Before you purchase a new vehicle or look at obtaining online car finance it's good to have a rough idea of the extra costs involved with owning a car so you can plan ahead and budget accordingly. If you're wondering what these costs are, then don't worry. We have you covered. In this blog post, we'll run through all things related to owning a car – from maintenance costs, to fuel expense, insurance and registration fees.
Registration costs
In order for a car to be legally driven in Australia, it must be registered. Registration is an important cost that spans the entire lifetime of owning your vehicle. The cost of registration varies depending on the location and type of vehicle you own, but registrants are typically paying less in regional cities than they are in major Australian cities. The average weekly cost for households in regional cities is less than $28.00, while the average weekly cost for households in major cities is more than $29.00.
Fuel
Cars need petrol or electricity to run and this is an ongoing cost you'll be faced with when you buy a car. The amount of fuel you use will depend on how much you drive, but also on the car's make and model. To save money on petrol, invest in a car with higher fuel efficiency.
Though the initial cost of buying an electric vehicle (EV) can be high, with an average weekly cost of $11.70 to recharge, EVs are cheaper than petrol or diesel vehicles in the long run. By contrast, the weekly average fuel cost of a medium SUV is $28.37.
Stamp duty
When you buy a new vehicle, you have to pay stamp duty, which is the tax that state and territory governments charge for certain documents and transactions, including motor vehicle registration and transfers. The amount of stamp duty tax you will need to pay varies depending on what Australian state or territory you live in.
Services & repairs
Proper car maintenance is crucial for the success of your vehicle. While the interval at which you get your vehicle serviced varies based on many factors, one thing most people agree on is that it should be done at least once every year or after 15,000 kilometres (whichever comes first). Your car service should include oil changes, tune-ups, brake checks, exhaust fans and other elements with the average cost of a car service in Australia between $150 to $550.
Insurance
Compulsory Third Party (CTP) insurance is mandatory by law and compensates injured parties in the event of a car accident. In Victoria, Tasmania, South Australia, Western Australia, the Northern Territory and the Australian Capital Territory, CTP insurance is included in your vehicle registration. In Queensland and New South Wales, you must purchase CTP insurance separately from your registration.
You can also purchase ‘third party’ insurance - which covers damage caused to someone else's vehicle or property if you're liable for it. Alternatively, you can buy 'comprehensive car insurance' that covers damage to your own vehicle as well as theft, fire and malicious damage. It's very important to make sure that you have your car insurance in place before you first drive away!
If you choose to finance your vehicle with a loan, the majority of car finance lenders require you to organise comprehensive car insurance before it can be settled.
Summing Up
Ensure that when you are shopping for a new vehicle that you take into account these additional costs to ensure you don’t spend more than you can afford and keep your budget on track.
