CHEAPEST CAR RUNNING COSTS FOR YOUNG PEOPLE SINCE 2015
- Sharp drop in annual cost of running a car for 17-24-year-olds – falling £296 a year following decreases in fuel and falling insurance premiums
- Average car insurance premium for young drivers is £1,095 – the cheapest figure since research began in 2012
- Young drivers could typically save a further £177 by switching to the best deal for car insurance
- Average fuel costs plunge £105 in the last six months to £763 per year – the lowest figure since 2016
12 March 2021 – The cost of running a car for young drivers has fallen by £296 year-on-year, primarily driven by decreases in fuel and insurance costs, according to comparethemarket.com’s latest Young Drivers research. On average, a 17 to24-year-old driver will now pay £2,074 to run their car in the first year – the cheapest annual running cost since 2015.
The research analyses the cost of insurance, fuel, road tax, and breakdown cover. The cost of driving had been rising in recent years, approaching a point where it would have been unaffordable for many young people. But, over recent months, the drop in the cost of insurance and fuel has balanced out the increases seen in previous years.
Car insurance is still responsible for more than half of overall car running costs (53%). However, this cost has declined dramatically in the last year as the pandemic has reduced the number of cars on the road. The average car insurance premium for young drivers now stands at £1,095. This represents a £169 (13%) drop year-on-year and the lowest average cost since this research began nine years ago.
The cheapest premium available to young drivers has also fallen by £113 year-on-year to cost an average of £918. This means young motorists could typically save an additional £177 by switching to the best deal when their premium comes up for renewal.
In addition, annual fuel costs have decreased in recent months as the price of petrol has fallen and motorists expect to drive fewer miles in 2021. A typical young driver will now spend £763 on fuel, driving an average of 7,347 miles over the course of a year. This cost has dropped from £884 at the start of 2020 when the average young motorist drove for 7,480 miles.
Despite these savings, comparethemarket.com research from last year found that almost half of 17 to24-year-olds (47%) with a full or provisional driving licence found that the financial impact of coronavirus made it harder for them to afford the running costs of their car. Although motoring costs are down for now, the wider economic impact of the pandemic on younger generations means many are still feeling the pinch. comparethemarket.com‘s latest Household Financial Confidence Tracker shows that over a fifth (22%) of 18 to 24-year-olds are concerned they will not be able to afford bill payments and financial commitments in the coming weeks.
Cost of running a car for 17-24-year-olds (Nov – Jan 21)
|Cost name||Cost||% of total cost|
|Est. VED (Road Tax)||£125||6%|
|Total cost per year||£2,074||100%|
Dan Hutson, Head of Motor Insurance at comparethemarket.com, said:
“Young people will be relieved that the cost of driving has fallen so dramatically and this will hopefully ease some of the financial strain many are under. With young drivers paying the highest insurance premiums, the recent drop in prices should prevent policies from becoming prohibitively expensive but the biggest savings will only be available to drivers who shop around for the best deal. Young drivers should also remember to speak to their insurer if their current or expected mileage has reduced due to the pandemic, to see if a reduction in premium is possible, and explore whether a telematics based policy could be cheaper for them.”
Most Popular Cars for 17-24-year-olds
|Model||Average Premium||Average Value|
Cheapest Cars to insure for 17-24-year-olds
|Model||Average Premium||Average Value|
comparethemarket.com was launched in 2006 and has grown rapidly over the past fifteen years to become one of the UK’s leading price comparison websites.
comparethemarket.com provides customers with an easy way to make the right choice for them on a wide range of products including motor, home, life, travel and pet insurance as well as utilities and money products such as credit cards and loans.
comparethemarket.com actively works with its brand partners to help provide great services to customers.
comparethemarket.com and comparethemeerkat.com are trading names of Compare The Market Limited. Compare The Market Limited is an insurance intermediary, which is authorised and regulated by the Financial Conduct Authority (Firm Reference Number 778488).