Doing the sums on running a car

31 October 2013

It's the time of the year when my car insurance, road tax and MOT are up for renewal, and it's just sinking in how much I'm spending on running a car.

I have a modest Nissan Almeira, which is nine years old and worth around £1,200. Comprehensive cover with Sheilas' Wheels set me back £307.67 last year, including legal protection, car-hire cover and £150 excess. The good news is that my insurance premiums have gone down. The company recently sent me a renewal quote for £271.15.

This backs up a report by the insurance arm of the AA this summer, which found the average annual comprehensive car insurance quote fell to £594.84 in July 2013, down 9.85% from £659.53 in July 2012 – the biggest drop since the AA began its insurance index in 1994.

Not one to take the first quote I'm given, I started my annual trawl of comparison websites for the best comprehensive cover.

It took me less than an hour to check Moneysupermarket, Go Compare, Confused, Compare The Market and Google+, but they all came in with higher quotes than Sheila's Wheels or with a higher excess. The nearest comparable quote was with Sainsbury's Bank at £274.54.

I then tried Aviva and Direct Line, neither of which are available on comparison sites. Aviva came in at an exorbitant £431 once I'd included legal cover and a courtesy car – and that was with an excess of £350.

I accessed Direct Line via Money Saving Expert because, at the time of writing, the site was offering a £60 M&S voucher by clicking through its link to Direct Line. The quote was for £310.58, which worked out at just £250.58 plus the M&S vouchers.

I then decided to give Sheilas' Wheels another chance and rang up to say I'd found a better price elsewhere. It immediately offered to reduce my annual premium to £263.58. What irritates me is why it couldn't have offered the reduced premium at the outset rather than wait until I phoned up to haggle.

Adding on car tax (£260), an MOT (£54) and AA membership (£109), I'm spending nearly £700 a year keeping my car on the road – and that's before I've filled up at the petrol station.

Now I'm seriously considering ditching my car altogether. I live in Muswell Hill, north London, where there is no Tube, but plenty of buses. The area is very hilly, so I'm excited by the news that 'Boris Bikes' are going electric, with a fleet of e-bikes being trialled next year from a network of docking stations in my area. What could be better – fresh air, light exercise and a chance to save money?

If readers have any tips on keeping down the cost of running a car, email