# The Real Cost of Car Ownership

Monthly payment is just the start: Here's the full breakdown

- **Source:** [Money Under 30](https://brifing.si/source/a774c806-226f-4430-9c44-84884ddbe0f5)
- **Published:** 2026-07-28
- **Topic:** [Finance](https://brifing.si/c/finance)
- **Original article:** <https://www.moneyunder30.com/true-cost-of-owning-a-car/>
- **On Brifing:** https://brifing.si/s/4134f114-205b-4360-8221-79b173473e43

## Monthly Payment: Half Your Budget

The biggest expense in car ownership is the monthly loan or lease payment. For example, a used $25,000 Toyota Camry with 20% down and 5% APR would cost $485/month. Leasing has similar costs but buying used builds equity. Longer loan terms reduce monthly payments but increase total interest paid significantly.

## Fuel Costs: Gas vs Electric

In Q4 2022, U.S. gas prices dropped to $3.68/gallon. Driving 15,000 miles annually would cost about $153/month in fuel. While EVs charge cheaper (as low as $0.03/mile at home), installing a Level 2 charger costs ~$2,000. Public charging stations average $0.10/mile, making total fuel costs comparable between gas and electric currently.

## Maintenance: Brand Matters

Reliability dramatically impacts ownership costs. Over 5 years, maintaining a Toyota Camry costs $7,043 versus $20,419 for a comparable BMW. Leases cover most maintenance, but used buyers should check tools like Edmunds True Cost to Own. Luxury brands often have 3-4x higher repair costs than reliable mass-market vehicles.

## Insurance: Young Drivers Pay More

Full coverage insurance averages $1,662 annually in the U.S. Young drivers often pay $150/month. Most loan/lease agreements require full coverage until the car is fully owned. However, there are numerous ways to reduce premiums by up to 40%, including bundling policies and maintaining good credit.

## Taxes & Fees: Vary by State

After paying sales tax upfront, annual registration and title fees apply. Georgia charges just $20 for registration and $18 for titles, while North Dakota's registration costs $274/year. Most states keep these under $100 annually, but they're recurring costs that shouldn't be overlooked in budgeting.

## Parking: The Hidden Cost

Often excluded from estimates, parking costs can exceed insurance in urban areas. SpotHero data shows monthly parking can surpass $300 in major cities. For metro residents, this represents a significant and frequently underestimated expense that can strain monthly budgets unexpectedly.

## Tires & Wear Items

Tire replacements (typically $600-800/set every 3-4 years), wiper blades, and other wear items add up. Seasonal tire changes may require storage fees. These 'small' expenses can total $500-1,000 annually, representing a substantial portion of ownership costs that first-time buyers often overlook.

## Unexpected Expenses

Accidents, natural disasters, or vandalism create hidden costs. While insurance covers repairs, depreciation and downtime create indirect financial impacts. Luxury vehicles face greater risks here - for example, a single accident can cause thousands in diminished value that insurance won't cover.

## Total Cost: $940/Month

Combining all factors, the average monthly cost of car ownership in the U.S. is approximately $940. While AAA's 2022 estimate was $894, our figure accounts for higher young driver premiums and parking costs. Understanding these true expenses prevents budget surprises and helps make informed transportation decisions.

## Sources covering this story

- https://www.moneyunder30.com/true-cost-of-owning-a-car/ — 

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_Summary written by Brifing from the original reporting. Copyright in the original article belongs to its publisher; read the full piece at the link above._