Natalia de Santiago, personal finance expert: “A new car is a black hole for your finances; in the first year alone, it can depreciate by 20 to 30% or even more.”

Buying a car has never been as expensive as it is now. In just six years, the average price of a new car in Spain has risen by 38% , which translates to an average increase of €11,190. Today, a new car costs an average of more than €40,500, according to data from the VN Barometer prepared by coches.com in conjunction with the National Association of Motor Vehicle, Repair, and Spare Parts Dealers (GANVAM). And that's if we're talking about conventional models, which begs the question: is this a good time to take the plunge or should we wait?

To clarify these questions, we spoke with Natalia de Santiago, an engineer by training but dedicated to financial outreach for years. She is the author of Invest in Yourself , a book full of practical advice for managing personal finances. Natalia has been helping people better understand their household finances for a long time and is very clear that, before making a decision, you have to look beyond the price.

Given the current situation, I suppose you're going to tell me to avoid buying a car...

Absolutely. A new car is a black hole for your finances. It's already worth significantly less right off the lot. In the first year alone, it can depreciate by 20 to 30%, or even more. If you can, avoid buying a new car.

And what alternative do I have if I absolutely need it?

Look for a brand-new or one-mile car with 30,000 kilometers. It makes much more sense. That's when the car has already lost a good portion of its value, but it still has a lot of useful life left. It's much more sensible financially.

Even if you have the money saved up for a new one?

Even if you have it, it's not an investment; it's an expense. And the more you can reduce it, the better. There are other ways to use that money that will bring you more value in the medium and long term.

What does a car mean from a financial point of view?

It's an expense that can take up a lot of money. For many people, it's essential, but it should never be viewed as a profitable investment. Managing it well is key to not losing more than necessary.

Why, then, do so many people opt for new cars?

Often, emotional or social value outweighs economic value. A new car conveys status or security, even if it's not the most practical financial option. If that's the goal, it's best to choose a model with low mileage that looks like it just came off the lot.

What options are there if you can't buy a zero-kilometer vehicle?

You can opt for cars with higher mileage, but this is where risk comes into play. If you don't know much about cars, you can't assess whether they've been well maintained . In these cases, it's best to go to dealerships that sell with a warranty. A 0-km vehicle sold by an official dealer is a very safe option.

Is it worth keeping a car until the end of its useful life?

Yes, absolutely. Replacing it as late as possible is the most cost-effective option. And to do that, you have to take care of it: get regular checks and maintain it properly. Even if the official workshop is a little more expensive, it may be worth it because a well-maintained car is valued more on the used market. Don't skimp on maintenance.

And regarding financing, what should be taken into account?

The ideal is to finance as little as possible. The more we can pay in cash, the better, because the interest on a car is higher than that of a mortgage. It's also better to finance it for the shortest possible term. And you have to consider the risk: if you have a total loss or your car is stolen , the insurance may not cover the full amount you still owe.

Should you compare carefully before financing?

Yes. It's not a generalization; there are good deals from both the brand's finance companies and banks . The important thing is to request at least three quotes, always for the same amount and term, and carefully review the terms: final payment, whether it requires servicing at authorized repair shops, mileage limits, etc. All of that counts.

When does comprehensive insurance pay off?

The newer and more expensive the car, the more it can offset. And this is where the deductible comes into play. A deductible of 500 or 1,000 euros can significantly reduce the cost of insurance. Of course, you should have that money saved up, just in case.

Should you pay the insurance all at once?

Yes, many insurers offer discounts for paying the annual fee instead of monthly. If it's not a stretch to pay the full amount, it's an easy way to save a little more.

Does it matter where the car sleeps?

A lot. If it's left outdoors, especially in bad weather or near the sea, it deteriorates more quickly. Keeping it in a garage extends its useful life, and that's always a saving, especially when it comes time to sell it.

Are renting and leasing good alternatives to owning a car as we understand it?

They can be good options for those who use their car for work and can deduct expenses or VAT. You pay a little more, but you gain flexibility, since you don't need to pay a down payment, you can change cars according to your needs, and you avoid unexpected expenses.

What if we live in a city with good public transportation?

So, the most cost-effective option is not to have a car. Renting one only when you need it or using car-sharing is much more cost-effective. The problem is that we're still reluctant to give up having our own car, but this will change over time.

What three pieces of financial advice would you give to someone who wants to buy a car?

Well, what I was saying before. First: don't buy a new one. Second: finance as little as possible and in the short term. Third: take the best care of your car and extend its useful life as much as possible. These are three things we should keep in mind because they can significantly reduce the total cost of owning a car over the years.

And finally, I can't help but ask you about something we haven't talked about yet: the electric car. How do you see it from a financial perspective?

It's true that electric cars tend to be more expensive upfront , but they can be a good long-term option thanks to lower maintenance and fuel costs. However, their viability depends heavily on available infrastructure and public support. They have great potential for short trips and urban environments, provided they can be charged with affordable electricity.

In short, for now, be cautious with electric vehicles…

Yes, for now, be cautious. And, as I always say, it's best to avoid buying a new car. My advice remains the same: look for a car with a few miles, finance it as little as possible and for the short term, and take good care of maintenance so it lasts as long as possible. That's what will really help you save in the long run.