Featured Experts:
MB
CC
RWAdvertising & Editorial Disclosure
Car ownership costs $12,182 per year or $1,015 per month on average, according to a 2023 AAA report. That's up 13% from 2022 when it cost $10,728 annually ($894 per month). Higher fuel, insurance and maintenance costs drove the increase.
Your actual costs depend on what you drive and how much you drive it. Factor in all these expenses before buying a car.
Cost of Car Ownership Fast Facts
Owning a car involves major ongoing costs beyond the purchase price.
Owning a car costs an average of $12,182 per year or $1,015 monthly.
The cost of owning and maintaining increased 13% from 2022 to 2023.
The costs of owning a car include the purchase price, gas prices, annual insurance, finance charges, depreciation, license and registration fees and vehicle maintenance.
The average total cost per mile rose to 81 cents in 2023 from 72 cents in 2022.
Bigger cars cost more to own. SUVs and trucks burn more gas and need pricier maintenance than compact cars or electric vehicles.
AAA reports half-ton pickups have the highest annual maintenance cost at $15,858, while small sedans are the least expensive at $8,939 per year.
Vehicle Category | Annual Average Cost to Maintain |
|---|---|
Small Sedan | $8,939 |
Medium Sedan | $11,048 |
Subcompact SUV | $9,718 |
Compact SUV | $10,066 |
Medium SUV | $11,971 |
Mid-Size Pickup | $12,258 |
Half-Ton Pickup | $15,858 |
Hybrid | $9,650 |
Electric | $10,112 |
Note: Costs are calculated based on 15,000 miles driven annually. Source: American Automobile Association.
Your monthly car payment and gas aren't your only expenses. Insurance, registration fees, maintenance and repairs add up fast.
Each cost category includes specific expenses:
Category | Cost | Description |
|---|---|---|
Depreciation | $4,538 loss in value/year | How much your car loses in value each year. This is based on the difference between what you paid and what it's worth after five years and 75,000 miles. |
Finance | $1,253/year | What you'll pay annually on a five-year car loan with 10% down at average interest rates. Includes taxes and first-year license fees. |
Fuel | 15.93¢/mile | What you'll spend on gas or electricity per mile driven. Based on regular gas at $3.99/gallon for gas cars or 15.8 cents per kilowatt-hour for electric vehicles. |
Insurance | $1,765/year | Annual cost for full coverage if you're under 65, have over six years of driving experience, no accidents and live in a suburban or urban area. |
License, Registration and Taxes | $762/year | All the government fees you pay when buying a car, plus annual costs to keep it licensed and registered. |
Maintenance, Repair and Tires | 9.83¢/mile | Routine maintenance, wear-and-tear repairs and one set of replacement tires over five years. Includes extended warranty costs. |
Source: American Automobile Association
Add up your operating costs (gas, maintenance, repairs) and ownership costs (insurance, loan payments, registration, depreciation). Track your actual expenses for a more accurate picture than national averages.
Operating costs are what you spend only when you drive: gas, maintenance and repairs. These costs vary based on how much you drive.
Calculate your gas cost per mile to budget for fuel expenses. You need your miles per gallon and the price you paid per gallon.
You can track your actual fuel costs using two simple calculations. Divide the miles you drove by how many gallons it took to refill your tank. That's your miles per gallon.
For cost per mile, divide what you paid for that tank by the miles you drove on it.
These two fill-ups show fuel consumption variations, likely due to driving conditions or style.
Gallons for Full Tank | Average Cost per Gallon* | Average Cost of Full Tank |
|---|---|---|
17.6 | $3.45 | $60.79 |
20 | $3.45 | $69.08 |
*Average gas price as of August 10, 2024.
Source: American Automobile Association Gas Prices
Gas Cost | Amount |
|---|---|
Total Gallons for Full Tank | 21 Gallons |
Total Cost of Full Tank | $79.80 (at $3.80 cost per gallon) |
Total Miles Driven | 867 |
For this example, assume you drove 397 miles and it took 21 gallons to fill your tank.
To find your cost per mile, divide what you pay for a full tank by how many miles you can drive on that tank. If it costs $79.80 to fill up and you drive 397 miles, you're paying 20 cents per mile for gas.
Ownership costs are the expenses you pay whether you drive your car or not: insurance, registration fees, taxes, loan payments and depreciation. Depreciation is how much value your car loses each year, which matters when you sell or trade it in.
Average ownership costs for a medium sedan:
Type of Expenses | Average Cost |
|---|---|
Comprehensive Annual Insurance | $1,922 |
Licenses, Registration and Taxes | $668 |
Depreciation (15,000 Miles Annually) | $3,922 |
Finance Charge | $1,030 |
Cost per Year | $7,542 |
Cost per Day | $21 |
Source: American Automobile Association
Car ownership costs dropped steadily from 2012 to 2017, hitting their lowest point at $8,468 in 2017. Costs have been climbing since 2018 and jumped 13% in 2023 to $12,182.
Yearly changes:
Gas prices drove the recent spike. The sharp increase in 2022 shows how much higher fuel costs hit your wallet.
Per-mile costs followed the same pattern, dropping from 2012 to 2017 when they hit 56 cents per mile. Since 2018, they've been climbing and reached 72 cents per mile in 2022.
Gas prices drove the increase. The 2022 surge shows how record-high gas prices pushed up the cost of every mile you drive.
Mike Baldicana, Web Content Specialist at Kostex Garage Repair
Calculate what you'll actually spend before signing papers. Your monthly payment is just the start — insurance, maintenance and gas costs add thousands annually.
Don't assume the dealership where you bought the car offers the best service prices. Shop around for oil changes and routine maintenance. You'll often find better rates at independent mechanics.
Car ownership costs more than your monthly payment. Common questions about total expenses:
Car ownership costs an average of $1,015 per month or $12,182 per year. Your actual costs depend on what you drive, how much you drive and where you live.
You'll pay for repairs, maintenance, registration fees, taxes, auto insurance and gas on an ongoing basis. These add up to most of your annual car costs.
To calculate the cost of gas per mile or cents per mile, divide what you pay for a full tank by how many miles you can drive on it. If it costs $150 to fill up and you drive 1,000 miles, you're paying $0.15 per mile for gas.
Electric car ownership includes electricity, maintenance, insurance and depreciation. Electricity costs less than gas, but your total expenses vary depending on the car's make and model.
About Nathan Paulus
Nathan Paulus is the Head of Content at MoneyGeek, where he conducts original data analysis and oversees editorial strategy for insurance and personal finance coverage. He has published hundreds of data-driven studies analyzing insurance markets, consumer costs and coverage trends over the past decade. His research combines statistical analysis with accessible financial guidance for millions of readers annually.
Paulus earned his B.A. in English from the University of St. Thomas, Houston.
