Hi everyone,

Today I would like to talk to you all about the “real” cost of owning a car. Yes, there is a lot of talk of fuel prices and insurance prices being abnormally high and unreasonable, yet there is a great deal of other small car expenses that just as important to talk about. This is my 3rd year of owning my own car and in the past 24+ months of owning a car I have come to realise more and more just how much of a financial burden a typical car may be. Yes, owning a car is very convenient, however, as I see it, it can be an “expensive convenience”. Let’s dive in.

So, I have recently bought my second car. (For those who wish to know what happened to my previous car, please read my blog post here). The initial cost of buying a car is only the beginning of it. There are so many small expenses to think about that it would scare anybody from owning a car. Below I have a list of top 5 expenses that are at the forefront of people’s minds when thinking of buying a car:

  1. Initial cost: This is the initial capital cost of buying a car – paying the dealer and driving the car home. This is possibly the biggest consideration since you are paying large amount of money upfront.
  2. Insurance: You got to have insurance if you want to drive. Insurance expense varies drastically from driver to driver depending on age, experience, no claims bonus, etc. However, it is possibly the second biggest car expense.
  3. Motor Tax: To drive on any public road in Ireland you must pay for Motor Tax. As the saying goes “There are 2 things certain in life: Death & Taxes”, and owning a car is no different.
  4. Fuel: The most common expense. Varies from car to car but very high non-the-less. (Unless you have a hybrid or an electric car)
  5. Maintenance: Your car will need oil, filters, coolant etc. changed on a regular basis to reduce wear and tear and improve performance – Well maintained engine is a happy engine. (I just made that saying up, but its true)

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These 5 expenses are the most common expenses that people consider when thinking about owning a car. However, what about other costs associated with owning a car that only becomes apparent once you start driving. “Some” of these expenses are shown below:

  1. Tolls: Long convenient motorways don’t pay for themselves – unfortunately.
  2. Parts: New wipers, new screen wash, new bulb, new tyres, etc. all of these will need to be replaced at some stage due to wear and tear
  3. Depreciation: This is the most ignored expense. Your car will depreciate in value every day. If you bought a car for €10,000 and drove it for 5 years. Your chances of selling that car for €10,000 again are zero. That car will only be worth a fraction of what you paid for it. That’s just a fact. This is an expense you must consider when buying a car. Some cars hold their value better than other’s.
  4. Parking: If you are going out and about you must put those coins in the parking meter
  5. NCT: Your car needs to past a road worthiness test every couple of years This test is not cheap.
  6. Repairs: In case of car breaking down paying Tow Truck, Garage Labour, Parts etc. will result in a huge bill to pay. However, that’s worse case scenario, but it still needs to be considered.

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As you can see there is a lot of money that goes into owning a car. I am sure I have missed some expenses and if anybody have anything to add to the list above please feel free to comment in the section below. Of course all of these expenses are relevant fro those who have a full licence. Getting a driving licence is a whole different ball game altogether. This is another expense that is very difficult to wrap my head around. However, that’s a conversation for another day.

People always look at the big financial hitters such as fuel, insurance and overall cost, however, there are so many expenses that you will encounter along the way that you don’t even know about. The trap is that these small expenses are paid every now and then.  A fuel top up here, a change of bulb there, parking ticket another time, that we don’t see these expenses add up. If you keep a financial log (explained here) you should be able to add up all your car expenses in a period of time, i.e. a month, and believe me you be surprised on how big of a chunk of your money is going towards keeping your car on the road. Yes, it is convenient to own a car to get you from A to B, but it is very inconvenient for your pocket.

Don’t get me wrong, owning a car is not a “bad” thing. It serves a great purpose in our ever busy society and allows us to get from A to B in a convenient manner. However, this blog was written to just highlight the real cost that goes into owning a car. Before one goes about buying a car, all of these expenses mentioned should be considered. Once they are considered and a plan is put in place to take care of all of the expenses then there should be no issue with buying the car you wish. Just be aware what you are getting yourself into. I own a car and it is vital to  my daily life and I know I can afford it so I don’t mind paying the money to keeping it on the road, however, I am very aware of the expenses and once I feel it is financially ruining me I can pull some of the expenses back. This blog should serve as an awareness of the cost of owning a car, it is not written to dismiss the car completely.

Thank you everyone for reading this blog and I hope for those who don’t own a car this might open your eyes to the real cost of getting one. For those who own a car and don’t consider such expenses I hope this opened your eyes to try and understand how much money you are putting into the car and try and cut back on the expenses where you can. From my recent experience of buying a second-hand car I have made some mistakes as well as made some good decisions. However, I have learned from the experience. If any of you wish for me to write a blog on what to look out for when purchasing a car, please let me know. Although based on my initial experience with the car maybe I am not the best person to ask 😊  I hope this blog will help anyone to understand the true expense of owning a car. I welcome any feedback, comments or additional information that may be useful to me or any of the readers.

Thanks for reading and talk to you all on the next one.

52 Comments

    1. Bridget, I am currently in a process of adding up all my car costs. It will read for a frightful reading that’s for sure. I will see at the end of the year what the figure is.

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    1. Hi Ian,

      That’s just life. We like to live in a fantasy world too much. We need money to survive and a lot of us spend on stupid things that we don’t need and then stuck to pay for things we need. It’s all about change in attitude.

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    1. Hi John,
      I just love within my means and make sure I have money to pay for all the essentials first before I buy anything of luxury. I make expense cuts where I can and just keep and eye on my expenses on a daily basis. It’s a lot of work but it is very rewarding – I have no loans, I comfortable afford expense day to day and I have a money out aside for the rainy day. Money is stressful so I am happy to work hard on it to get rid of this stress. Hope that answers your question.

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    1. It purely depends on the lifestyle Kathy. To me it’s a necessity due to my lifestyle. For others who don’t need a car but think its “cool” to have one, obviously that’s a luxury. However, very few of us can view having a car as a luxury as it is very expensive. If I do don’t need the car I wouldn’t have one. It’s very expensive to have.

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    1. If you don’t need a car but would just “like” to have one then you need to seriously consider the financial burden the car has. That’s simply it in a nutshell.

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    1. Karen,
      Have done both in the past and I strongly recommend paying it off all at once if possible. I used to pay insurance monthly and it felt like I was repaying a loan for 10 months of the year. Every month insurance took a big chunk out of my income. It was hard to plan and it was very frustrating. I pay my insurance with once off payment now. It is had though to pay it once off, as it can be a lot of money. It all depends on your financial status.

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