How to use this cost of ownership calculator
- Enter the purchase price and how many years you plan to keep the car (five by default).
- Pick a depreciation rate: lower for models that hold their value well, higher for luxury cars and many EVs.
- Enter your annual miles, the car's fuel economy and your local fuel price.
- Add yearly insurance, first-year maintenance and repairs, and registration and fees.
- If you're financing, enter the loan amount, APR and term so interest is included.
How it's calculated
The calculator adds up six costs over the years you own the car:
- Depreciation: purchase price minus the estimated value at the end, with the yearly rate applied to the remaining value each year.
- Fuel: annual miles ÷ mpg × fuel price × years.
- Insurance and registration: each yearly amount × years.
- Maintenance and repairs: your first-year figure, rising 10% each year after that.
- Loan interest: the interest you pay on the loan.
The total is then divided by the number of years, months and miles driven to give cost per year, per month and per mile.
Example: a $30,000 car kept for five years at 15% depreciation a year is worth about $13,311 at the end, so depreciation is $16,689. Driving 12,000 miles a year at 30 mpg with fuel at $3.50 a gallon costs $7,000. Insurance at $1,600 a year adds $8,000. Maintenance starting at $600 grows to $660, $726, $798.60 and $878.46, for $3,663. Registration at $250 a year adds $1,250. Financing $24,000 at 6.5% APR for 60 months costs $4,175 in interest. The total is about $40,777, or $8,155 a year, $680 a month and 68 cents a mile.
How to keep ownership costs down
- Compare cars by cost per mile. A lower sticker price doesn't always mean a cheaper car to own.
- Check how specific models hold their value. Two cars at the same price can lose very different amounts over five years.
- Get fresh insurance quotes at renewal and ask how a higher deductible would change your premium.
- Follow the maintenance schedule. Skipping inexpensive services like oil changes can lead to far costlier repairs.
- Keep the loan term short. A longer term adds interest and keeps you owing more than the car is worth for longer.
Good to know: This estimate leaves out costs that vary widely, such as parking, tolls, car washes and accident deductibles. Add a buffer if these apply to you.
Frequently asked questions
What is the biggest cost of owning a car?
For most new cars it's depreciation, the value the car loses while you own it. It never arrives as a bill, but you feel it when you sell or trade in. Fuel and insurance are usually the next largest costs.
Why does maintenance cost go up each year?
As a car ages it needs more parts replaced, such as brakes, tires, batteries and fluids, and repairs become more likely once the warranty ends. The calculator raises maintenance and repair costs by 10% a year to reflect that.
How can I lower my cost per mile?
Buying a lightly used car avoids the steepest depreciation, and keeping a car longer spreads its purchase cost over more miles. Choosing an efficient vehicle, comparing insurance quotes each year and financing at a lower rate all help too.