The real cost of car ownership

In trying to break down why my personal expenditure kept going so far over my limit I started examining my major expenses. One of the biggest expenses I have (other than rent) is my car. I compiled the annual expenses of running a car and then broke it down by month and I was amazed what it came to!

It is really an exercise worth doing if you want to keep track of everything you are spending. So the annual expenditure for my car (a 2003 Mazda with only ~60,000 km on the clock which I bought for ~$19,000 in Jan 2010) is:

• Insurance: $1,100 p.a. ($91.66 per month)


• Servicing: $800 p.a. ($66.66 per month)


• Fuel: $2,340 p.a. ($195 per month)


• Cleaning: $360 p.a. ($30 per month)


• Registration: $676.50 p.a. ($56.38 per month)

The variable costs on owning a car therefore come to $5,276.50 per annum or $439.71 per month.

Further this does not include the effective ownership cost of your car. The newer (or higher priced) your car is the worse the depreciation effect and effective cost is higher. For example I did a quick check and my car could currently sell for ~$13,000. So for 26 months of ownership I have paid $6,000. This works out to an extra $230.77 per month giving a total ownership cost of $670.48 per month!

It really is worth doing the math yourself to see how much your car is costing you!