What It Actually Costs Annually To Own A Car
September 1st, 2017
We all know new cars depreciate quickly. But depreciation isn’t the only cost you have to consider when buying a car. Even if you ignore insurance costs, you still have to take maintenance, repairs, and fuel costs in to account. And according to a study from AAA that adds up to nearly $8,500 per year on average.
AAA’s report says it costs $8,469 per year to own and operate a new car in 2017. That’s a grand total of $706 a month. If you break it down by category, though, unsurprisingly pickup trucks are the most expensive, averaging $10,054 a year. And surprisingly, electric vehicles aren’t significantly cheaper to own costing on average $8,439 per year. Depreciation is the biggest cost, and people tended to overlook that factor when buying. The study found that over five years, new cars typically lost $15,000 in value. Maintenance and repair costs were lower, coming in at $1,186 annually. Fuel costs vary by segment with EVs being the cheapest at 3.7 cents per mile and trucks costing 13.9 cents per mile. So of course, if you’re trying to cut costs, the obvious answer is to buy used. Maintenance and repair costs may be slightly higher, but you’ll pay less up front and get much more of your money back when you go to sell. Do you agree or are you all about a brand-new car?