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Auto Refinance

SEP 06, 2022

How to cut vehicle expenses with a limited car budget

Here are a few things you can do to decrease your vehicle expenses.



9 min read

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Vehicle expenses can be an unexpected drain on your finances and use money you were planning to save or spend on other things. If you find you need to cut costs due to a limited budget or just want to know how you can keep your vehicle expenses as low as possible, there are some easy and straightforward ways to save money. Here’s what you need to know. You may be able to save yourself a lot of cash on your car expenses by taking a few simple steps to reduce your costs.

When times get tight

Cutting vehicle expenses can be a great place to start if you're trying to save money. You have to work within a budget whether you’re looking forward to buying a car or already paying off a financed auto purchase. While you may have taken out an attractive car loan that seemed like a great idea at the time, changing personal circumstances can sometimes mean you may need to cut your costs.

Making your money work for you can be a challenge whether your personal financial situation has changed or rising prices and inflation mean you need to start spending less on your automobile. Fortunately, there are some straightforward money saving tips that can help keep your car running affordably. They include understanding your vehicle’s costs, managing car maintenance, cutting insurance costs, and optimizing your auto loan. Let’s take a look at each of these topics in detail.

Understanding your vehicle’s costs

If you want to cut your car expenses, you need to tally up the total cost of your vehicle. You can do this by accounting for all of the monthly and yearly expenses to figure out how much you’re really spending on your car. Don’t forget to add up the insurance, loan payments, and periodic maintenance costs. You can also include a portion of your subscription-based services you use while driving like Spotify or cloud dashcam plans.

Figure out which expenses are essential and which ones are optional. This is all part of working out the cost-effectiveness of your car-related spending. Ask yourself, “For the amount I’m spending on my car, am I making the most of every dollar?”

For example, you may find you’re paying off an expensive car which needs regular servicing every 6 months along with a costly insurance policy which has numerous policy add-ons. However, if you only drive the car once in a while, your vehicle spending isn’t as efficient as it could be.

So if you’re feeling the pinch, what can you do to keep your costs low? One of the most common things for many people to do is to simply “trim the fat” from their budget – that is, only pay for the things that you really need. While there are always add-ons and upgrades to include as part of a financing arrangement or car insurance deal, they aren’t included for free. You’ll need to figure out whether or not they are beneficial to your car and fit into your budget.

See if you can save money on your car payments

Looking to save money on your car loan? Check to see if you can put cash back in your wallet. On average, Caribou customers save $115+ a month*.

Car maintenance

Cars are full of electrical and mechanical components. They need to be maintained fairly frequently to keep them fit for the road and running smoothly. Depending on the make, model, age, and condition of your car, you will need to follow the manufacturer recommended service schedule. Getting the right level of maintenance is important to extend your car’s life and minimize expenses later down the road.

As a general rule, it is a good idea to change your oil and oil filter around every 7,000 to 10,000 miles with periodic service checks every 20,000 to 30,000 miles. Big ticket items like serpentine belts are usually slated for around 60,000 to 80,000 miles. If your car starts making funny noises or has an engine light on, you should also schedule a diagnostic check to determine the source of the problem. These checks can help you avoid catastrophic problems which could cost more to fix later if left unchecked.

If you’re taking your car to a certified dealer or service center, one of the best ways to keep costs down is to only have them do the essential maintenance items instead of a more comprehensive servicing. Focus maintenance around maintaining core engine and system functions. This includes changing your car’s oil which helps to keep your engine well-lubricated and working smoothly along with any gearbox, brake system, and transmission flushes. You should also have your car’s tires rotated every 6,000 miles to prevent too much wear on different parts of the rubber, replace major broken parts, and carry out any other essential services.

Beyond key services that require the expertise of a trained mechanic, there are many other non-essential services that some dealerships may offer you. While they can make marginal improvements in the condition of your car, they can often be expensive and may not necessarily make your car last longer. You can save money by trying to avoid things like AC vent cleanouts (replacing the air filter is still a good idea), optional radiator flushes, less important part replacements, and other non-mandatory services and service items.

Keeping maintenance costs low can be one of the trickier costs to manage, as some problems vary between vehicles on a case-by-case basis. Keep in mind what constitutes a car in good condition also depends on your vehicle’s history, make, model, and driving habits. Again, the central point here is not to go all-in on every possible car fix during maintenance appointments. You can keep your vehicle running by properly maintaining the essential items without many optional and often expensive services.


On average, Caribou customers save $115+ a month*! See if you can put money back in your pocket for things that are important to you.

Reusing old auto parts

Finding affordable sources of parts for your vehicle can also help you limit vehicle expenses. Besides billed labor hours, the next biggest cost of car maintenance usually comes from parts and components. When it comes to saving money on parts, you have a few options. First, you can try to reuse second-hand parts which are still serviceable to save on vehicle repair costs. Second, new aftermarket parts are also worth considering. 

While you can sometimes find auto shops which have lightly used second-hand parts around, installing them on a vehicle can be a rare occurrence due to lower price markups and liability concerns. You will usually need to find a smaller, local auto shop with a larger parts inventory when trying to save money in this manner.

Installing aftermarket parts on your vehicle has its benefits. Using aftermarket parts can be as much as 60% cheaper versus original equipment manufacturer, or OEM, parts. When considering buying brand-new parts, remember second-hand or aftermarket parts can still do the job and keep your car on the road with a tight budget.

It is best to have the parts installed by a trained mechanic unless you know what you are doing and confident enough to handle the task. One of the best ways to source aftermarket components is to go to a local auto mechanic and to ask them if they have any second-hand parts available. With a bit of luck, the mechanic will be able to track down a few components for you. Make sure the part numbers are cross compatible so the aftermarket part will match the fittings and specifications for your vehicle.

It’s well worth doing research to look up the right model numbers and figure out the best brands which are compatible with your vehicle. When it comes to swapping parts, remember that the drawback of not using new OEM parts is you are paying the most for labor.  Repairing or replacing car parts which have a shorter life span can mean you will need to pay for added labor costs later if the aftermarket or second-hand part fails or needs replacement.

Cutting car insurance costs

Some level of car insurance is mandatory in nearly all US states. Do your research to understand the required states and plan types. As long as you meet a minimum level of insurance, you meet these minimum requirements. However, the exact amount of coverage you get above the mandatory minimum is often left up to you.

If you are a careful driver seeking out the best possible level of protection, there are lots of additional coverage add-ons that can be included in your insurance policy. However, when it comes to saving money, be sure to review the add-ons to see if they make sense for your vehicle budget. They will add a few extra dollars onto your monthly car insurance payment, so check to see if you can balance your coverage needs with your budget restraints.

If your circumstances change because of inflation or if you find yourself with less disposable income, a hefty car insurance policy payment can quickly add up — even more so if you have multiple vehicles which need insurance. Cutting back on some of those policy add-ons can help save you money. Try limiting some of the more extended or comprehensive aspects of your insurance you may not always need in an accident. Things like rental car coverage and extra medical payments coverage may be unnecessary and help you save a few dollars a month on your premiums.

Also, when it comes to having an older vehicle, review comprehensive option costs. Comprehensive claims for older cars probably won’t pay out as much since the vehicles’ actual cash values, or ACVs, are so depreciated. If you can drop the comprehensive coverage, you may find your monthly savings are worth it. For example, if you have an older model that is more than 15 years old with 150,000 miles on it, you will save some money every six months by not having comprehensive insurance.

Need more money in your car budget?

See if refinancing your car loan will help! Check to see if you can put cash back in your wallet. On average, Caribou customers save $115+ a month*.

Optimizing your loan

Finally, when it comes to saving money, refinancing your car loan and getting the right offer can save you a lot of money over the life of your loan. Refinancing can help put money back into your budget for other things in the short term if you can take advantage of beneficial interest rates and qualify for a lower rate.

Refinancing can often reduce your monthly payments depending on your original car loan. The trade off for cutting monthly costs is you could find you will need to repay your loan over a slightly longer term. Refinancing can be a great opportunity for you to find a more reasonable loan payment that suits your own budget tightening circumstances.

Cutting costs

It can be difficult to figure out which car costs are worth paying out and which ones it’s time to think about cutting back on. But whether you’re hunting down aftermarket auto  parts or streamlining your monthly loan payments, there are more than a few ways to keep your car costs down.

If you’re paying more than you want on your car loan and are looking for a refinance offer that works for you, Caribou might be able to help. We help save drivers time and money when it comes to finding the right loans for them. Reach out to find out more about how we can help you refinance your car.

Limited budget FAQs

  • How can I save money on car maintenance? One of the best ways to keep costs down is to only have them do the essential maintenance items instead of a more comprehensive servicing. Focus maintenance around maintaining core engine and system functions.

  • Can I save money on auto parts? You have a few options when it comes to saving money on parts. You can try to reuse second-hand parts which are still serviceable to save on vehicle repair costs, and new aftermarket parts are also worth considering.

  • How can I save money on my car insurance policy? When it comes to saving money on your auto insurance, review your coverage levels and add-ons to see if they make sense for your vehicle budget. You can also try dropping comprehensive coverage on older vehicles which have a lower actual cash value for more monthly savings.

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* This information is estimated based on consumers whose auto refinance loan funded through Caribou between 3/1/2023 and 3/1/2024, and had an existing auto loan on their credit report. These borrowers saved an average of $115.72 per month. Refinance savings may result from a lower interest rate, longer term, or both. There is no guarantee of savings. Your actual savings, if any, may vary based on interest rates, the repayment term, the amount financed, and other factors.

+ To check the refinance rates and terms you qualify for, we conduct a soft credit pull that will not affect your credit score. However, if you choose a loan product and continue your application, we or one of our lending partners will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and may affect your credit.

++ Social security number is required should you choose to move forward in the loan application process.

** APR is the Annual Percentage Rate. Your actual APR may be different. Your APR is based on multiple factors including your credit profile and the loan to value of the vehicle. APR ranges from 5.99% to 28.55% and is determined at the time of application. Lowest APR is available for a 36 month term, to borrowers with excellent credit. Conditions apply. Advertised rates and fees are valid as of 5/20/24 and are subject to change without notice.

Terms and Conditions apply. Caribou reserves the right to modify or discontinue products and benefits at any time without notice. Participating lenders, rates and terms are also subject to change at any time without notice. The information you provide to us is an inquiry to determine whether our lenders can make you a loan offer. If any of our lending partners has an available loan offer for you, you will be invited to submit a loan application to the lender for its review. Not all borrowers receive the lowest rate. Lowest rates are reserved for the highest qualified borrowers. We do not guarantee that you will receive any loan offers or that your loan application will be approved. If approved, your actual rate will depend on a variety of factors, including term of loan, a responsible financial history, income and other factors. Offers not available in MD, NE, NV, WV.

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