Welcome to this week’s edition of our Tuesday Top 5, Econ4U’s weekly tips post to help you manage your money in five easy steps.

There are 246 million cars owned in the United States, so chances are good you have one of them. But next to a house and an education, a car may well be the most money you ever spend on anything. And the costs don’t end after you leave the dealer’s lot. Want to keep your ride budget friendly? Here are a few things to avoid if you want your car to serve you well for years.

1. Don’t bother with maintenance. Skip a brake job here, ignore a “check engine” light there, and you’re risking serious mechanical problems down the road. A $30 oil change at least once a year could save you the trouble and expense of having to replace your whole engine. When it comes to car maintenance, an ounce of prevention is worth far more than a pound of cure.
2. Lease a new vehicle every 3 years. There is a very narrow set of circumstances under which leasing makes financial sense (namely, if you absolutely have to drive a new car all the time and you don’t put a lot of mileage on it). But otherwise it’s a bum deal. For example: A lease on a brand-new BMW 328i sedan runs $459 a month for 36 months, which totals $16,524 over the term agreement. But if you were to buy it new, at the end of three years the car would still be worth $27,600, according to the Kelley Blue Book. In other words, you’re spending more than $100 per month for the privilege of not owning your ride.
3. Trade in Old Faithful for a hybrid. Fueling up is just about the cheapest part of owning a car. Despite the touted gas-mileage benefits of driving a hybrid, you have to drive more than 200,000 miles before you recoup the extra cost of buying a Honda Civic Hybrid over the less expensive conventional model — and even more when gas is cheap. Instead of the Prius, it should be called the Premium.
4. Owe more on your car than it’s worth. A lot of people who carry massive car loans try to roll over their debt for their next car, but it’s a recipe for disaster. This could even be the newest iteration of the subprime mortgage crisis. A rule of thumb: Don’t take on a car loan that you can’t pay off in under five years (or three years, if you really want to be conservative).
5. Speed, run red lights, and otherwise draw police attention. Many states are hurting for tax dollars so much right now that they’ve increased traffic fines across the board. In California, not coming to a complete stop at a red light before turning right will now cost you $381. If you get caught once, you’ll never do that again.

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