December 22, 2017

Average Cost of a Car May Surprise You

Read more about Cars

If you want a new car, plan to spend an average of $31,000. Prefer a used car? You'll still need between $11,300 and $19,000.

© Autoviva (CC BY 2.0) via Flickr

Keep reading to learn more about the average cost of a car, going beyond the price you pay at the dealership.

  • What is the average cost of a new car?
    Today, buyers spend an average of $31,000 on a new car. This is after an average of $3,800 in incentives.

  • What is the average cost of a used car?
    Today, a mid-sized used car sells for an average of $11,321. But a mid-sized SUV sells for almost 40% more, at $18,787.

  • How much should you spend on a car?
    Keep your car payment within 10% of your monthly take-home pay to avoid spending too much on a car. Working backwards, you can use a car affordability calculator to determine how much car you can afford. The calculator takes into consideration the payment you can afford, the money you put down, and the sales tax on the car.

  • How much can you save by buying a used car?
    Buying a used car may save you money on depreciation. On average, cars depreciate as much as 50% in the first 3 years. If you buy a 3-year-old car, you could save that 50%. On a $30,000 car, that means saving as much as $15,000. However, keep in mind the higher costs of maintaining a used vehicle. The older a car is, the more it costs to repair. On average, for every year a car ages, the repair costs increase around $800.

  • What is the average cost of owning a car per month?
    On average, it costs $706 per month to own a car. This amounts to $8,469 per year. Breaking the costs down by vehicle type, pick-up trucks are the most expensive to operate, at $10,054 per year. Surprisingly, electric vehicles cost an average of $8,439 per year.

  • What is the average price of a new Honda?
    Today, a new Honda costs an average of 3% more than it did last year. You'll pay an average of $28,070 for a new Honda. Of course, the actual amount spend depends on the car options as well as the financing terms you choose.

  • What is the average price of a new Ford?
    Ford cars experienced a 5% increase since last year, costing drivers an average of $38,737 this year.

  • What is the average price of a new GM car?
    GM cars have the highest price among Honda, GM, and Ford cars. You'll pay an average of $39,959 for a Buick, Cadillac, Chevrolet, or GMC.

  • What is the average price of a compact car?
    Compact cars are among the cheapest cars you can purchase today. However, they did experience a 2% average price increase over last year. Today, you'll spend an average of $20,610 for a compact car.

  • What is the average price of a full-size pick-up truck?
    Full-size pick-up trucks did not see as large of an increase this year. Their price increased around 1.6%, costing drivers an average of $47,035.

  • What is the average price of a minivan?
    Minivans saw the largest increase in average price since last year. Increasing 4%, it costs drivers an average of $33,590 for this child-toting vehicle.

  • What is the average price of an SUV?
    SUVs actually saw a decrease in price over last year. The drop was only 0.6%, but it's still a drop. SUVs cost drivers an average of $24,438 today. This is 27% less than the average minivan cost.

Operating a Car

  • How much does it cost per mile to drive a car?
    The average cost per mile to drive a car depends on how much you drive on average. Using the standard 15,000 miles per year average, it costs an average of $0.51 per mile to drive a car. Drivers who drive an average of 10,000 per year pay an average of $0.76 per mile.

  • How much does it cost to maintain a car per year?
    A new car costs a driver an average of $1,400 during the first year or first 25,000 miles. After the initial 25,000 miles, the costs increase an average of $800 per year.

  • What is the average cost of gas per month?
    On average, drivers spend $136 per month per car. This figure is based on an average of 1,250 miles driven per month at an average $2.51 per gallon for gas. This assumes a combination of city and highway driving.

Paying for a Car

  • What is the average monthly payment on a new car?
    The average payment on a new car, bought or leased, is $504. This figure is based on borrowers with good credit. Borrowers with average credit pay an average of $524 per month for a new car.

  • What is the average length of a car loan?
    Today, the average loan term for a car loan is 69.3 months. This is 6.8% longer than just 5 years ago. The jump could be due to the average amount borrowed, which increased almost 3% in one year alone.

  • What is the average down payment on a car loan?
    Drivers are putting down an average of $3,687 on new cars today. This is an almost 12% increase over the last 5 years.

  • What is the average monthly payment on a used car?
    The average used car driver pays $344 per month on a used car loan. This is based on an $18,000 vehicle price with a $2,200 down payment.

  • What is the monthly payment on a $30,000 loan?
    The average $30,000 loan, based on an average 4.31% interest rate on a 60-month loan, is $557. This figure is based on a borrower with good credit. Borrowers who can afford a shorter term pay an average of $681 on a 48-month loan at 4.24%.

  • What is the monthly payment on a $25,000 loan?
    A $25,000 loan for 60 months costs an average of $464 per month. A 48-month loan costs an average of $567 per month.

  • What is the average price of car insurance per month?
    Drivers pay an average of $81 per month for car insurance. This is a total of $982 per year for average coverage.

The Bottom Line

What's right for you - a new or used car? Should you finance the car and for how long should you finance it? Each of these answers depends on your individual situation. Look at the big picture and determine what the car will cost over its lifetime. Sometimes that new car may just make sense if the used car will cost too much in repairs and finance costs.

Sources and References:

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