Are You Wasting Money with Your Car?
Here comes another beautiful summer weekend and you probably have a place or two to go. So pack up your car and have fun. Speaking of your car, in my experience, car-owners fall into one of two categories:
- there are the people who loooooovee their cars. They name them. They treat them like babies. They’re obsessed with polishing them and adding accessories, and
- there are the people who no nothing ’bout cars. I fall into this category. I think the dirt is fine since it’s probably holding my car together. I don’t sweat the dings and bumps. And the inside of my car always looks like I’ve just come back from a long car-trip with a band of wild children.
Sadly, both these groups of people may be wasting tons of money with their cars. Look through the following list and see if you’re doing anything wrong that you can cut out and save yourself some cash.
1. You pay to have someone wash your car. I can’t believe what a carwash costs. Every time I drive through the gas station that offers a car wash and see what they’re charging I shake my head. If you’ve got a bucket and some soap and water at home, why would you fork over $10 or more to have some machine wash your car. Why not turn it into a family affair, bathing suits and all, and have a car-washing-soap-and-water fight with the kids.
2. You never put air in your tires. Tires that need air use more gas and wear out more quickly. Don’t over-inflate though. That can be dangerous since not enough rubber hits the road to keep you safe.
3. You buy premium gas. Rumour has it if you use only the best gas your car will need fewer tune-ups and get better mileage. Yes, if you’re driving a high-performance vehicle, you need super-de-dooper gas. But most of us don’t, so don’t waste your money. According to them that know, the difference between 87 and 93 octane is so small that you won’t get better mileage or see lower maintenance bills.
4. You don’t bother to maintain your car or keep records. According to Natural Resources Canada Office of Energy Efficiency Auto$mart Thinking program, a well-tuned engine alone can improve fuel economy by up to 4% while a poorly maintained vehicle can increase fuel consumption by up to 50%. And if you aren’t keeping records, how will you know when someone’s trying to talk you into something you don’t need?
5. You haven’t raised your deductible on your car insurance. You wouldn’t make an insurance claim for less that $1,000 so why not raise your deductable that high and boost your emergency fund. Make the call to your insurance company and see just how much you could save.
6. You’re a speed demon. Cars are most economical at about 100 kph. Driving faster uses up more gas. According to one European study, rapid starts from traffic lights and hard braking consums 39% more fuel. And accelerating and braking is not only hard work on the car, it’s tougher on you as a driver. So relax, which brings me to…
7. You’ve never turned on your cruise control. I love my cruise. It keeps my pace even, eliminates my sometimes leaden foot and makes my ride that much more comfortable. Just don’t turn it on when it’s pouring since there have been problems with cruise control causing hydroplaning.
8. You “warm up” your car. Really? You let your car sit there burning gas going nowhere. So you don’t think your mileage is crappy enough? According to Transport Canada, if every Canadian motorist reduced idling time by just five minutes a day, carbon dioxide emissions would be reduced by 1.6 million tonnes per year. Whew!
9. You never ask for directions. I know more than a few people who fall into this category. Okay, so if you get lost and end up driving around for an extra ten minutes, you don’t think that affects how much you’re spending on gas? Hmmm.
10. You refuse to turn on your air conditioner because it wastes gas. Yah, A/C makes extra work for the engine, increasing the amount of gas you burn. But air conditioners are very efficient so around-town driving using the A/C will reduce fuel economy by about a mile a gallon. The highway is a different kettle of fish. Since driving at higher speeds with the windows down greatly increases drag, using your A/C is the more efficient choice.
11. You don’t plan your trips. You need milk, you jump in the car. Your kid has hockey practice, band practice, skating practice, you jump in the car. You forgot to get the gezunta that goes with the whatchumacalit, you jump in the car. Since trips of less than five kilometres don’t usually allow the engine to reach its optimum operating temperature, particularly in the colder months, you burn more gas.
12. You drive around with your trunk full of crap. For every extra 45 kg (100 lbs) you carry in your vehicle, your fuel efficiency can drop by 1-2%. If you’re not using your roof rack, take it off. Not only is there a weight factor, it affects the aerodynamic efficiency of your vehicle reducing your fuel economy by as much as 5%.
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Tags: car costs, ways to save
July 25th, 2008 at 10:47 am
Mini-vans with removable back seats = good idea. Also = instant tent when camping.
July 25th, 2008 at 11:06 am
Agree with everything beside of #5. I’ve checked auto insurance quotes last week and difference between $500 and $1,000 deductible in my case (YMMV) is $9/month = $108 year. So if I drive for 5 years and have no accident at fault, saved $540, but if I have one - no saving.
July 25th, 2008 at 11:11 am
Awesome ideas - I looked up ways to be more fuel efficient a few months ago and have been following all these rules. It is truly liberating to put the car on cruise control and just go with the flow.
My SUV has been paid off for a few years and it makes no sense to get a new vehicle and start making payments just to try and save some $ on gas….we had to make some changes. As my husband says you can buy a lot of gas with the car payments we’d be paying.
So, instead we are putting money aside and hope to pay cash for our next vehicle (hybrid!).
July 25th, 2008 at 2:05 pm
We went car free last year and have seen many positive returns.
We joined a car sharing program, moved closer to where we spend the majority of our time (without a change in rent) and walk as much as we can and use transit. Our car bill is really low (includes gas, insurance, maintenance, etc) and we have never had any trouble booking a car. Also, our city has allowed all the cars in the fleet to park in permit only parking. I can’t tell you how much I have saved on parking but smile everytime I don’t have to pay.
July 25th, 2008 at 8:34 pm
Love your show and blog. Raised our deductibles a few years back and wow, what a savings. Now, would you recommend cancelling collision and comprehensive on a ‘99 Civic and a ‘99 Dodge Dakota?? I read financial advisers recommending this often. Our deductibles are at $1000 for each. Would love your imput!
July 25th, 2008 at 9:23 pm
I agree with Alex — asked about raising my deductible and was told it would save me less than $100 per year. Also was told I am on a “disappearing deductible” program and would only pay a $300 deductible now (but fee is based on $500, it goes down every year you don’t have a claim). Since I would lose this benefit by increasing the deductible, and since it wasn’t going to save me much money anyway, I decided to leave it as is.
July 25th, 2008 at 9:43 pm
YAY! I think we are golden in almost every area you mentioned! I don’t know if we get to chose the deductible in the bare-bones BC insurance I have on my old vehicles. I just have liablity and basic coverage. My husband (the mechanic) and I really keep our vehicles stripped downinside, less for thieves to target anyways, and healthy working condition — but no frills! I won’t leave the house unless I have a “circuit” planned: bank-druggist-library-grocer, or dump-kidsparty-recycling-gas, that sort of thing. I think it drives my hubby a bit bonksers when we are going somewhere and I say “hey, while we’re at this end of town, do you mind if we go …?” And when we leave town, we plot our route on the GPS hubby got for Christmas last year before we go. Air Conditioning? What’s that? Is it kind of like Power Windows and Power Door Locks? Heck, our cars don’t even have cupholders!!!!! (they are nice cars, but rather simple)
July 25th, 2008 at 11:45 pm
Thanks for the reminders - except #1 - don’t wash your car in the driveway it puts oil, gas, and other debris into the sewer system - use coin operated wand wash - takes one or two loonies but the water is properly filtered before it goes into the sewage system.
July 27th, 2008 at 11:11 am
I live in a big city, not population wise, but area wise. I have never owned a car. I took the bus to college, I used the bus to go to work. I’ve probably saved myself a whole load of money along the way there. I am in walking distance of the mall, and 2 groceries stores. I take a cab when I need one. Which is rare.
I only got my graduated licence last year and hope to get to do my road test for the G1 exit in September. Two reason for getting my licence, my little nephews in Ottawa. Less expensive to rent a vehicle and drive, then fly or spend 7hrs on an overcrowded bus. Even once I have my G licence I won’t be purchasing a car. The licence is handy for emergency and trips.
Oh and I’m in my 30s and never felt the urge to get my licence at 16. Let allow drive or own a car
July 28th, 2008 at 1:43 pm
@ Alex (and Lisa)
I don’t get your logic, Gail’s math is right. By raising your deductible, you’re saving $540 in 5 years (a certainty); your argument against is just that if you have an at-fault accident (a possiblity) then you haven’t saved it. But that just means that you should raise your deductible, because it is better to accept certain savings in lieu of the *possiblity* of paying the same amount at some point in time. You’re also ignoring the fact that the $108 a year could go into your RRSP and therefore save you more than the $540 (as you can deduct it off your income taxes and earn returns on it too); whereas the $108 a year is spent and gone forever. Multiply that out by 40 years of driving and it adds up (many drivers go their entire lives without an at-fault accident)
July 28th, 2008 at 2:31 pm
To Geoff…Thanks! I was with Alex on that one…because I looked at it the same way he was. However, you are absolutely correct. When I think to my own situation, I have had 2 accidents (neither of them being my fault) so I paid nothing anyway. Hmmm. Think I will be making that call to insurance tomorrow. Thanks for the great explanation
July 28th, 2008 at 6:32 pm
Deductible:
How much do you have in your savings/emergency fund to pay for it?
how much can you come up with in a pinch?
What is your comfort level with it?
Just because you wouldn’t put a claim under 500 or 1000 $, does that mean that you deductible should match that?
Deductible amount is different from reasonable claim to make.
July 28th, 2008 at 7:10 pm
maybe save up for it now before messing with your insurance. save what you can when you can, then when $1000 is safely in the bank, up your deductible. if getting into an accident will force you to put $1000 on a credit card, then maybe paying the extra few $’s a month in insurance is worth it.
and isn’t that what insurance is anyways? money you never see back but seem to pay anyways? it’s one of life’s expenses. like food etc.
so cover your butt first, them up it in my opinion.
July 29th, 2008 at 9:26 am
The question here is about possibilities and certainties. In general a 100% certainty of saving $108 a year is better than a less than 100% chance of needing to pay an extra $500. And that assumes that the at-fault accident happens immediately after you change your policy; if it happens four years in than it’s only $68 - if you take the $108 a year you would have paid already and save it; you’d make that back the next year - unless you get another at-fault. And after 5 years of no accidents, you’ll have banked enough and now whatever you save is yours to spend on something you want, and don’t need to pad the insurance company coffers. However, if you had 3 at -faults in the past 2 years, your mileage will differ
Insurance is one of life’s expenses, but it should serve a purpose, like food does. Insurance exists to cover catastraphic loss, one that would wipe you out financially if you didn’t have it which is why it’s a good idea to have it. However, just asyou can eat too much, there are risks of being overinsured (I’m looking at you, universal life) that too many people overlook and just accept the extra $10 / month they pay.
July 29th, 2008 at 9:29 am
And Kristin, you wouldn’t have to save $1000 in your emergency account if you change your insurance policy, you only have to save $500, because your deductible is already $500 and so you should have that already (or be prepared to come up with it).
July 29th, 2008 at 2:51 pm
Another good post Geoff…lol. I most definitely agree!
Regardless of each person’s opinion on a specific matter, Gail is probably most proud that she has got us all “thinking” and trying to figure out the best way to spend our money and not waste it.
July 29th, 2008 at 3:19 pm
Thanks Fiona, I’m trying to find my way myself and use a variety of sources. I think it’s great what Gail does, though sometimes I think on this board that Gail is advocating frugality, when she to me anyway advocates responsible purchasing (in other words, if you can afford it, go ahead and buy that Yacht Ms. Jolie-Pitt). A great blog that Gail has already mentioned is http://www.canadiancapitalist.com that has occasionally high-level but usually quite accessible personal finance information, and I’ve learned a lot through there (and in fact probably stole a lot of the insurance stuff above from).
July 29th, 2008 at 4:49 pm
@Annette
In Calgary it is illegal to wash your car in your driveway/laneway………..so you are right about the coin operated wash.
August 6th, 2008 at 9:15 am
My 10 year old car with 210K on it died on me last week. We have already spent $2000 on it this year and this current problem will cost another $1500. Doesn’t seem worth it. We spent the weekend cruising used car lots. I’d forgotten how stressful it is to buy a vehicle, particularly a used one. Doesn’t help that my job is not as secure as it has been because of the current state of the economy. And we’d have to use our line of credit to pay for some of it. Arrrgggg. Guess I need to brush up my resume this weekend and start looking for a part time job to pay off the vehicle as quickly as possible.