What your car really costs
THOUSANDS of dollars in savings can be made by ditching your car loan and ride-sharing, new research from finder.com.au has revealed.
The comparison website analysed cars purchased with loans worth $30,000, $20,000 and $10,000 and crunched the numbers to find out how much people could save by getting rid of them and using ride sharing services like Uber and GoGet.
The study revealed a 2014 Mazda CX-5 worth $30,000 would run up costs of $10,617 a year, made up of loan payments, fuel, insurance, registration and ser vicing. Meanwhile, ridesharing would set the same user back $5928, based on two Uber trips of 10km per week and eight hours of driving (car sharing service) GoGet. That works out to be a saving of $4689 per year.
A 2014 Toyota Corolla worth $20,000 would cost $7603 a year; $1675 more than ridesharing.
Finder spokeswoman Bessie Hassan said the rise of inexpensive travel options made car ownership less attractive.
“If you purchase a vehicle greater than $20,000 it can make financial sense to sell,” Ms Hassan said. “The cost of car ownership doesn’t stop at upfront or on-road – there’s licensing, stamp duty and garaging- and that’s not accounting for any surprise prangs or insurance excess.”
But unless you have a car worth $20,000 or more, don’t rush to ditch, as the study did also find a $10,000 car is actually cheaper to own and run than the ridesharing option by an average $660 a year.
Money wasn’t the only thing on Michael Beattie’s mind when he decided to sell his car in February. Working as a client services manager with the Mental Health Recovery Institute, the 32-year-old wanted to practise what he preached, live in the moment and arrive at work less stressed. The financial benefit was an added bonus.
“Where I live, parking is horrible at the best of times and I hated sitting in traffic,” Mr Beattie said. “I started catching the bus and the car was just sitting around.”
The bus to work gave Mr Beattie a head start on his working day, time to do online grocery shopping and savings of $20 a day in city parking, a factor not considered in the Finder research. “I sold the car just before rego was due also, so that was more than $1000 immediately,” he said.