Millennials spend as much on car finance as rent

Millennials spend as much on car finance as rent
Millennials spend as much on car finance as rent

One in five millennials spends as much on their car as they do on the roof over their heads.

A new study into the car ownership habits of the under-34s revealed that 20 per cent spend the same paying off the cost of a car as they do on rent and half said that their car was their second biggest expense after rent/mortgage.

Despite the huge cost, the survey by InsuretheGap.com found that the majority (82 per cent) of drivers would be held back if they didn’t have a car. Three-quarters said their car was “essential” to their daily life.

The report comes as an RAC study found that a third of all drivers feel more reliant on their car now than a year ago and separate research found that young drivers are spending £2,500 a year on car running costs.

The InsuretheGap study found an almost even split between millennials who bought their cars outright and those who took out some form of finance.

Thirty-seven per cent prefer to pay for a car on a monthly lease, hire purchase or loan, while 39 per cent bought their car outright.

But the rising expense of ownership could be forcing them into new ownership models. Almost one in five said they were planning to use a car club or ad hoc rentals in future rather than buying a car of their own.

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