How to Lower the Cost of Owning a Car

Save hundreds, possibly thousands, on your annual car costs with these tips.

Do you know how much it costs to own and operate your car each year? It’s probably much more than you think: The total annual expense to keep an average car on the road in the United States in 2018 was $8,849, according to AAA’s annual Your Driving Costs study.

Even if you follow a strict budget, car payments, gas, preventive maintenance and insurance can add up—fast. Here’s a breakdown of the cost of owning a car, plus tips to help you minimize the amount you spend—both now and in the future.



The biggest cost of owning a car is one many don’t take into consideration: depreciation. It accounts for almost 40 percent of the cost of owning a new vehicle—more than $3,000 per year.

Tip 1: If you’re in the market for a new car, consider purchasing a gently used vehicle instead. Chances are you’ll find a safe, reliable vehicle at an attractive price—without the quick decline in value.


The second-biggest cost of owning a car: fuel, at nearly 20 percent of your annual bill.

Tip 2: Don’t buy premium gas unless it’s required for your vehicle. AAA tests found no benefit to using premium fuel in a vehicle designed to run on regular gas.

Tip 3: Purchase gas from a Top Tier-branded station to maximize your vehicle’s performance and fuel economy. Gasoline that meets Top Tier standards keeps an engine cleaner than other brands. Find out which brands are Top Tier.

Tip 4: Slow down. Gas mileage increases at lower speeds—even a 5 mph reduction can have a significant impact on the amount of fuel a vehicle uses.

Vehicle maintenance

The third-biggest cost of owning a car: preventive care and repairs, at 14 percent.

Tip 5: Act now to avoid higher repair bills in the future. Keep up to date on routine maintenance and use synthetic oil instead of conventional oil. Tests by AAA showed synthetic oil performs 47 percent better than conventional oil, providing significantly better engine protection.

Tip 6: Consider buying an electric vehicle, which boasts significantly lower fuel and maintenance costs.

The AAA Your Driving Costs study examined 45 model-year 2018 vehicles. Figures were calculated based on the cost of fuel, maintenance, repairs, insurance, license/registration/taxes, depreciation and loan interest.

Between 7/1/17 and 9/30/17, the average savings off MSRP presented by TrueCar Certified Dealers to users of TrueCar powered websites, based on users who configured virtual vehicles and who TrueCar identified as purchasing a new vehicle of the same make and model listed on the certificate from a Certified Dealer as of 10/31/2017, was $3,383. Your actual savings may vary based on multiple factors including the vehicle you select, region, dealer and applicable vehicle-specific manufacturer incentives, which are subject to change. The Manufacturer's Suggested Retail Price (“MSRP”) is determined by the manufacturer, and may not reflect the price at which vehicles are generally sold in the dealer’s trade area as not all vehicles are sold at MSRP. Each dealer sets its own pricing. Neither TrueCar nor Auto Club Trust, FSB, sells or leases motor vehicles.

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