Everybody loves owning a car. After all, it gives you an easy to move around. There are many households that may have two or more cars. However, it definitely puts some strain on your budget, and since you may have been recently facing financial ups and downs, it could be a bit challenging for you to meet expenses related to all cars.
In this situation, you can think of downsizing your car. It means you will be planning to give up your second car. If you are planning to become a one-car household, you cannot make an immediate decision.
There are a lot of factors you need to consider to ensure whether you can manage with your one car or not. There is no doubt that giving up your second car will lead to some savings, but at the same time, it will add to the cost of the car you are using. This blog will discuss both aspects and what affordable alternatives you can use.
Cost savings on giving up your second car
The most significant benefit that you will likely get from it is the money you get by cashing it out. You can liquidate your car even if you have some dues. The resale value will go toward the debt payment first. Here is what you can save by abandoning your car:
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Car payment
Like many other households, you may have a car with outstanding dues. Of course, you will not be left with enough money if you have certain dues, but it is still worth it, especially if you are paying €500 every month toward your car debt.
You will undoubtedly get long term benefits by liquidating your car. It is better if you have already asked about all terms and conditions at the time of taking out car loans in Ireland.
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Gas prices
The fueling process has been rising for a very long time. Undoubtedly, it puts a burden on your financial condition. However, it depends on the mileage of your car how much it would cost you. Sometimes it can cost you more than you expected.
You will have to see how many miles you drive each year to determine the cost of fuel for your second car. You will need a basic mathematical formula to calculate the fuel cost. However, you can also use an online calculator to find it.
Even if you give up your second car, you will not be able to save the entire fuel cost. This is because you will be using more of your current car for regular errands and trips. You can still try to save some of your money by using public transport.
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Insurance, repair and maintenance
If you have sold your second car, you can immediately get your insurance off your current policy. However, note that this is not going to help you save half of the money. If your second car is on the same insurance policy, you will get the insurance on your second car at a discount.
You will have to ask your insurance company to quote your current car. Another cost associated with your car is repair and maintenance. You must be paying for essential maintenance so far, but you can save money on it by selling it.
Further, the higher the miles, the higher the maintenance cost will be. The maintenance cost for electric cars can be higher. You can save all of these costs by selling your second car.
The new cost for your current car
By selling your second car, you will undoubtedly be able to save a lot of your money. You can easily save on fuel, repair, insurance and loan payment. However, it will add to the cost of your current car. For instance, if you and your significant other used to drive to their office in separate cars, now you can decide to drop your partner if the office falls on the way.
However, driving a five-mile extra will also cost you some money. If you both have your office in separate ways, one of you will have to use public transport. Of course, the fare will be an additional cost. However, this will be cheaper than the fuel cost of your second car.
In order to estimate how much you will actually be able to save after selling your secondhand car, you should find out how much cost it will add to your current car.
What are the alternatives to owning a second car?
If you have decided to give up your second car, you can find it difficult for a few days to manage without it.
You need to decide how much money you need to spend on your first car to get around after selling your second car. There are certain alternatives that you can use to own a second car:
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Walking
You do not need to get around in a car when you do not have to cover a long distance. Walking is completely free, and it will improve your health.
If you do not have to go too far, you can easily manage to go on your foot. You should try to avoid using your car for your short errands. It can take multiple errands throughout the day, but it will help save money.
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Bicycle
The bicycle can be a good option for you to cover long distances for your errands. It does not cost you fuel expenses.
You can go grocery shopping on your bicycle. You can also use a motorbike. Though it will cost you fuel, it is still cheaper than owning a second car.
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Public transportation
You should use a mode of public transport to cover long distances, for instance, when you have to go to your work.
Of course, when you stop using your second car, you will need to rely on public transport in order not to add up the cost to your current car.
Public transportation is undoubtedly cheaper than owning a car, and public transport is a better option to save money without adding a cot to your current car.
However, it is not reliable everywhere, and it is dedicated only to some cities and suburbs. However, it may still not be suitable for you to choose public transport because it can be quite hectic.
The bottom line
If you want to live like a one-car family, you can. However, you will have to evaluate your expenses carefully so you do not add up to the cost of your current car. Of course, some of your costs will add to those from your current car, but you will be able to whittle down some of your costs.
The money you save can be transferred to the emergency cushion that you can use to help you tide over. In case you have taken out personal loans in Ireland, you can throw that money toward the debt payments.
