Vehicle Cost Is More Than Your Monthly Payment
When shopping for a vehicle, most people tend to buy the most vehicle that they can afford, with the highest monthly payment that their budget allows. Often, buyers haggle over that last $10 per month without looking into other monthly expenses that they may be facing. Some of these expenses hurt their bottom line, if they are not considered ahead of time.
Chief among these expenses right now is fuel cost. Do you really know how much more or less a vehicle will cost you in fuel over what it is replacing? Are you going from needing regular to premium? Is it a significantly heavier or lighter vehicle? It can really be an eye opener as to how much more or less vehicles can cost to put gas in. A great place to figure out the differences is www.fueleconomy.gov. I find their revised calculation method to be pretty accurate (within 1 mpg in my case).
Insurance and maintenance are the other two areas where montly costs should be considered when looking at your overall monthly vehicle cost. This is especially true with maintenance where some vehicles require a higher interval of oil changes or they may require more expensive maintenance items (like synthetic oil).
What about depreciation? Eventually you are going to want to sell that vehicle you are buying. It would be nice to know if what you are buying has higher or lower future resale value.
Buyers and owners can use our True Cost to Own (TCO) calculator to help you figure out all of these different factors and how they can affect the overall ownership cost. In addition, here is our list of the 2008 vehicles with the lowest TCO. You can use these tools to help figure out what that vehicle is really going to cost, beyond just the monthly payment.
- Posted by
- Lee Scott May 13, 2008, 4:58 AM
- Permalink
- Categories:
- Car Buying, Car Loans and Financing, Car Maintenance, Fuel Economy, Used Cars
I'm in a prolonged hold in buying my next car... the only thing I dont consider though is depreciation, I always plan on holding my cars for a long time. 8+ years 100,000+ miles. So its hard to predicate what a car might cost then. While you can consider it. To me it doesn't matter much.
I have a spread sheet, that looks at inital cost, interest(if any), insurance, gas, maintiance.
I project it out 5 years, though geussing 5 year gas costs is becoming ever harder.
I am planning to buy a Mercedes C-Class this year but I do not enough savings to buy for it. That is why until now I just look the car photos in Car Geek and dreaming that one day I could own a new Mercedes C-Class.
The cost of insurance is likely to rise with the cost of the vehicle. It desire to own a high ticket vehicle continues to drive many purchasers. Understanding the true cost of your dream vehicle may be the best way to stay in the driver's seat. Thank you.
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