Think that the cost of a car is simply the number on the sticker at the dealership? Well, think again! Believe it or not, a car can cost anywhere between $8,000-10,000 a year, on top of sticker price, and that number continues to rise! Read on to discover the true, total cost of owning a car…
Of course, most people don’t directly purchase a car in cash, they take out a loan! So, on top of the sticker price, you need to add on the monthly loan payment. Some lucky owners will get away without any costs or interest. However, others will include closing costs, interest, and other hidden fees. Meanwhile, some interest rates grow with time, making the car more expensive to own with each passing year. So, while looking at vehicles on your local dealership’s website, be sure to factor in loan costs!
Purchasing A Tag, Paying Taxes And Registration
So, you used the loan and purchased a new car, great! However, that doesn’t mean its legal to take on a trip yet. First, one has to fill out all the right paperwork with their local Department of Motor Vehicles. And paperwork means more fees and costs. Most importantly, the vehicle needs registration and tags, which can cost anywhere from $100-$300 depending on the state and vehicle. Of course, tags and registration are not the only documents needed to make a car street legal…
Alongside tags and registration, auto insurance is also needed to make a car street legal. Make sure to check with your state, as different states ask for varying levels of coverage in order for one to be able to drive. Also, make sure to do some research! Do not merely pick the first insurance company you find online. While rates are important, coverage and company values are equally important when selecting an insurance provider.
Fuel, Parking And Maintenance
As you likely know, there are daily costs of owning a vehicle like gas. However, when tallied up, many drivers are surprised to find fuel is the highest cost of the year. For many, owning a car also mean paying for parking, regular car washes, and other necessities, which purchasers do not often consider when shopping for a vehicle.
Finally, owning a car will also mean regular trips to a shop for oil changes and other routine maintenance needs, including:
- Tuning up the vehicle.
- Getting new tires and tire rotations.
- Refilling engine oil, antifreeze, and other fluids.
- Changing air filters.
- Installing a new car battery.
- Buying new windshield wipers.
- Other costly payments and installments.
In case you’re planning to buy a new car very soon, make sure to know the full cost of owning the current vehicle. Usually, it’s better to choose a car that will be easier to manage or cost less. If you cannot do that, it might be better to rethink the purchase. Furthermore, to get a cheaper new vehicle, wait for several years before it goes out of style and loses some popularity and media coverage.