27 May 2021
Few things compare to the freedom you feel when buying your first car. Finally, you can go wherever you want, whenever you want. No more waiting for buses, asking someone to drop you off, or biking in the rain to get from point A to B.
But times have changed.
Owning a car was once the most cost-effective way to get around. But with rising concerns about the environment, car tax fees, and the surge in ride-hailing services like Bolt, the era of car ownership is quickly coming to an end. But if you’re still thinking of buying a car in this day and age, here are five reasons why you may want to reconsider.
1. Want to buy a car? Be ready to research, research, research
A car isn’t an impulse buy — at least it shouldn’t be.
People generally invest a lot of time into researching cars because, well, there’s a lot to consider. If you’re buying a new car, you want to factor in the size of the vehicle, what type of fuel it runs on, and the cost of parts and repairs, which varies greatly between car brands and models.
Once you’ve decided on a model, you’ll need to figure out what dealership you want to buy it from. You might even visit several dealerships to see how far negotiating gets you. But what if you find the same model for a better price in another country? Is it worth making the trip and, possibly, paying import taxes? It’s a lot to think about, and if you think buying a used car is any simpler, it isn’t.
You’ll want to take a look at the car’s history, give it a test drive, or even run it by a mechanic to make sure everything is as advertised. The last thing you want is to spend money on a car that breaks down a few days after buying it.
2. Buyer beware, cars are a depreciating asset
Buying a car is nothing like buying a house. In fact, it’s as bad of an investment as a home is a good one. Sure there are taxes and maintenance costs to consider, but all that good stuff comes later.
Almost every beginner accounting course uses the new car example to teach students about depreciating assets. Unlike an appreciating asset like well-chosen stocks and property, the value of your car is destined to decline over time. Actually, it’s worth less than you bought it for as soon as you drive out of the dealership.
Fast forward three years and your car’s residual value drops to 60% of the original price paid — yikes. If you have a car leasing agreement, you can also add the interest fees to your list of losses.
3. The costs don’t end after your purchase
As if the depreciation isn’t bad enough, car ownership costs often run higher than you expect them to. Depending on where you live and the model you choose to buy, car or road taxes can be pretty steep. So steep that major European markets raked in €440 billion in motor tax revenue in 2020 alone.
Then there are the insurance costs, which will depend on the car you buy, the insurance provider’s rates, and if a broker was involved — they’ll also want a cut. Now add fuel, annual checks, oil changes, and other miscellaneous costs from car wash trips to the inevitable maintenance and repair costs that pop up when you least expect them to.
Taking all this into account, you may be surprised by just how much more affordable renting, or ride-hailing, is in comparison.
4. Make the environmentally-friendly choice
The climate crisis isn’t going away any time soon, and car owners are a big part of the problem. When looking at the environmental impact of transport as a whole, road vehicles alone account for 15% of total global CO2 emissions.
While electric cars are gaining popularity, the up-front costs are high compared to their fuel-run counterparts. Luckily, there’s an option that leaves your wallet and the Ozone Layer intact.
5. Get fast and affordable rides with Bolt instead
Bolt is a ride-hailing app that makes getting around easy, affordable, and convenient. With over 1.5 million drivers in more than 50 countries and 150 cities worldwide, day or night, your ride is just a few minutes and a button tap away.
Besides saving yourself the trouble and cost of buying a car, there are no parking fees or petrol costs to worry about with Bolt. And when it comes to keeping mother nature happy, all rides in Europe and the UK are 100% carbon neutral.
Download the Bolt app today to see just how easy it is to get around car-free.
