Car ownership is expensive

Many of us purposely buy a smaller car in order to save money on gas and maintenance and because of initial lower cost of smaller cars to purchase compared to larger sedans. Have you ever calculated how much it cost you to own and operate a car?

Let’s talk about the ownership first. Even if you leave the car in your garage there are yearly fixed costs associated with owning a car. They include paying sales tax at the time of purchase of the car, yearly licensing fees and registration paid to the state government, interest paid on a car loan, and vehicle insurance cost. Many of us pay little attention to the depreciation. Minutes you take your car out of the dealership, your vehicle start to lose value. Not many of us pay attention to this.

Next the operating cost. More you use the car, more you have to pay for gasoline and maintenance.

The AAA estimates that to drive 10,000 miles a year, a car could cost up to $7,835 or 78.3 cents a mile driven. Of course, depending on the type of the car you drive, your estimated cost operate a car could be higher.