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Old 06-09-2012, 03:03 PM
 
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wow, glad I don't own one anymore. that's 40 to 50 grand every five years down the toilet, enough for a down payment on a house. for a household with two cars, that's 80-100 grand in five years. crazy. another reason why I prefer to ride my bike, use transit or walk. when I need some wheels I have a zipcar-sharing membership which I use once or twice a week. I'd rather save my money for more worthwhile things like travel.



AAA study finds total vehicle operating costs up 1.9 percent in 2012 - Kelley Blue Book


find your average cost of car ownership by year make, model.

True Cost to Own (TCO) Calculator on Edmunds.com
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Old 06-09-2012, 03:47 PM
 
Location: Thunder Bay, ON
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How do they break down the costs? I suspect it varies a lot.

I don't have a car, but if my parents buy a new car, they would likely sell their old Honda Civic to me. After 14 years, I don't think it's broken down a single time, so maintenance costs should be very low. There wouldn't be maybe $100-200/year for mandatory fees and check ups, and since it's quite old, the cost to buy would be pretty low (around $2000-3000). I probably wouldn't drive it much, likely less than 5000 miles per year, at least while attending university, so gas would be under $1000/year. The main cost would be insurance, which is quite a bit higher here than in the USA and possibly above $2000/year for a 20 year old who's never been a primary driver.
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Old 06-09-2012, 04:03 PM
 
Location: Bellingham, WA
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Not the kind of cars I've owned. More like $2000-2500. That's still a lot compared to my $25 per month bus pass, though.
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Old 06-09-2012, 04:09 PM
Status: "On Break" (set 15 days ago)
 
Location: Foot of the Rockies
81,411 posts, read 91,997,436 times
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Those numbers are always suspect; those reports are always written up to make it more expensive than it is for the average car owner. These two items: depreciation, interest on financing (from the link) are quite variable. We haven't financed a car since 1993, and we've never leased one. We keep our cars a long time. Depreciation is not money spent. If you're not planning to sell the car in a few years, it doesn't matter. Cost of licensing and insuring a car vary from state to state, and also, in the case of insurance, within a state.
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Old 06-09-2012, 04:10 PM
 
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like the article says, $9,000 is an average. it doesn't apply to every vehicle. some cars may be a lot less, some a lot more. that's what an average is. try the TCO calculator for your car. it covers new and used vehicles but there might be a limit to how old the car can be.
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Old 06-09-2012, 04:21 PM
 
Location: Sacramento
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http://newsroom.aaa.com/wp-content/u...gCosts2012.pdf

Assumes new car bought every five years at 6% interest. Not atypical for middle-class America, really, but there are obviously cheaper ways of going about it. For example, even a new practical car (Civic-type) driven 20,000 miles a year is only $7600. There's no reason you can't hold onto your car for longer than five years. The depreciation really slows down by about then and maintenance/repairs don't get out of hand until after 150,000 in most cases. That's not really trying. Buy a car that's five years old and you pay much less in taxes, depreciation, and financing. Do your own basic maintenance. Carry liability and uninsured/underinsured only with a high deductible and high policy limits and you're still well covered for much much less than liability and comprehensive. If you total your own car, whatever, you're not out that much cash, just go buy another one. If financing the used vehicle, add gap insurance when you finance it.

On the other hand, I look at what the car gets me. Probably 75% of the jobs I cover I couldn't reach by any other means even if I wanted to (meaning I could spend 3-4 hours taking public transit instead of 1 driving). Even at $7600, which is more than I spend, that's a deal. If your circumstances are different... by all means, ditch the car. I've lived without one at various times. When I worked in downtown Seattle and lived in Capitol Hill and Belltown (1 mile walk to work) making okay money there was no way a car was worth it. It's one of the ways I was able to save a ton of money on a modest salary despite eating out everyday and spending a lot in bars.
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Old 06-09-2012, 04:46 PM
 
Location: Thunder Bay, ON
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It looks like it only has cars up to 5 years old (not 14), I had to put in a US postal code since it doesn't work for Canada though.

For the 2007 civic, it added up to around $6500 per year. The breakdown was:

-$2100 for fuel --> would be a lot less for me, at least while I'm in university
-$1600 for insurance --> probably about right
-$1000 for depreciation --> would be a lot less since a 14 year old civic can't depreciate much more
-$800 for maintenace --> not sure why it's so high, the US average is around $400 according to the US Bureau of Labour Statistics
-$600 for repairs --> so far it hasn't needed any
-$250 for financing --> again it would be less for a much cheaper/older car, especially with today's interest rates
-$250 for taxes and fees --> maybe

It might be around $3000-$4000 if I was to buy my parents' old civic. I don't plan on getting a car for now though, since I don't need it much and insurance is a huge part of the cost (and would go down as I'm older).
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Old 06-09-2012, 05:08 PM
Status: "On Break" (set 15 days ago)
 
Location: Foot of the Rockies
81,411 posts, read 91,997,436 times
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Again, depreciation is not money spent. If I buy a car for $20K and sell it five years later for $10K, my cost of buying the car is $2K per year.
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Old 06-09-2012, 06:11 PM
 
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The "average" isn't really an average over the fleet. It's an average of the representative NEW vehicles they picked. It's useful as a ballpark figure for the cost to own and operate a new car over the first five years.

However: The average age of an auto in the US fleet is now over 10 years. That reduces the average cost of depreciation and financing a LOT, and also reduces some of the insurance costs, though it increases maintenance costs.

My own cars are 13 and 3 years old respectively, and I didn't buy the three year old one new. Depreciation is effectively zero on the 13 year old car, and was actually slightly negative last year on the 3 year old car (on paper, anyway -- the book value is slightly more than the purchase price). Neither were financed. Since they're figuring the sales tax amortized over a 5-year period, my 13 year old car has a much lower per-year figure in actuality. My 3-year old car, even if I keep it only 5 years, also has a lower per-year figure because I bought it used. I didn't buy an extended warranty, as they assume.
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Old 06-09-2012, 06:13 PM
 
3,791 posts, read 2,791,933 times
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Quote:
Originally Posted by Katiana View Post
Again, depreciation is not money spent. If I buy a car for $20K and sell it five years later for $10K, my cost of buying the car is $2K per year.

but you still have to drive right? most people will take the $10 k from the sale and use it as a down payment on another car.




Edmunds TCO for various popular mid-range and economy models, used only:

used 08 Toyota Solara SE 2-door coupe, 4-cyl: about $8300/yr

used 07 Honda Civic LX 2-door coupe 4-cyl: about $7000/yr

used 08 Ford Explorer V6: about $10k/yr


this is for the used price only. if you're buying new then your TCO goes up considerably. assuming 60 mos. financing. after the car is paid off, the TCO per year drops by about half. if you have 36 mos financing then your TCO is much higher in the first 36 mos. but drops to more than half after that.
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