Running Costs

How Much Does It Cost to Own a Car Per Month?

Most people budget for the car payment and forget everything else. The true monthly cost of owning a car is typically 40–60% higher than the loan payment alone.

The Full Monthly Cost Breakdown

Here are all the costs to factor into your car budget:

• Loan payment: $300–$600/month (varies widely)
• Car insurance: $100–$250/month depending on coverage and driving record
• Fuel: $100–$250/month based on MPG and driving distance
• Maintenance: $50–$150/month averaged over the year (oil changes, tires, brakes)
• Registration and taxes: $20–$60/month averaged
• Parking: $0–$200/month depending on location

How to Reduce Your Monthly Car Costs

Choose a fuel-efficient car to cut gas costs. Shop insurance annually — rates change and companies compete for good drivers. Buy slightly used (1–3 years old) to let someone else absorb the first-year depreciation. Maintain your car regularly to avoid expensive repairs.

New vs Used: Monthly Cost Comparison

A new $35,000 car on a 60-month loan at 6.5% costs about $684/month in payments plus roughly $250/month in insurance and fuel — call it $1,000+/month. A 3-year-old version of the same car at $22,000 on a 48-month loan at 7% costs about $527/month in payments, with similar fuel costs and potentially lower insurance. Total: around $800/month.