What the cost of owning a car is made of
The cost of owning a car has six parts, and the largest is the one you never see a bill for: depreciation, the value the car loses while you own it. AAA's Your Driving Costs study, which prices new vehicles kept five years and driven 15,000 miles a year, breaks the 2026 average down like this:[1]
| Cost | Per year | Share |
|---|---|---|
| Depreciation | $4,422 | 34% |
| Fuel | $2,598 | 20% |
| Insurance | $2,098 | 16% |
| Finance charges | $1,184 | 9% |
| Maintenance, repair and tires | $1,760 | 14% |
| License, registration and taxes | $802 | 6% |
| Total | $12,863 | 100% |
Your own numbers can be far from the average. A used car loses less value each year; a long commute burns more fuel; insurance depends heavily on your state, age and record. The calculator above lets you replace each average with your own figure and keeps the rest.
Cost of owning a car by vehicle type
Bigger vehicles cost more on almost every line: they cost more to buy, so they lose more dollars of value, and they burn more fuel. AAA's figures by vehicle category:[2]
| Vehicle | Per year | Per mile | Depreciation | Fuel or charging |
|---|---|---|---|---|
| Small sedan | $9,259 | 61.7¢ | $2,745 | $1,978 |
| Medium sedan | $10,555 | 70.4¢ | $3,664 | $1,755 |
| Subcompact SUV | $10,752 | 71.7¢ | $3,075 | $2,318 |
| Compact SUV | $11,670 | 77.8¢ | $3,998 | $1,764 |
| Medium SUV | $14,447 | 96.3¢ | $4,913 | $3,069 |
| Midsize pickup | $13,089 | 87.3¢ | $4,040 | $3,444 |
| Half-ton pickup | $16,449 | 109.7¢ | $6,248 | $3,580 |
Your result, line by line
In the example, a $36,000 car kept 5 years and driven 12,000 miles a year in Ohio costs $53,793 in all: $10,759 a year, $897 a month, or 90 cents a mile. Depreciation is $20,214 of that, fuel $8,561 and insurance $6,190.
| Cost | Over 5 years | Per year |
|---|---|---|
| Depreciation | $20,214 | $4,043 |
| Fuel | $8,561 | $1,712 |
| Insurance | $6,190 | $1,238 |
| Maintenance and repairs | $8,800 | $1,760 |
| Registration, taxes and fees | $4,010 | $802 |
| Loan interest | $6,018 | $1,204 |
| Total | $53,793 | $10,759 |
The insurance figure here starts from the National Association of Insurance Commissioners' state average for liability, collision and comprehensive coverage, trended to today's prices.[3] For a closer number, use the car insurance calculator, which adjusts for age, record and coverage, or check car insurance cost by state.
How to lower the cost of owning a car
- Buy a car that has already depreciated. Depreciation is steepest in the first years; the car depreciation calculator shows how much a two- or three-year-old car has already shed.
- Keep it longer. Spreading the purchase over more years lowers the cost per year, as long as repairs stay below the cost of replacing the car.
- Borrow less, for less time. The car affordability calculator applies the 20/4/10 rule.
- Shop insurance every year or two. Rates for the same driver vary widely between insurers.
- Drive efficiently. The MPG calculator and gas cost calculator show what each mile of fuel costs.
Business mileage is differentThe IRS standard mileage rate for business use is 72.5 cents a mile for January to June 2026 and 76 cents from July 1, raised mid-year because of fuel prices.[7] It is a reimbursement rate for business driving, not a measure of what your own car costs.
One-time costs when you buy
The yearly figures leave out what you pay once at purchase: sales tax, title and registration. These depend on the state. The car sales tax calculator covers all 50 states, and the vehicle registration fee calculator follows the official fee schedules for 13 states, including value-based fees in Michigan, Arizona, California, Colorado and Massachusetts.
All calculators and guides
Insurance
- How much is car insurancePremium estimate by state, age, record, credit and coverage
- Average cost of auto insuranceNAIC averages and minimum limits in all 50 states
- Car insurance without a licenseWho can buy a policy, excluded drivers and permits
- Car insurance without a carNon-owner policies and SR-22 filings
- Average motorcycle insurance costWhat riders pay and what state law requires
Registration fees
- Vehicle registration fee calculatorExact fee schedules for 13 states
- Car registration fees by stateHow every state charges, plus EV and hybrid fees
- MichiganList-price fee chart and the yearly step-down
- FloridaWeight-based tax and the $225 initial fee
- CaliforniaVLF, transportation fee and county fees
- TexasBase fee, county fees and the EV fee
- PennsylvaniaPassenger, EV road user charge and local fees
- Pennsylvania trucksEvery weight class from 5,000 lbs
- IllinoisStandard plates, EV fee and title
- MassachusettsRegistration plus the yearly excise tax
- ArizonaVehicle license tax from 60% of MSRP
- ColoradoOwnership tax, license fee and FASTER fees
- New JerseyFees by weight and age, and the EV fee
- OregonFees by MPG rating and county
Car sales tax
- Car sales tax calculatorAll 50 states, trade-in credit and fees
- Missouri4.225% plus local tax by your address
- Virginia4.15% with a $75 minimum
- North Carolina3% Highway Use Tax
- Florida6% plus surtax on the first $5,000
- ArkansasUsed-car tiers and local caps
- Pennsylvania6%, 7% or 8% by county
- Ohio5.75% plus your county rate
- ColoradoState, RTD, county and city
- GeorgiaTAVT instead of sales tax
- Massachusetts6.25% and the private-sale minimum
- TennesseeState, local and single-article tax
- New York City8.875% and out-of-state purchases
- Alabama2% state rate plus local
- Minnesota6.875% motor vehicle sales tax
- Arizona5.6% plus city tax; private sales untaxed
- Connecticut6.35%, or 7.75% over $50,000
- Illinois6.25% at dealers, flat RUT-50 for private sales
- Maryland6.5% titling excise tax
- Oklahoma3.25% excise plus 1.25% sales tax
- South Carolina5% fee capped at $500
Fuel and running costs
- Gas cost calculatorTrip fuel cost at EIA regional prices
- Average cost of gasEIA weekly prices by region
- Average cost of gas in CaliforniaPrice and what is in it
- MPG calculatorMiles per gallon, L/100 km and cost per mile
Buying, leasing and loans
- How much car can I afford20/4/10 rule and a car loan calculator
- Car depreciation calculatorValue year by year and cost per mile
- Car lease calculatorMoney factor, residual and due at signing
- Boat loan calculatorPayment, interest and the second-home rule
- RV loan calculatorLong terms, total interest and taxes
- Motorcycle loan calculatorPayment, interest and gear costs
After an accident
- Diminished value calculatorValue lost after a repair, three ways
- Diminished value claimState rules, evidence and total loss settlements
Frequently asked questions
How much does it cost to own a car per year?
AAA's 2026 Your Driving Costs study puts the average new vehicle at $12,863 a year, driven 15,000 miles: about $1,072 a month. Depreciation is the largest part.[1]
What is the cost of owning a car per mile?
About 85.8 cents a mile for the average new vehicle in AAA's study. The example above comes to 90 cents a mile.
What is the biggest cost of owning a car?
Depreciation: $4,422 a year in AAA's average, 34% of the total. Fuel and insurance come next.
Is it cheaper to own an older car?
Usually, yes. An older car loses fewer dollars of value each year, and insurance for collision and comprehensive coverage is often lower; maintenance and repairs rise with age, so the savings shrink as the car gets old.
Sources
- AAA: New Vehicle Ownership Costs Hit $12,863 Annually (Your Driving Costs 2026)
- Your Driving Costs 2026 (brochure)
- Auto Insurance Database Report 2022/2023
- CPI-U, Motor vehicle insurance, U.S. city average (series CUUR0000SETE)
- Gasoline and Diesel Fuel Update (weekly retail prices)
- Highlights of the Automotive Trends Report (2025 edition)
- Standard mileage rates (Notice 2026-10; Announcement 2026-11)