Americans love automobiles. More than 98% of American households currently own at least one car. With millions of vehicles sold each year, the car industry is huge. For commuting, Americans prefer to have their own car rather than use public transport. Despite that, owning a car is not as easy as you might think. Cars are not a one-time investment. You can't just buy a car and expect it to run without spending some extra money.
All cars need to run on fuel (or electricity), and that will consume your money. Also, cars need to go through regular maintenance. Even if you go through regular maintenance; sometimes, your car can break down and you would definitely need to invest some time and money on getting it fixed. So, you can find the car's reliability reports and research about its maintenance cost on CarIndigo.
In this article, we are going to talk about a few ways in which you try to save on your car repair bills; or, you can learn how to cope up with sudden repairs and what you can do to prevent such things from happening. There was a recent survey that found that people in the US spend an average of $2,000 on car maintenance and repairs in the last five years. The millennials and generation Z were the ones who had to spend the most bucks out of their own pockets.
The Harris Poll conducted an Ally Financial survey in 2019. From that poll, we come to know that people above 55 years old spend about $1,654 for vehicle maintenance and repairs. Meanwhile, millennials and generation Z had to spend $2,334 for the same. So, if you are young, you are more likely to spend more money on your car repairs.
This survey also found out from the Federal Reserve, that on average, 4 out of 10 adults wouldn't be able to cover the expenses of $400 without going into debt, or trying to sell something to make up for the money they lack. We have some tips ready for you that we would like to share. These should let you know the things you need to do and how you can save money.
- Save money
The best way to save money for unexpected situations is when you set up an emergency fund. Yes, an emergency savings fund can not only offer you relief in times of distress, but it can also be helpful to get your car repaired. The Ally Survey also found out that nearly two-thirds of 18 to 24-year olds have not set up any sort of emergency savings fund. On the other hand, half of all other adults have established an emergency savings fund.
You can choose to save as little as you want each month. Over time, the money will add up and you would be left with potentially a big amount of money that could save you in such a dire situation. Car repairs are not expensive. Consider setting up the fund. That way, you won't lose any money since you won't be able to spend it. If a situation comes when your car needs a major repair, the money will come to the rescue.
- Stay protected
Vehicles have warranties. All vehicles come with warranties. Some cars offer more warranty, while some offer less. Some offer scheduled maintenance, while others offer none. It really depends on the manufacturer you are purchasing it from. Make sure to check the warranty schemes. Some automakers also offer an extended warranty scheme for some extra money. Consider getting that.
On average, a carmaker offers 3 years of warranty. From a 2020 survey from Germain cars, across all makes and models, the length of average ownership of a car in the US is around 8.4 years. So, you are covered under warranty for the first 3 years or so, but what are you going to do about the rest? This is why depending on a car's warranty is too thin of ice to walk on. Some automakers offer 5 years of warranty, which effectively covers more than half the lifetime of the ownership of the car, but it still is not enough.
This is why you can consider getting a Vehicle Service Contract (VSC). It is quite similar to an extended warranty, as we mentioned above. This is basically a protection plan that will cover the vehicle's repair costs outside of the carmaker's warranty. This might be easygoing on you if something suddenly happens to your car and you are forced to shell out a lot of cash. The Ally survey also conducted a survey regarding this, and they found that merely 21% of Americans have opted for this in the last 5 years.
However, before jumping on this, make sure to do your research. Do a thorough check of the service. Also, stick with a reputed company. Make sure their services are available at locations near you. You would also need to check the contract and read between the lines to make sure that there is no hidden clause adverse to you. These contracts are mostly ignored because you are paying for something you might not even know might occur. You might need the coverage, or you might not. But it is always the best practice to get one service contract since life is unpredictable and we never know what lies ahead of us.
- Be proactive
While getting your car serviced or repaired, instead of leaving everything up to the hands of the mechanics, you can stay and check what work is being done. This is not for you to learn how to do it, but to make sure that the mechanic is performing his job well. Make sure he is not distracted and does not mess around with your car.
Other than that, you must also monitor your car after a certain period of time. You must change the engine oil according to the manufacturer's suggestion. You must also change your brake pads and rotate your tires after a certain distance has been traveled by the vehicle (typically, around 5,000 miles).
You must also check the fluid levels, the coolant level, etc. If there is something with your car, such as the check engine light is on, make sure to immediately take it to the mechanic to get it fixed. Always be sure to check the owner's manual to know everything and how to properly maintain your car for its lifetime.
The President of Insurance at Ally Financial, Mark Manzo states, "Unfortunately, too many Americans are just one repair bill away from being forced to make tough financial decisions. But proactive strategies can offer peace of mind and protect your wallet."
