The new year is a great time to catch those extra savings and start a new budget. Don’t forget to put your car expenses on the list. You can save some serious cash in 2022 by following these simple tips. Read on for five financial decisions you should make in 2022 about your car.
1. Consider an Extended Warranty
When was the last time you checked your warranty coverage? If your vehicle is only a few years old, chances are it’s still under its factory warranty. If it’s older, or if you know no warranty exists for your car, consider an extended car warranty to help you pay for future repairs. It’s easy to get caught up in the language and promises of extended warranties, but here are some basic tips to follow:
-
- Gather your vehicle info. Extended warranty coverage is likely going to depend on the make and model of your car, how much and how often you drive, etc.
-
- Check with your mechanic or local shops to get quotes on major repairs to see what you’d be spending without an extended warranty.
-
- Shop around. Make sure you’re saving money with an extended car warranty before you commit.
Not everyone needs an extended warranty. Those who might benefit from a warranty are drivers of luxury or sports cars, antique cars, or cars you expect to need frequent repairs. An extended warranty is also good for those who prefer (and can afford to) pay for maintenance upfront in the form of a warranty premium.
2. Get an Insurance Quote
The new year is a great time to compare your car insurance with what other companies are offering. To get the cheapest car insurance, you should compare policies often. Comparing car insurance quotes can be quick and easy if you follow these steps:
-
- Gather info for every driver in your house. Birthdates, addresses, and driving histories especially.
-
- Compare more than one quote. Remember to compare your current policy with at least two or three others to make sure you are getting the best deal.
-
- Compare similar plans. Make sure you have all the coverage you require before you commit to a plan. The last thing you need is to get into a bind because you chose price over coverage.
-
- Check for discounts. Before you switch, make sure you check for loyalty or returning client discounts. Insurance companies often offer discounts for a variety of situations, so be sure to investigate each company’s discounts.
Remember to look at local agents as well as the national brands. You may prefer the customer service offered by an agent closer to home, and the prices may be comparable or cheaper.
3. Pay Down Your Note
Especially if you are close to finishing out a car note, it’s time to snowball your debt. Make paying off your vehicle a priority in 2022 and save that money for future repairs, emergencies, or your next down payment. If paying off the car isn’t feasible this year, see what you can put toward the note so that you will get it done in the next two to five years.
4. Create a Savings Plan
Even if you plan to trade your car every couple of years, you should be spending money on insurance payments, scheduled maintenance, etc. Start a savings plan dedicated just to your car. You can open a new savings account, or if it’s more practical (and if you have the self-control), earmark part of every paycheck or a portion of your monthly income to pay for whatever your car needs. Keeping this money set aside will make it easier to pay your insurance and warranty premiums, pay for scheduled maintenance, and create a nest egg for unforeseeable future events.
5. Upgrade Your Vehicle
If it’s time to change vehicles, you should look into upgrading to a newer or safer vehicle. Check with your insurance company before you buy to see what discounts are available for safety features on your new vehicle. Having a newer, safer vehicle will not only save you on car insurance but can also save you in fuel and other road costs.
With all the ways to save money this coming year, don’t forget to consider saving on your vehicle’s costs. Putting your money into well-placed investments, like an extended warranty or investing in a newer car, using a number plate maker for personalized plates, or saving money by putting it aside, or getting a new car insurance quote, will help you with your finances in 2022.
