Monthly car payments highest expense after mortgage
Almost a third (30%) of UK drivers say their monthly car payments are their second highest expense, after their rent or mortgage monthly payments, rising to over half (56%) of under 34s. Drivers in the North East (37%) and West Midlands’ (36%) regions of England and Scotland (35%) are the most likely to agree with this.
The Opinium survey* of 2000 UK drivers, commissioned by InsuretheGap.com, an independent provider of GAP (Guaranteed Asset Protection) insurance for new and second-hand cars, also reveals that a quarter (25%) of under 34s say their monthly car payments cost as much or more than their rent or mortgage payments.
A quarter (24%) of UK’s drivers prefer to budget and pay for a car on a monthly basis, using finance methods including leasing, hire purchase or a loan, rather than worrying about a car’s total cost, knowing they can upgrade when their finance contract runs out. Men (men 26% v women 21%) and younger age groups are more likely to do this, with almost half (46%) of under 34s running their car finances this way, compared to only 16% of over 55s.
Ben Wooltorton, Chief Operating Officer, InsuretheGap.com said:
Owning a car is still a substantial cost for people, and is clearly a heavy burden particularly for younger people.
When so much of their income is going on a car, drivers should be protecting their investment. If a car is written off or stolen, the insurance company will usually only pay the market value of the car, not what was paid for it, so drivers could face a financial shortfall, particularly if they still have a finance agreement or loan to pay off. A GAP insurance policy from a specialist insurance provider, like InsuretheGap, protects drivers from this.
InsuretheGap.com’s policies start from just £63.53* and are significantly cheaper than those offered by car dealerships, and covering gaps up to £50,000.
* The starting price for InsuretheGap.com policies is £63.53 (a two year, return to invoice policy for a car worth £9,999 or less)