The real costs of driving a new car is higher than you think
Most people have no idea of the cost of providing transportation from point “A” to point “B”. We have assembled some statistics for you to consider; remembering that the average mid-size new car now costs a minimum of $25,000 plus. Financing the average new car at 7.5% interest over 5 years runs $500.95 per month. The average required full coverage insurance is around $50.00 extra per month. With average miles driven of 15,000 per year, totaling 75,000 miles over 5 years and average maintenance costs of $440 which comes out to $36.66 per month adds up to a total expense of $658.78 per month, for the next 60 months, not counting tires or gas!! Oh, by the way, that does not include depreciation of about $15,000!! The total expense, WITHOUT DEPRECIATION to drive from point “A” to point “B” costs $7,905.36 per year and $3,9526.80 for 5 years of transportation; and you wonder why money is tight! This will vary up or down based on your individual transportation requirements. If you have more than one vehicle, multiply the above accordingly.
When it comes time to perform maintenance and repairs and you need to spend a $1,800 to prolong the useful life of your vehicle, take this into consideration. If by doing the maintenance and repairs gets you just another 12 months and /or 15000miles; the average cost would be around $150 month. Compare this to a $25,000 new car which will cost you $9455.28 over the first 12 months, with an average monthly cost around $658.78 which includes $1937.50 in Nevada sales tax that goes for nothing!! Which will it be? A $1937.50 payment to Nevada for nothing or $1,800 for repairs and maintenance to get another 12 months and /or 15,000 miles; you tell me what makes more sense!
So, use the $6,105 you save per year by keeping your vehicle well maintained, safer, and longer in order to realize your dreams, retirement, or children’s education. To fully maximize your transportation dollar, you need to get 150,000 to 200,000 miles out of your vehicle. This is possible because today’s vehicles are built better than ever before. By doing the manufacturers’ recommended maintenance, you will help insure the same level of reliability you have come to know and expect.
