One of the most important aspects to keep in mind when buying a car is your budget and how much you can afford to spend.

Whether you’re heading to Lamborghini dealers or a Honda showroom, it’s imperative that you know how much money you have available to spend on the car that you want.

If you are looking to set a budget for your new car purchase, remember that it isn’t just the initial cost of the car that you have to factor in and these 5 points should all be thought of when setting your budget.

1. Tax – the way that vehicle tax is calculated changed on 1 April 2010, with the most notable difference being that vehicle tax now costs more for new cars for their first year’s worth of tax. No prescription cialis

For example, if you went to Lamborghini dealers and purchased a brand new Murcielago LP640, which falls into the band M vehicle tax as it produces over 225 g/km in CO2 emissions, the first year tax rate would be 950 pounds.

This figure does decrease after the first year (to 425 pounds), but it’s worthwhile keeping in mind that vehicle tax on new cars in particular can mean you need a bigger budget than you might have initially thought.

2. Fuel – buy a small car, such as a Smart ForTwo and you’re fuel costs will be minimal, as the ForTwo is one of the most economical cars on the market. Buy a car that isn’t as fuel efficient, however (using the Lamborghini Murcielago as an example, it has a 9.6 MPG, which is around a tenth of what the ForTwo has) and if you’re looking to use it on a regular basis, you could be looking at a substantial weekly fuel bill.

3. Insurance – in its most basic from, car insurance is calculated depending on what group the car falls into. Ranging from group 1 through to 20, the higher the number, the greater the cost of your insurance will be and if you were to look at cars on a broad level, small and cheaper ones will have a low insurance cost and powerful, expensive ones will have a higher insurance cost.

Remember, though, that it isn’t just the group that affects your insurance, so although you feel you may be able to afford insurance for a group 15 car, take into account any driving endorsements you have on your license and the insurance might become unaffordable.

4. Repairs – all cars need repairs at some point in their lifetime. Some cars seem to go on forever and ever, only needing the oil changing or new tyres, whilst others appear to need something replacing every few months.

How much money you set aside for repairs is impossible to decide upon, but you should base it on how new the car is and how popular of a brand it is in the UK. For example, buy a brand new Ford and if the warranty didn’t cover the repairs, you can rest assured that as Ford are a massively popular brand, the parts will be relatively cheap. If you’re buying a second hand car such as the Lamborghini Murcielago, then you’re going to want to put considerably more money aside for repairs, as a replacement tyre could cost you several hundred pounds alone.

5. Interest – where possible, you should purchase a car outright with cash. If it’s not possible, however, you need to factor into your budget any interest that will be accrued should you take out finance for the car. Whether it’s a bank loan or a finance agreement direct from the dealer, you could be looking at an average rate of 7% interest, which is additional to the cost of the car itself.

Author Bio: Jardine Motors Group UK operates a large portfolio of specialist franchises of the world’s most prestigious marques, including Lamborghini dealers.

Category: Cars and Trucks
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