The True Cost of Owning a Car

You may be looking for a fresh start in 2024. If that includes a new car to drive into the new year, doing your research before getting behind the wheel will be important when it comes to purchasing a new vehicle.

Do you have a long commute or a short one? Does gas mileage matter to you? How much space do you need for passengers? What about all-wheel drive? Consider the tips below to make sure you’re educated and equipped for your trip to the dealership. And while you’re at it, don’t forget to factor in the costs of owning your vehicle once you’ve driven it off the lot.

Purchase Price

This may seem like an obvious tip, but make sure you can afford the car before you buy it. This could mean the sticker price you see on the window at the dealership or the monthly cost you’ll pay if you finance it. Right now, most cars are selling right around the market price, i.e., MSRP or retail value. That’s for a new or used car. After the dealership or seller discusses the purchase price, you’ll also need to consider the taxes and fees that go along with it. Trading in an old vehicle for your new one will help lower your taxes.

Gas

Gas prices vary week to week and year to year. Keep that in mind when you purchase your car. If you’re planning to purchase a large SUV that you’ll be driving frequently—say for instance, a daily commute of an hour each way—you’ll want to factor in the substantial fuel costs involved. Unless you’re driving an electric vehicle, getting from point A to point B requires gas in the tank. So, plan accordingly when you’re choosing a car.

Insurance

If you drive a vehicle, you need car insurance. It’s a requirement at the time of purchase. Insurance rates vary depending on where you live, your driving record, and the age of the person or people who will be driving the car. The type of vehicle you purchase, i.e., a sports car vs. a minivan, could affect the cost of insurance as well. Shop around to see the rates available before you make a decision.

Maintenance

Every car needs a little TLC to keep it running well. It’s less expensive to maintain your vehicle than to play catch up once something breaks. Regular maintenance costs might include an oil change every 5,000 to 10,000 miles, and you’ll need to rotate your tires and consider purchasing new ones about every three years. Clean oil and a clean filter will also help your car run efficiently, lowering your gas expenses. Don’t forget these ongoing costs when considering your purchase.

Hidden Costs

Those express lanes may shorten your commute, but they come at a cost. So don’t forget about the added expense of a toll tag if you live in a place with toll roads. Pay for parking at work? Add that to the list. Want roadside assistance if something goes wrong? That’s another cost. These hidden costs might not sound like a lot, but they can add up.

Tips to Lower Operating Costs

There are costs that can’t be avoided when it comes to owning a car, but one thing you do have control of is how you drive your car and maintain it. Keep your tires inflated so it runs efficiently, and if you want to lower your gas mileage, lower your speed. Go easy on the gas pedal, break gently, and maintain your vehicle. Taking care of it every day will lower your costs in the long run.

If you’re looking to buy a vehicle, PlainsCapital Bank’s consumer lending department can offer tools and information in the buying process. Reach out to consumerlending-plainscapitalbank@plainscapital.com with any questions or fill out the online application on the website.