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How Much Does a Car Cost?

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Saying that a car is expensive today is like saying the sky is blue. In 2019, the average new car cost nearly $40,000 with an average monthly car payment of $550 per month. Beyond selling price and payments, there are the costs of gas, insurance, oil changes and all sorts of other car expenses to consider.

Calculating total car ownership costs can be far more important than, say, choosing your new car’s paint color, yet it can be hard to do. Here’s how to figure out how much a car costs.

How to calculate car ownership costs

According to AAA and Kelley Blue Book (KBB), this is how much a new car costs to own per month, including expenses like fuel, insurance and tires.

Average New Car Cost
New Vehicle Category Average New Car Cost Per Month Average New Car Selling Price
Small Sedan $593 $20,000
Small SUV $700 $26,000
Medium Sedan $720 $25,000
Medium SUV $855 $33,000
Pickup $903 $41,000

Sources: AAA, KBB

Use a calculator

To see how much your car or a car you want might cost you, use a car ownership calculator. Edmunds, for example, gives a breakdown of average insurance, maintenance and repairs, taxes, fees, depreciation and fuel for specific makes and models. You could write down all of your particular car ownership costs or track them in a spreadsheet. Those costs may include:


Most people need a car loan to buy a car.  The average auto loan APR in the fourth quarter of 2019 was 8.06%. New car buyers borrowed an average $32,480 over nearly six years, resulting in $8,591 paid in interest over the life of the loan.  If you are looking for a loan, here is our list of best auto loan rates in 2020.

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The national average cost of auto insurance is about $200 a month, or $2,390 a year. If you’re only interested in meeting the minimum state requirements for auto insurance, however, it could cost you only $78 a month, or $936 annually.

Taxes and registration

While some states have no vehicle sales tax (and topped our best state to buy a car ranking), others have high sales taxes, not to mention annual property taxes. When you first buy a vehicle, expect to spend about 8% to 10% of the vehicle’s price in taxes, title and registration fees. Here are dealership fees to watch out for when you are shopping for a vehicle.


You could be looking at an average of around $125 a month in fuel costs as part of the costs of owning a vehicle. How much you spend on gas, of course, depends on how much you drive and the average cost of gas in your area. To find how much you might spend on fuel for a trip, you could use the gas cost calculator provided by the U.S. Department of Energy.

To get the $125 a month, we found the monthly average of miles driven via Federal Highway Administration data and divided that number by the national average fuel economy of light-duty vehicles according to the Bureau of Transportation Statistics. We then multiplied that by an assumed gas price of $2.11, because, as of early March 2020, the national average gas price was $2.11 per gallon, according to AAA.


As we discussed above, maintenance costs can be hard to nail down. AAA data shows that maintenance, repair and tire costs for a new car average about $89 each month if you drive 12,000 miles a year.  Those costs can shoot up as the car gets older and the warranty covers less if you purchase a used car with more miles.


The largest single contributor to the average annual cost for a new car is depreciation. Most new vehicles are worth only half of their original price after three years, which, conveniently, is when most comprehensive warranties expire. The best way to limit depreciation is to buy a used car.

New vs. used car costs

Plainly put, used cars cost less to buy. Americans borrow an average of $20,446 for used vehicles versus $32,480 for new cars. Yet, used cars generally have higher maintenance and repair costs due to breakdowns and the warranty coverage running out. It’s part of the trade-off when you consider whether to buy a new or used car.

AAA data shows that maintenance, repair and tire costs for a new car average 8.94 cents per mile. So if you drive 12,000 miles a year, that might cost you $1,073.80 a year. Data from the U.S. Bureau of Labor Statistics confirms this number is in the ballpark. It shows that across the board in 2018, on all ages of cars, people spent $890 a year on car repairs and maintenance. Here’s a calculator you could use compare the cost of a new vs. used car.

To lessen the risk of having to shell out money for maintenance or repairs:

  • Research specific vehicle brands and models that are known for dependability. According to J.D. Power’s most recent vehicle dependability study, Lexus, Toyota, Porsche, Chevrolet and Buick are the top five highest-ranked brands for reliability. Kelley Blue Book also features annual awards for specific cars based on their five-year cost to own ranking.
  • Perform regular vehicle maintenance. The best way to avoid a major repair is to keep up with your car’s maintenance schedule.
  • Have a rainy day fund. It’s a smart idea to put aside money each month in case something turns up sour. The budgeting rule of thumb, or the 50/30/20 budget, says you should use 50% of your income to pay bills, 30% on extras like entertainment and put 20% directly into your savings account.
  • Consider an extended warranty. There are all types available, but here’s how to find the best extended-car warranty.
  • Consider an electric vehicle (EV). While EVs tend to cost more than conventional cars upfront, they have far fewer moving parts that can go wrong. Here’s more on electric car maintenance vs. gas car maintenance.


How much does it cost to paint a car?

The average cost for a basic car paint job is $566, but it can go up to an average of almost $5,000 for high quality, according to CostHelper, which tracks consumer pricing. The exact price will depend on the size of the vehicle, the quality and color of the paint and any issues that may have to be taken care of before the car can be painted, like rust spots and scratches. If you are feeling particularly industrious, you could get a beginner’s car painting kit for around $470 with everything you need to paint a medium-sized car, like a Ford Mustang, including the DYC sprayer.

How much does it cost to ship a car?

Car shipping can cost about $1 a mile if you’re shipping the vehicle within a 500-mile radius, but that rate drops the farther you need to ship. For example, shipping a compact SUV from New York City to San Francisco can cost less than $1,300. Here’s how to find a dependable auto shipper.

How much does a car battery cost?

You could expect to spend between $100 and $200 on a car battery, depending on the car and the quality of the battery.

How much does a Tesla cost?

Tesla prices tend to shift like sand in a desert. The best way to know what a Tesla costs is to look at the “purchase price” rather than the “price after estimated savings” for the model you want. The “price after estimated savings” is what Tesla often advertises but it includes potential federal tax incentives and a few years of predicted gas savings.



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