The true cost of owning a car
The sticker price is the number everyone focuses on, and it's one of the least important. What a car actually costs you shows up month after month, mostly in ways you never get a bill for.
Skip the math — the free true cost of car ownership calculator runs this from your own figures.
Open the free calculator →Depreciation: the invisible cost
The biggest cost of owning most cars isn't fuel or insurance — it's depreciation, the value the car loses while you own it. It's invisible because no one sends you a bill, but it's very real: you feel it the day you sell or trade the car for far less than you paid.
New cars depreciate fastest in the first few years. The difference between what you pay and what you can later sell for is often the single largest line in the true cost of ownership.
The running costs
On top of depreciation come the recurring costs: fuel or charging, insurance, maintenance and repairs, registration, and tyres. Individually they seem manageable; over years of ownership they add up to a large sum.
These are the costs people think of, and they matter — but judging a car on running costs alone, while ignoring depreciation, understates the real picture.
Why cheaper up front can cost more
A car with a low price but poor reliability or fast depreciation can cost more to own than a pricier, more durable one. Two cars with the same sticker price can have very different true costs once resale value and upkeep are counted.
This is why total cost of ownership, not price, is the right basis for comparing cars — it captures what you'll actually pay across the years you keep them.
Cost per month and per mile
Turning total ownership cost into a per-month or per-mile figure makes it tangible and comparable. It reframes 'this car costs $28,000' into 'this car costs about $600 a month to own', which is the number that actually affects your budget.
Per-mile cost is especially useful if you're weighing driving against alternatives, or comparing a car you'll use a lot against one you'll use rarely.
Compare before you buy
The time to run these numbers is before you buy, when you can still choose differently. Estimating depreciation and running costs for each option turns a gut decision into a clear comparison.
The free calculator below gives you a car's true monthly cost from its price, running costs, and resale value, and the full tool compares several cars side by side.
Questions
How do I estimate depreciation before I buy?
Look at what the same model sells for used at the age you plan to sell it — the gap between the new price and that future used price is your estimated depreciation. Some models hold value far better than others, and that resale strength can outweigh a higher purchase price. Even a rough estimate of resale value, plugged into a total-cost calculation, is far better than ignoring depreciation entirely.
Is leasing cheaper than buying?
It depends on how long you keep cars and how you value flexibility. Leasing spreads the cost of the fastest-depreciating years into fixed monthly payments and hands the car back before big repairs — convenient, but you never build equity and there are mileage limits. Buying and keeping a car well past the loan is usually cheaper over the long run because you own an asset and avoid perpetual payments. Comparing true cost of ownership for each scenario is the way to decide.