Car running costs increase by £98 a year for young drivers

The latest version of our bi-annual Young Drivers Report has just been released and has revealed that the cost of running a car for a young driver has risen by £98 or 4.4% over the last six months. 

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Overview

In our first ever report we found that 17-24 year olds were paying on average £2,201 a year to run their cars but in the last six months this cost has increased by 4.4% to £2,299 a year. This hike seems to be mainly due to growing fuel costs as prices at the pump have started to recover since falling earlier this year.  

Car insurance remained the most substantial cost, accounting for 54% of total outlay for the year.  Premiums for 17-24 year olds have continued to grow by £10 on average per driver since the last report in March and by £143 compared to July 2015. This seems to be partly due to the increases in insurance premium tax (IPT) announced at both the Autumn Statement in 2015 and the Budget in March 2016.

Annual running costs

As well as looking into annual running costs, our report analyses the most popular cars that are quoted for, as well as the cheapest ones to insure. The Vauxhall Corsa tops the list of most popular cars for 17-24 year olds once again, accounting for nearly a quarter of enquiries, followed by the Ford Fiesta and then the Renault Clio. Only the Fiat 500 made the top ten for both the most popular car and the cheapest car to insure. The Volkswagen Up! is the cheapest car to insure for the second time, costing an average of £849.

cost of running a car

Simon McCulloch, Director of insurance at comparethemarket.com, said:

“The cost of car insurance continues to weigh heavily on young drivers and is the largest portion of the price that they have to pay to get on the road. Younger drivers should look at insurance prices for several vehicles before deciding which car to buy – different models can have vastly different premiums, despite seeming to be broadly similar.”

So your choice of car can really help to save you money in the long run. Further money saving tips can include choosing a more fuel-efficient car, which can reduce your overall running costs, as you may be less impacted by increased fuel prices. This could also reduce your road tax as these cars are usually in a lower VED band.

Telematics or black box insurance continues to be a good idea for young drivers trying to boost their credentials and demonstrate that they’re safe drivers to reduce insurance premiums.

And of course, comparing car insurance premiums can help to save you money. We found that young savvy switchers could save on average £251** per year by switching car insurance providers, so it could be worth taking a look.

You can read the full results and report here.

**The average saving is based on the difference between the cheapest click-through price presented and the mean average of the top five cheapest prices presented to a customer, where a consumer has clicked through to buy.

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