The Real Costs of Car Ownership Calculator

Average Annual Household Expenditures, 2010
Item Proportion of Total Expenditure
shelter (home mortgage or rent) 34%
car ownership & operating expenses 15%
food 13%
pensions & Social Security contributions 10%
utilities 8%
health care 7%
entertainment 5%
clothing 4%
household furnishing 3%
education 2%
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).

annual vehicle purchase costs (do not include finance charges) /year
annual finance charges on vehicle loan(s) /year
gasoline and motor oil /year
annual car insurance expenses /year
annual maintenance and repair expenses /year
vehicle rental, leasing, licenses, and other fees /year
Click this button to calculate the total. >> 
Monthly Costs - This is your total monthly household car expense. If you didn't own a car, this is how much you'd be saving each month. /month

Retirement Savings

If you didn't own a car and began investing your monthly automobile savings at age 25 at 5% interest, you would have by the time you retired (if you retired at age 67).

College Savings

If you didn't own a car and invested your monthly automobile savings for 18 years at 5% interest, you'd have for your children's college education.

According to the College Board, the current annual cost of college at a public university is $7,605 per year and inflating at roughly 8% annually. This means the average cost of a four-year college education in eighteen years is about $136,940. If you didn't own a car and saved the money instead, you would be able to send a total of children to college 18 years from now using just the money you saved from not owning an automobile.

Home Mortgage

If you didn't own a car and bought a house using your monthly automobile savings, you could obtain a home mortgage, assuming a 5% fixed, 30-year loan. This would be enough to cover of the purchase price of the median existing home in the US in Dec 2010, according to the National Association of Realtors