Used cars on average cost over $26,000, as of last month. The average annual income of a college student making $18 an hour is $36,759. All things considered, Gen Z cannot comfortably afford their first cars, according to NPR.
Since it’s tax season, many people are planning on making large purchases, including used vehicles, with their refunds. While the numbers look big, it is entirely possible to get wheels on a budget without compromising much.
When it comes to car ownership, expenses will always be there. Whether it’s fuel, car insurance or the usual maintenance, one can expect to shell out some kind of money on an annual basis after becoming car owners. The best way to minimize these annual costs is to effectively budget.
San Jose State University student, Ramzi Shaban, currently owns a 2009 Toyota Corolla. The 20-year-old had positive sentiments regarding owning the car, which cost him $2,500.
“It gets me places and hasn’t given me any issues,” he said. When talking about costs, he expressed, “Even with the gas being expensive right now, it’s still cheap. It’s never broken down on me since I bought it a few years ago.”
Currently shopping for a new car is 21-year old Chabot College student, Cristian Perez.
“My main concern right now is the sticker price of these used cars,” Perez said. With an inflated used car market, it’s reasonable to hesitate with buying a car. “I don’t want to drop so much money right away,” he said.
Arguably the most important factor to shopping for automobiles is the actual car’s cost. While it’s everyone’s dream to have a nice car with the most up to date features, these aspirations come with a price.
According to RepairPal, the average annual maintenance cost of BMW ownership is $968. This means one can expect to spend nearly $1,000 a year on things like oil changes and other routine services. In the case of Toyota ownership, the yearly cost is $441. While Toyota doesn’t make the luxurious ultimate driving machine like BMW, there’s a clear winner in affordability.
The best cars for young drivers are the cars with lower cost of ownership. These cars are not going to be powerful or luxurious for the most part, but they will make sure that pockets aren’t so empty. RepairPal offers a tool which allows users to compare cars by reliability and cost.
Car insurance costs are already high for drivers under age 25 due to statistics regarding teen accidents. Because of this, it’s important to have a car that is cheaper so that the insurance premium is lower. If the annual cost is lower, then the insurance rates are more affordable.
According to GetJerry, the best car brands to consider buying from are Lexus, Toyota, Acura, Nissan and Honda. These brands are considered the most affordable and reliable cars on the market. It is possible to find these cars for under $10,000 on websites like Autotrader, where many private sellers list their used cars locally. Car dealers are another option for those who prefer flexibility with financing.
It’s clear that buying a first car is something that can be successful given the right circumstances. The best case scenario is being able to find a car with a lower ownership cost as well as a decent price point.