Amy288

Hi guys,

I will be in America for two years from December studying and have set aside $5000 for a car (I'm aware it won't be the best car in the world but does only have to last the two years!)

I had budgeted $200 a month for car insurance but am started to get a bit worried that won't be enough.

Does anyone have an idea what I should be budgeting?

Thanks in advance

Pulaski

Depending on exactly where you'll be living, $200/mth sounds about right.

If you buy a $5,000 car you should budget about the same amount for repairs.

Amy288

I will be in Kentucky, Luckily I have a few friends who live nearby who are quite handy with cars I have a feeling I will need them!

I couldn't come up with a better option than just buying one and praying with limited funds. So it will be fingers crossed everyday!

My current car insurance is only £45 a month so I'm wincing at $200 but at least it's in the budget I was starting to get worried!

mrken30

Depends on location, age and if the company will accept your UK driving history. $200 a month should cover worse case, but definitely shop around both online and with brokers. You can sometimes cut the cost in half, especially is you have driving history they will accept. Also you may not want to pay for full coverage on a $5000 car, as the deductible may be a $1000 or more.

Remember in some States you may have to pay use tax on that $5000.

mrken30

My insurance double in cost when I moved here, some quotes were 4 or 5 times what I was paying in the UK. So I think your figure of $200 should cover that.

Amy288

From what i've read getting a Kentucky license would bring it down slightly and I know I will have to after 12 months but didn't want to add a driving test to the list of things to get done straight away!

If I thought I could rely on public transport I wouldn't bother but unfortunately it's just not an option! Tho I am wondering if just getting cabs could work out being cheaper overall!

mrken30

Looks like Kentucky has a 6% use tax, so not too bad, $300 on $5000 car.

http://revenue.ky.gov/Business/Sales...s/default.aspx

Amy288

That's actually better than I thought it was going to be, thank you for that!

mrken30

Or use uber or lyft. The other option may be Turo , but you would still need a license for Turo. Other car rental options such as zipcar might work.

the driving tests in the US are far easier than the UK test.

Amy288

I have been looking at long term rentals, the cheapest i'be found so far is £7900 for 11 months so taking into account insurance payments and the price of a car it's about a $4000 difference over the two years.

It's difficult to know which is the best route to take as it's only a temporary move, even though temporary is 2 years!

mrken30

If you are living in a city where public transit is an option and you want to keep down costs. I would definitely check out if you are able to use turo or zip car for the odd occasion when you need a car. Turo are generally older cars. Its also a great place to try a type of car before you buy one.

Pulaski

In NC the use tax on cars is assessed on the deemed value, based on make, model and age, and has absolutely nothing to do with price or market value, or even the condition of the car. Our 2003 Accord, which is in pretty nice shape, for a 13 year old car, but I would say is a roughly $5,000 car at market value, has a use tax of about $30 pa. ..... It might be the same in Kentucky.

Amy288

I've spent quite a bit of time in Kentucky but always had a rental while I was there so no idea how reliable the public transport is but i would guess not that great! Also some of my friends in the area live about a 45 min drive away in a rural area and it's important to me I can get over to see them, I hate the idea of being isolated especially away from home, obviously I can't get spoiled about that tho and I need to be sensible.

I will definitely have at look at those tho, thank you!

$30 will always be preferable to $300 but unfortunately it is the 6% in Kentucky.

It's amazing how many little things like that you don't take into account when in the planning stages! Tuition, rent, utilities, food, books, health insurance etc I had lists and budgets coming out of my ears but a car was just a vague problem I'd sort later, I do regret that and some shopping trips over the summer now lol

mrken30

If Kentucky works like WA, it's a one off payment when you get the car. It's a sales/use tax. Some States or municipalities have other fees such as emissions (DEQ) etc.

MidAtlantic

6% of what? As Pulaski points out it may not be of the sum you pay for the vehicle.