There are around 1,400 new car models sold in New Zealand - a dizzying amount. But for all of us the choice comes down to two main factors: what are my needs and what can I afford?

1. How many people does it need to seat?
2. What do I need to carry in it?
3. Do I want diesel or petrol?
4. Do I want an automatic or manual?
5. How big is my parking area?

• Hatchbacks - 3 or 5 doors with smaller engines (less than 2 litres), with a rear opening hatch and fold down rear seats for stowing gear. A great design for single people or smaller families.
• Sedans - 4 doors with medium sized engines (2-3 litres), with good room in the back seats and a good sized boot. Practical choice for a medium sized family with power to tow a trailer.
• Station wagons - 4 doors plus a large rear storage area. Increasingly these have fold down seats in the rear giving seating for 7. Medium to large engines (2-4 litres). A big family favourite.
• SUV/RV's - These vehicles range from plush crossover vehicles with all-wheel drive suitable for ski-roads or shingle, through to bush-bashing utilitarian trucks with two gearboxes.

Work out the maximum amount you can afford. If you are going to take a loan to buy the car, then a useful rule of thumb is that you shouldn't be paying more than 20% of your monthly take-home pay. Check out Simplify's loan calculator to work out in advance what your repayments will be.

You'll need to consider fuel consumption; there's no point in buying a Hummer if you need to spend less than $3,000 a year on fuel.

The standard unit of measurement for fuel consumption is how many litres it would take that car to drive 100km. In general terms, 5-8 litres per 100km would be considered good fuel efficiency, 8-12 litres per 100km would be average, and more than 12 litres per 100km is considered fairly poor fuel efficiency. Your own driving habits have a big impact, too.

To work out the likely annual running costs of any car you can go to Fuelsaver, a government funded web service, which will provide you with estimated annual running costs for all new cars sold in New Zealand.