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A student's guide to car ownership at university:

Types of ownership, insurance options, car running costs, and safety tips.

Types of ownership, insurance options, car running costs, and safety tips.

Written by
Julie Daniels
Motor insurance comparison expert
3 JULY 2023
12 min read
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Whether it’s balancing time between work and your social life, finding a course which sets you up for your dream future career, or even just striking the right balance with your health and diet, uni life can be testing for some.

With so much to stay on top of, it’s understandable that you may have overlooked the finer details of car ownership as a student. Just as with any aspect of university life, some thought needs to go into every decision you make.

Should I buy or lease? Am I getting a good deal on my chosen vehicle? How much can I expect to pay every month? And what kind of insurance do I need?

A lot goes into this important chapter of your life. Thankfully, we have the answers to all these questions, plus a few more, in our handy guide. Read on to discover how to make the most out of owning, running, and being responsible for a car at university.

Things to consider when buying a car as a student

Buying a car isn’t something to engage in lightly – no matter what stage of life you’re at. As your means of getting from A to B, you’ll want to make sure you’ve made every step you should to guarantee your vehicle is perfect for what you need. Here are some key factors to keep in mind:

  • Set and stick to a budget. Having a precise budget in mind can make sure you aren’t stretched beyond what you can afford. This is probably going to be your first car, so splashing the cash on a brand-new, high-end model might not be the way to go. Look at what makes and models are within your price range and be firm with your maximum spend.
  • Work out vehicle specifications. The price of a car isn’t the only thing you need to be aware of when making your decision. You’ll want to create a list of other must-haves which also tick the right boxes. Some examples of what you might want to use as criteria in your search are things like:
    • Added tech features
    • Total mileage on the vehicle
    • Recent MOT servicing reports
    • The last time important features like the cambelt, transmission or brakes were changed
  • Shop around multiple places. It’s never been easier to find a wide range of cars at the click of a button. It’s even totally possible to buy a car online (although this does involve some risks). Instead of using the internet to make the purchase, instead think about checking out several dealerships, or even using a car finder tool to track down the perfect model near you.
  • Make sure to do a test drive. Taking a car for a test drive is one of the main reasons why buying online isn’t always a good idea. You’ll want to get a feel of how the car handles, what the biting point of the clutch is like, and if there are any other issues which aren’t immediately obvious from an online listing.
  • Consider safety features. Safety should always be a top priority when on the road. Look for features like anti-lock braking systems, auto-emergency braking, and electronic stability control to make your journey as safe as possible.

Buying vs leasing a car as a student

Choosing to buy a vehicle or just lease it will form a huge part of your decision-making process. But it might be tough to know which option works best for your exact situation. Here are some core comparisons to keep in mind when making the choice.

Factor Buying Leasing
Money More money needed up front, but less over time Smaller upfront costs, but more to pay over a long period of time
Commitment You have the freedom to sell your car whenever you want Lease contracts are hard to break, and expensive when you do
Time Able to drive for a long period of time without needing to make payments The option to upgrade your vehicle every few years (but with continued, new payments)
Other factors

A car’s value typically depreciates as soon as you drive it

You may be charged a fee for exceeding your annual mileage

It’s important to remember when leasing, that the car will also not always be yours to own at the end. You may also be subject to a large termination fee (usually 6-12 months of the contract) if you decide to end early. By contrast, ownership means the car is your asset at the end of your payment schedule.

Ultimately, a lot of what your final decision will come down to will depend on your financial situation at the time you intend to buy or lease. Just remember that you have a lot more freedom when buying, even if the initial sum might be a little bit more.

The cost of owning a car

Simply buying a car doesn’t account for all the costs you might face as a driver. It’s important to fully understand how much your monthly bills might amount to. A number of factors make up a car’s running costs. And insurance, MOT and servicing, tax, fuel, and potential lease payments can quickly add up.

But how exactly do those factors translate when it comes to the average cost of spending on UK roads?

A survey from NerdWallet found that for the average Brit it would cost:

  • £3,406.80 a year to run a car in the UK when you own the vehicle
  • £5,744.40 a year to run a car in the UK while on finance

And how much you can expect to pay will vary greatly depending on where you live. The same survey highlighted that London was the most expensive place to run a car (at £496.85 a month), while in Wales it would cost just £159.10.

While there’ll always be individual factors which can change what you might expect to pay, here’s what you need to know about each of the main contributors to monthly expenses:

  • Insurance. Getting insurance as a student can be tough, and will often be much higher than the average premium given to regular drivers. A number of factors can influence this, but some of the most relevant are age, a lack of no-claims bonus, and the area in which they’ll be driving the vehicle.
  • MOT and repairs. You’ll need to take your car for an MOT at least once a year (assuming it’s less than three years old). What’s more, the older a car is, the more likely it is to need regular replacements. While swapping out a tyre won’t cost a fortune, things like new brakes or a transmission could set you back thousands.
  • Tax. Car owners have to pay tax depending on how much CO2 their car emits. The Government website provides a useful breakdown of how much you can expect to pay for both your first year registering the vehicle, as well as every subsequent year after.
  • Fuel. The cost of petrol changes quite a bit, depending on a number of external factors. The cost of fuel is higher than usual in the UK right now, and could set a driver back a couple of hundred pounds a month if they regularly use their vehicle for longer trips.
  • Lease payments. As discussed, lease payments may need to be made on a month-by-month basis just for the right to drive your vehicle. This averages anywhere from £100 to £1,000 a month.

Car insurance for students

Getting car insurance is part and parcel of car ownership, no matter what point in life you’re at. And, as you might expect, student insurance tends to be a little more expensive, owing to a less experience on the road.

Some of the following actions will make student car insurance more affordable:

  • Choose the car wisely. The smaller the car, and the smaller the engine, the lower your insurance rates are likely to be. This isn’t always a guarantee, but it’s safe to assume that an SUV from 2020 will cost more to insure than a hatchback from the same year.
  • Look at different levels of cover. There are three core types of cover you can take out on a vehicle – comprehensive, third-party fire and theft, and regular third-party. These vary in price with third-party generally providing the cheapest cover and comprehensive being more expensive due to the higher level of cover.
  • Find safe and secure parking. Finding a regular parking spot which is secure and off the main road could also help to lower your premiums. Make this part of your search for accommodation in first year, as well as housing in second and third.
  • Increase your voluntary excess. This is the amount that you pay out of your own pocket before making a claim. Having a higher voluntary excess means your rates could be lowered, as the insurer knows they’ll have slightly less they need to pay out in the case of an accident. Just make sure the amount you suggest is something you could actually afford.
  • Add an experienced driver to the policy. If you have a parent or older sibling who will occasionally drive your vehicle, you can add them to your policy. This could reduce the amount an insurer asks you to pay monthly. Don’t do this if the information given isn’t true, as this is considered insurance fronting.
  • Pay your premium in one hit. While it might not always be feasible, paying off your annual premium in one go could save you money in the long term. Insurers tend to prefer getting their money upfront, which means you may save money when compared to making regular monthly repayments.
  • Take a Pass Plus course. A Pass Plus course is designed to give first-year drivers the chance to experience some hands-on learning, even after they passed their test and acquired a licence. Again, insurers look favourably on this. It’s a sign that you take road safety seriously, as well as evidence that you’re likely to be more adept at driving than most newer drivers.

Driving safety tips for students

While you might feel confident behind the wheel, there’s always more you can do to heighten safety and reduce the chances of having an accident. Make sure to keep these in mind when tackling the road.

  • Try to avoid driving at night. When possible, do your best to drive during the day. While driving at night is sometimes unavoidable, it’s harder to maintain clear vision when your surroundings are dimmer. Try to plan your journey so that you’re outside during daylight hours.
  • Never drive impaired. If you are drowsy, or your senses have been dulled in any other way, avoid driving. Your reaction times will be much slower, which increases the chances of having an accident. Driving while under the influence of alcohol or drugs is illegal, and motorists should not get behind the wheel while intoxicated under any circumstance. Prescribed drugs such as sedatives and stimulants can also affect your ability to drive, so talk to your doctor or pharmacist about whether it’s safe to get behind the wheel.
  • Keep a larger distance in bad weather. When conditions on the road are wetter or slippier, your braking time will be worse. That means if you need to stop quickly, you may not come to a halt in time to avoid running into the back of the car ahead of you. The easiest way to stop that from happening is by lengthening the distance between you and them.
  • Reduce any potential distractions. When your mind is elsewhere when driving, you won’t be able to give your full concentration to the road. Rule 148 of the Highway code considers listening to loud music, trying to read maps, arguing with passengers or other road users, and eating, drinking or smoking while driving as distractions that should be avoided while driving.
  • Keep your emotions in check. “Road rage” is the term given to getting angry at the actions of other road users. While its sometimes easy to get frustrated at other drivers, try not to let it affect you while you drive as this could accidentally see you use poor judgement elsewhere on your drive.

Driving to university: guidance and tips

If you’ve decided to purchase a car back in your hometown, but want to bring it with you to university, you may need to drive it for a long period of time. If this is something you’ve never done before, it’s a smart idea to prepare yourself. Here are some crucial factors to keep in mind for the trip:

  • Inspect your car. It’s always smart to make sure your vehicle is in top shape before any long run. That doesn’t mean taking it to a professional. There are lots of checks you can do quickly by yourself. Some simple things to look at are:
    • Your dipstick level to check on oil
    • How much coolant you have to keep the engine from overheating
    • Whether your tyres are at the right level of air pressure
    • That all your lights are working

It might also be clever to take the car for a little spin around the block. You can use that to check how responsive your brakes are, as well as listen for any other noises which don’t sound right.

  • Plan your route beforehand. This won’t just help you get to your end destination in the quickest and most efficient time, but will also allow you to plan around avoiding rush hours. The less traffic on the road, the better.
  • Allow plenty of time for your journey. Even if you’ve got your route nailed down, always be sure to allow plenty of extra time. You can never totally predict what stoppages you might face on the road.
  • Make sure to have breakdown cover. If you’re worried about the possibility of breaking down when you’re on a long journey, having cover in place to protect you could be the answer.

Do you feel more prepared for owning a car while away at university? Make sure to use this guide as your starting point, and refer back to it whenever you need to.

Julie Daniels - motor insurance comparison expert

Julie is passionate about delivering a great customer experience and rewarding people for saving on their insurance through our loyalty and rewards programme. She’s spoken to the media, including outlets like Sky News and Capital FM, about car and home insurance, as well as our rewards scheme.

Learn more about Julie