Car ownership can be a double-edged sword; it's necessary to have a vehicle to get to work, but it can be expensive. Sometimes unexpectedly expensive. We see consumers each month who own vehicles that need major repairs that exceed the value of the vehicle, and they still owe money on the vehicle. This is tough, and it really narrows your options for a fix. We hope to give some basic advice and stats about budgeting for a vehicle purchase.
Most people just look at the price of the car, and perhaps insurance costs. The other costs to car ownership are: fuel, maintenance, tires, repairs, license/registration/taxes (all vary based on state of residence), depreciation, and loan interest.
AAA performed a recent study and found that on average to own and operate a new vehicle in 2018, the annual cost was $8,849.00. A breakdown by vehicle type:
| Vehicle Type | Annual Cost |
|---|---|
| Small Sedan | $6,777 |
| Hybrid | $7,485 |
| Electric | $8,384 |
| Medium Sedan | $8,866 |
| Minivan | $9,677 |
| Medium SUV | $9,697 |
| Large Sedan | $9,804 |
| Pickup Truck | $10,215 |
Whether you buy a vehicle new or used, looking at the full costs before the purchase and then keeping it maintained is the KEY to longevity and getting the most value out of the vehicle, in terms of resale, or if you keep it, the safety and reliability for yourself and your family.
Happy Motoring!