'Buying a car is a big financial commitment and it's easy to be overwhelmed by the choices on offer. Having a resource at your fingertips can help you make the right decision. Whether it's a sedan, a hatch or an SUV you're interested in, before you shop around consult ASIC's MoneySmart Cars app.' explains V8 Supercar driver Craig Lowndes.

It's the perfect tool to assist with your research so the car you buy meets your need', said Craig.

Buying a car is an emotional decision. The type of car you buy is important because you'll own it for a long time so it has to meet your needs.

The MoneySmart Cars app helps you become an informed car buyer and gives you more confidence and control when you go into a car dealership.

A new mobile phone app – MoneySmart Cars - developed by ASIC will support Australians with the financial decisions associated with buying a car.

ASIC's MoneySmart Cars app is a free education tool to help people understand the real costs of buying and running a car. It will assist consumers with their research to make informed choices.

The MoneySmart Cars App helps you:

  • The real cost of buying a car, including interest, extras and ongoing costs;
  • Avoiding common car buying traps, such as being sold extras you don't need or want;
  • Finding alternate ways to finance a car; and
  • Making informed financial decisions prior to purchase.

'With the average car debt per household at about $19,500, buying a car, particularly for young drivers, is an exciting but expensive financial commitment. Our research found that while price is a key consideration, other costs such as loan interest, insurance, servicing and fuel are generally not considered', said Mr Peter Kell, ASIC Deputy Chairman.

'Knowing how much owning a car will cost you, including the cost of interest and add-ons you might not think about, will help you make informed decisions about how much you can afford and ensure you get value for money', said Mr Kell.

For example, using ASIC's MoneySmart Cars app reveals that purchasing a $15,000 used car on finance, will cost $817 per month, and a total of over $50,000 over 5 years, with interest and running costs taken into account.

'We also know that many consumers fall prey to poor financial decisions, when in a car yard for example, because they may be solely focussed on the car or overwhelmed by information overload. ASIC's new app is a practical tool that puts you in the driver's seat', Mr Kell said.

'AFS fully supports ASIC's MoneySmart Cars App initiative' says AFS Executive Director, Brad Dale.

'There is obligation on the financial industry to promote confidence and trust in the financial system and a key cornerstone of this obligation is to lift the level of financial literacy amongst consumers. Being fully informed about the total cost of buying a car, or any leisure goods, ensures consumers avoid common car buying traps and paying more than they should', said Mr Dale.

ASIC's MoneySmart Cars App is available now on the App Store and Google Play.