Keeping Costs Down for Young Drivers
High insurance premiums are one of the biggest obstacles to getting on the road for young drivers. If you are lucky enough to be able to afford to buy a car, you also need to think about running costs, including road tax, insurance, fuel and maintenance.
While younger drivers may be more concerned about image than the practical considerations when it comes to choosing a car, the coolest cars usually don't come with the cheapest insurance premiums. The best sellers are also not always the best choice.
Research reveals that insurance premiums for drivers aged under 25 have gone up by £16 over the past month, putting their average insurance up to £505 year higher than other age groups. The good news is that the cheapest premiums can actually be found on some very nice cars.
The funky little Fiat 500 is a great choice for young drivers, with bags of style, entertaining driving dynamics and an average young-driver insurance premium of £902. The badge-engineered trio of the Citroen C1, Peugeot 107 and Toyota Aygo are the next cheapest - all three are pretty much the same under the skin but styled slightly differently to mark the different manufacturers. Average young-driver premiums for the three range from £943.69 to £958.69. The slightly larger Citroen DS3 is very fashionable and surprisingly affordable at an average £1,031.17 for drivers under 25.
Young drivers (and their parents) should make a point of doing their research before buying, as the most popular searches for young-driver insurance are for the Ford Fiesta, Vauxhall Corsa and the Renault Clio. All are slightly larger and more expensive cars but account for about a quarter of insurance enquiries made by younger drivers. The average under-25-year-old can expect to pay £1,351 to insure a Vauxhall Corsa, £1,313 on a Ford Fiesta and £1,309 to insure a Renault Clio. That's a difference of more than £400 per year compared to the Fiat 500, for example, yet the four cheapest cars to insure only account for 3% of enquiries made by under 25s.
Not only under-25s but all car owners will be suffering from increases to their insurance premiums thanks to changes to the amount of tax imposed upon insurance policies announced in George Osborne's summer Budget. The 3.5% rise in insurance tax will add roughly an extra £30 to the premium of every driver under the age of 25. At the same time, new legislation to stipulate a living wage for workers does not include younger workers, so while their costs rise, their income probably will not.
Motoring groups have already expressed concern that young people are being priced off the road, unable to afford the high cost of learning to drive and then buying and running a car, and the new regulations risk making motoring even less affordable for future drivers. Choosing a car with cheaper insurance is therefore probably one of the most important steps young motorists can take to get on the road.
Brand new Fiat 500s start from £10,160 and the Citroen C1 at £8,245. Good used examples are also plentiful if you can't afford to buy new. The Peugeot 107 has now been replaced by the Peugeot 108, which according to recent research is the cheapest car to run on the British market, in petrol format at least. Analysis of the cost of car ownership, including depreciation, fuel, road tax and servicing and maintenance, shows that the French city car costs owners £8,056 over three years of ownership. The figures are based upon mileage of 12,000 annually. That works out at 22 pence per mile. The 108 remains part of a triumvirate of city cars with the Toyota Aygo and the Citroen C1, which cost £8,089 and £8,617 to own over three years respectively.
By comparison, the Aston Martin Vanquish costs owners £133,296 or £3.70 per mile for the first three years!