Running a car as a young or new driver

Running a car is expensive and, as a young person you’re going to be paying more in insurance.

What you must have by law

There are a few things you must have by law before you can drive your car on the road:

  • First, you need a driving licence. Most people can begin learning to drive when they’re 17. If you haven’t got your licence yet, find out what to do on the GOV.UK website
  • Car tax must be paid on all vehicles registered in the UK driven on or kept on a public road. It’s officially known as VED but sometimes also referred to as road tax. It can be anything up to £2,000 a year or more, depending on how environmentally friendly the car is. When you buy a vehicle, the car tax won’t be transferred with the vehicle. So you must tax it before you can use it. Find out more about the different car tax bands and how much they cost in our guide Car tax bands explained.
  • MOT is a yearly test for all cars over three years old. The vehicle must by law pass the MOT to make sure it’s safe and roadworthy. The standard cost is £54.85 for a car. Garages can’t charge more than this to carry out the test, but many garages charge less than this, so it’s worth looking around. Find out more about MOTs and how to save money on them
  • You’re responsible for making sure your vehicle is always safe to drive (‘roadworthy’). It can be unsafe even if you have a current MOT certificate. You can be fined up to £2,500, be banned from driving and get 3 penalty points for driving a vehicle in a dangerous condition.
  • You must also have a minimum of third party insurance that covers your use of the vehicle.

Insurance

When you first start driving your own car, your insurance is likely to be quite expensive. But, as you get older, your insurance premiums will start to go down if you’re a good driver.

There are a lot of things you can do to reduce the cost if your insurance, such as adding a more experienced person as a second driver on the policy, or reducing your mileage.

There are also a range of telematic, or black box, car insurance options. This involves fitting a device to your car to monitor aspects of your driving like speed and braking.

This can cut the price of your insurance if you’re a good driver. But your premiums can also go up because of bad driving. 

Other big car costs

Fuel costs

Top tips on reducing your fuel costs include:

  • careful driving – gentle acceleration and not driving quite as fast, significantly reduces the amount of fuel that you use
  • efficiency – consider the fuel consumption of any car you’re looking to buy. As a general rule, the bigger the engine, the more fuel it will use
  • heavy items – don’t leave heavy things in the car and take off roof racks if you’re not using them. The heavier the car, the more fuel it will use
  • shopping – supermarkets often have very competitive fuel prices, and you can sometimes build up reward points to spend on other shopping.

Compare the cost of fuel in your area on the PetrolPrices website

Servicing and maintenance

According to RAC, it costs around £472 to maintain a used car over the course of a year. This includes getting the MOT, and any servicing and repairs required.

For a monthly fee, a used car warranty will cover certain repairs on your car, and might even include a service and MOT once a year.

If you decide to take out a warranty, make sure you’re clear on what it covers and what it doesn’t.

Breakdown cover

Most drivers have experienced at least one breakdown.

Breakdown cover ranges from simply having an engineer take a look at your car at the roadside, to having the car picked up anywhere in Europe with a courtesy car to continue your journey in.

Naturally, the higher the level of cover, the more it costs.

Make sure you check what’s included in each level of cover and choose the one best meeting your needs.

It might be cheaper to find an insurance policy that includes breakdown cover. But make sure you check the policy carefully so you know what’s included. 

Other driver responsibilities

Make sure you tell DVLA  if your vehicle has been:

You also need to update your vehicle registration certificate V5C (log book) with DVLA when you change your address, otherwise your vehicle tax reminder letter will be sent to the wrong address. 

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Whatever your circumstances or plans, move forward with MoneyHelper.

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