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Published: 24/08/21
  • Young drivers' car running costs fall by £536 year-on-year in first six months of 2021 as fuel and insurance bills decrease 
  • Typical annual cost of using a car for a young driver is £1,737 – the lowest figure since the research began in 2015 
  • Drop due to young drivers slashing their annual mileage to 3,541, down from 7,347 in the previous year 
  • But young motorists should avoid auto-renewing insurance as they could save an extra £178 by shopping around 

24 August 2021 – The cost of running a car for young drivers has plummeted by £536 year-on-year, primarily driven by lower fuel and insurance costs, according to’s latest Young Drivers research. On average, a 17 to 24-year-old driver will now pay £1,737 to run a car in the first year – the lowest annual running cost since this research began six years ago. 

The cost of driving had been rising in recent years, almost to the point where it would be unaffordable for many young people. But since the start of the pandemic, the declining cost of insurance and fuel has eradicated the increases seen in previous years, according to the research, which analyses the cost of insurance, fuel, road tax, and breakdown cover. 

The dramatic decline in insurance and fuel costs in the first six months of 2021 have been caused by young drivers slashing the average annual mileage that they are insured to drive. Young drivers are only insured to drive for an average of 3,541 miles this year, down from 7,347 miles the previous year. As a result, a young driver's typical fuel costs have fallen to £416, dropping £453 year-on-year – despite a recent increase in the cost of petrol. 

Car insurance is still responsible for more than half of overall car running costs (61%). However, this cost has tumbled in the past year as the pandemic has reduced the number of cars on the road. The average annual car insurance premium for young drivers now stands at £1,062. This represents a significant £120 (10%) drop from the first half of 2020. When the typical cost of buying one of the most popular cars for young drivers is included, the total cost of getting a young driver on the road is £4,633 – a £2,145 decline year-on-year.  

Despite the fall in the cost of car insurance, young drivers shouldn't be tempted to auto-renew when their policy ends. The cheapest annual premium typically available has also dropped to £885. This means young drivers could save an extra £178 if they shop around for a better deal rather than automatically renewing their policies. 

These savings will be particularly beneficial as the wider economic impact of the pandemic on younger people means many are still feeling the pinch. The latest Household Financial Confidence Tracker from shows more than a fifth (23%) of 18–24-year-olds struggled to afford bill payments and financial commitments in recently. 

To calculate how much driving is likely to cost, new motorists can use’s Young Drivers Tool. The online tool also offers suggestions on the most effective ways for drivers to cut the cost of car insurance.  

Cost of running a car for 17 - 24 year olds (Jan 21- Jun 21) 

Cost name  Cost % of total cost
Insurance  £1,062  61.1% 
Fuel £416 23.9% 
Est. VED (Road Tax)  £180  10.4% 
MOT  £55  3.2% 
Breakdown cover  £24  1.4% 
Total cost per year  £1,737  100% 

Ursula Gibbs, director at, said:

“Following lockdowns and working from home, many young motorists have drastically reduced how many miles they will drive this year. These young people will be comforted that the cost of driving has fallen as a result. The steep drop in costs will hopefully ease some of the financial strain many young people are under – and prevent driving from becoming prohibitively expensive.  

"However, paying for insurance remains by far the biggest running cost for young drivers. One of the best ways to cut this cost is to avoid the trap of auto-renewing. Motorists may lose out by choosing to auto-renew their policy if the price given by their insurer is roughly the same or slightly cheaper than last year. Our figures show there are greater savings to be had by shopping around. Young motorists could typically save £178 by searching for a better deal when their policy ends. This substantial saving could be put towards nights out, restaurant meals or festival tickets, allowing young people to make the most of life post-lockdown.  

"When buying car insurance, young motorists should try to be as accurate as possible when providing their expected mileage for the year. If a motorist underestimates their mileage and needs to make a claim, it could invalidate their policy and their insurance provider could refuse to payout. If drivers overestimate their mileage, they may be paying more than they need to for their premium." 

Most Popular Cars for 17-24 year olds in 2021 

Model Average Premium  Average Value 
Ford Fiesta Zetec  £972  £2,227
Fiat 500 Lounge  £651  £4,082
Ford Fiesta Zetec (80)  £815  £4,623
Mini Cooper  £862 £4,724
Vauxhall Corsa SXI  £1,066 £2,061
Vauxhall Corsa Limited Edition  £1,031 £2,844
Fiat 500 Pop  £662 £2,950
Mini One  £792 £3,212
Peugeot 107 Urban  £769 £1,252
Ford Fiesta Zetec Climate  £1,009 £981


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