caused by neglect can cost a car owner thousands of dollars in repair costs. Even something as simple as a clean air filter and properly-inflated tires can help your car run more efficiently, saving you money at the pump.

Keeping up with your car’s maintenance schedule can help enhance the resale value of your car, as well. Kelly’s Blue Book estimates that good maintenance can translate into a $1,000 difference in a car’s value.

3. Avoid smoking in your car

Cigarettes burn a hole in your car’s resale value. Anecdotally, many car buyers say the odor is a complete turn off—they’ll simply pass on a vehicle that smells like smoke. Meanwhile, owners of smoke-free cars can demand a premium when it’s time to sell or trade. A 2008 study by San Diego State University showed that smoke-free used cars were priced 7 – 9 percent higher than those spoiled by smoke.

4. Understand your service provider options

Many car owners swear by the dealership’s service department—especially when the vehicle’s still under warranty. But using a reliable independent shop might be a thriftier way to go. According to a 2010 study by AutoMD, drivers who used independent shops for service spent an average of $300 per year less than those who used dealerships.

In choosing an independent, make sure it’s made the investment in training and equipment needed to provide expert service for your vehicle. And know that through the 1975 Magnuson-Moss Warranty Act, the law is on your side if you do have to come back to the dealership for warranty work (in other words, going to an independent shop for routine service will not void the warranty if the work’s done right).

There are pros and cons to either choice. Whatever you decide, always look for shops with an ASE certification, and use services like Angie’s List to find ones with a good reputation. Finally, check out our Perkshare Program work through nationally-known independent service providers.

5. Don’t settle for cheap car insurance

Cheap car insurance” may be cheap because it’s stripped down to the bare minimum allowed by law. Sure, you’ll save now. But it may not be anywhere near enough to cover your liability if you’re responsible for an accident, or be enough to repair or replace your car if it’s damaged or stolen. Either means you’re paying thousands (or more) out of your pocket if you have an insurance claim—easily more than the money you saved in the first place by buying that cheap car insurance.

So, instead of looking for cheap car insurance, look for value. Figure out the coverage you need (and it’s true that older cars may need less coverage than newer ones). Then shop around, comparing “apples to apples.” Progressive offers tools like Coverage Checker and comparison rates to make this easier. Or, just contact an independent agent. Either way, you get the coverage you need at a price you want.

For most drivers, a car represents a significant financial investment. Make sure you’re maximizing yours by making solid short-term and long-term ownership decisions.

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