Monday, December 10, 2012

The Cost of Car Ownership

Thankfully, since I work from home, we’re only a one vehicle family. Add to this the fact that we keep costs relatively low by owning our vehicle outright, which means we avoid car payments and any associated interest on those payments. However, owning a vehicle outright doesn’t mean that we still don’t put plenty of money into our vehicle…mainly through the costs of maintenance as our vehicle ages. And with our vehicle now over 10 years old, those maintenance costs seem to be getting higher each and every year.

Here is a breakdown of the costs of our vehicle ownership over the past year, which can illustrate just how costly owning a car can be, even when that car is paid off.

Repairs and Maintenance
While we’re lucky enough to own our vehicle outright, this doesn’t mean that we get off without other costs as our vehicle ages. This year we’ve put over $1,400 into vehicle repairs. For some, this amount could almost equal the total they make in payments each year; and for us, it’s an indication that the time to buy a new vehicle is drawing nigh. Add another $500 for new tires just this week and we’re at about $2,000 this year for repairs and maintenance costs.

Fuel
Of course it was this year that my wife got a job that required a roundtrip commute of 50 miles each day. And of course, it was this year that gas prices in the Chicagoland area easily exceeded $4 a gallon.

This meant that our gas costs -- excluding summer since she works in a school district -- averaged about $250 a month. With summer costs down to about $100 a month, we managed to average about $200 a month for the entire year, still costing us nearly $2,400.

Insurance
You’d think that the insurance for our aging SUV would be fairly cheap; however, our annual policy coverage cost for our 2002 SUV is roughly $700 a year. This provides us with a $500 deductible 100/300/100 (thousand that is) limits for bodily injury and property damage, and 100/300 limits on our uninsured/underinsured coverage.

Parking
Unfortunately, due to our urban living environment, we end up having to pay for parking. The privilege of utilizing a city parking lot costs us $40 a month. In addition, we must pay $40 for an annual town sticker, pushing our total for vehicle parking related costs to $520 a year.

This means that we paid at total of about $5,500 this year for a vehicle that we own outright. It’s kind of a shocking total considering that we didn’t even have to make a single payment on it, and it’s a good example of just how costly vehicle ownership can be.

2 comments:

  1. At least you don't have to pay daily tolls. :)

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  2. True, Anthony. Plenty of them around the Chicagoland area, but thankfully we avoid most in our travels. Only costs us about $40 a year. Could be much, much worse.

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