The Real Cost of Car Ownership
2008-09-01 (updated 2012-09-17)
|Average Annual Household Expenditures, 2010|
|Item||Proportion of Total Expenditure|
|shelter (home mortgage or rent)||34%|
|car ownership & operating expenses||15%|
|pensions & Social Security contributions||10%|
|source: BLS Current Expenditure Shares Table|
According to the Dept. of Labor's Bureau of Labor Statistics, car ownership costs are the second largest household expense in the U.S. . In fact, the average household spends almost as much on their cars as they do on food and health care combined for their entire family (see table at right).
Since all households have only a limited amount of income, the amount a household spends on its car(s) is lost money they could have spent on other worthwhile expenditures, like saving for retirement, education, or the purchase of a home. The question is, how much is it really costing them in terms of these foregone opportunities?
Our "Real Costs of Car Ownership" calculator attempts to quantify this. You can use the default values (taken from the 2010 Bureau of Labor Statistics Consumer Expenditure Survey) or enter what your own household spends each year. Using this data, the calculator calculates your family's monthly average car expenses. It also calculates what your family would achieve if it used this amount to make monthly contributions to a retirement savings account, education savings account, or home mortgage, instead of spending it on your car(s).
Categories: Carfree Living