The real cost of owning a car per month
A car does not cost the price on the listing. It costs every month you own it.
In short
The monthly cost of owning a car includes fuel, insurance, maintenance and repairs, tyres, parking and tolls, registration and taxes, and washing, plus depreciation, which is usually the biggest and least visible line. Add up the year's costs, divide by twelve, and add the year's depreciation divided by twelve too. The total is often twice what you spend on fuel alone.
When people ask what a car costs, they usually count fuel. But fuel is only part of it, and the biggest line never appears on a receipt.
What it is made of
Fuel
Distance × consumption × price
Visible at once
Insurance
Required and optional cover
Once a year — divide by 12
Maintenance and repairs
Servicing, oil, parts
Grows as the car ages
Tyres
A set for several years
Divide by their life
Parking and tolls
Monthly, occasional
Depends on the city
Registration and taxes
Registration, inspection, taxes
Once a year
Washing and extras
Car wash, fluids, fines
Adds up
Depreciation
How much value the car loses a year
The biggest and least visible
Depreciation
A new car often loses fifteen to twenty percent of its price in the first year and less after that. You do not pay it in cash, but you get less when you sell. If a car bought for 30 000 is worth 25 000 a year later, that is 5 000 a year, or about 417 a month — also part of what it costs.
How to work out your figure
- Fuel: monthly miles ÷ miles per gallon × price per gallon (or the per-kilometre version where you live).
- Yearly costs — insurance, taxes, tyres, inspection, servicing — add up and divide by twelve.
- Monthly costs — parking, washing — add as they are.
- Add the year's depreciation divided by twelve.
If the total is more than you expected, compare it with rideshare and public transport for your actual trips: at low mileage, the car often loses.
How not to get caught out
Yearly bills — insurance, registration, a new set of tyres — arrive all at once and wreck the month's budget. Set aside a twelfth each month, and when the bill comes the money is there. If you have not bought the car yet, work out the running costs first: how to save for a car.
How it looks in the app
In Caudal create a «Car» category with subcategories — fuel, insurance, maintenance, parking — and within a couple of months the report shows what your car really costs by your own receipts. Yearly bills fit well under «Recurring» with a yearly period, or as a goal with a date, so the month they fall due does not catch you out. And under «Assets» you can add the car with its current value and update it once a year — you then see it depreciate in your overall balance.
Common questions
- How much does it cost to own a car per month?
- It depends on the car, the mileage and the city. Add fuel, insurance, maintenance, tyres, parking, taxes and depreciation, all brought to a monthly figure. The total is often twice the fuel spending alone.
- What is car depreciation?
- How much value the car loses over time. A new car often loses fifteen to twenty percent in the first year. It is not paid in cash, but you get less when you sell, so it is a cost of ownership too.
- How do I stop yearly car bills from catching me out?
- Set aside a twelfth of the yearly costs every month — insurance, registration, inspection, tyres. Then the money is ready when the bill arrives, and the budget does not fall through.
Try it on your own money
Caudal is an expense tracker in Spanish, English and Russian. Several currencies, goals, debts, a shared household budget. Recording an expense takes three seconds.
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