Owning a Private Car: Expense Analysis



Owning a car is one of the most prestigious things that people enjoy. The comfort and the conveniences of using private means of transport are enormous so that people can forget the associated expenses. Firstly, private transport eliminates the worries of getting late for work and meetings as one will not have to adhere to the public transport departure time.

With a private car, people can travel to wherever and whenever they want. The comfort of traveling with family members during vacations is one of the best feelings of having a personal car.

There is the freedom of driving from door to door without any delays or without necessarily adhering to the private transportation routes (Braverman et al., 2012). However, every good thing comes with a price as the purchase and maintenance of a private vehicle are quite costly. The expenses of owning a private vehicle comprise of annual spending and costs per mileage.


Owning a private car is prestigious; however, it is associated with a number of costs. This paper will give a stringent analysis of the expenses incurred because of owing a private vehicle with an initial purchase price of $20,000. Firstly, in Massachusetts, there is a sales tax rate of 6.25% on a new vehicle (Breed, 2011).

Therefore, 6.25% of $20,000 is $1,250. This amount makes the initial purchase price rise to $21,250. Moreover, the purchaser was only able to pay 20% of the amount. The balance was financed over a period of five years, where the total financing cost amounted to $2,400.

The total cost of the vehicle is about $21,250+$2,400= $23,650. At the end of a five-year period, the vehicle is anticipated to have a scarp value of $3,500. Therefore, the net cost of the vehicle is $23,650-$3,500=$20,150.

Other than the net cost of the vehicle, there are annual and mileage costs. Astringent analysis of the initial costs, annual expenses, and the mileage expenses for a period of 5 years will help in making a decisive decision of whether it is worthwhile to purchase the personal vehicle or to use public transport.

Annual expenses

Owning a personal vehicle comes with the annual costs listed below.

1) Annual registration fees of $100. For the five years, this will amount to $100*5= $500.

2) Annual inspection fees of $60 amount to ($60*5) = $300 for five years.

3) The average annual excise taxes are estimated to be $160. This would amount to $160*5= $800 for a five-year period.

4) The annual cost of parking and tolls is $3,000, therefore, for the same period; parking fee amounts to $ 3000*5= 15,000.

5) Annual auto insurance is $2,000 for five years, while the auto insurance fee will amount to $2,000*5= $10,000. In addition to the annual auto insurance fee, the car owner is expected to pay an insurance deductible fee of $500. The car is expected to be involved in at least one minor accident over the next five years. Therefore, the total insurance fee is $10,000+$500= $10,500.

Expenses per mileage

Apart from the annual expense, the vehicle must undergo some expenses that are at par with the mileage (Chase, 2005). The vehicle is expected to cover 15,000 miles per year. Therefore, for five years, the vehicle will cover 75,000 miles. The costs per mile coverage are as summarized below.

1) Gasoline is estimated to cost $3.50 per gallon, where the car gets an average of 25 miles per gallon. Therefore, for 75,000 miles, the vehicle will need (75,000/25) = 3,000 gallons of gasoline. The total cost of gasoline needed will amount to 3,000*$3.5= $10,500.

2) Tires cost $200 each and must be replaced after every 35,000 mileage. This means that the owner will change tires after reaching the 35,000th mileage and the 70,000th mileage. In five years, the car owner will change tires twice. Assuming the vehicle has four tires, the total cost for tires for five years will be (4*200*2) = $1,600.

3) Oil changes after every 3,750 miles amount to $55. To cover 75,000 miles, the owner will change the oil 20 times, where (75,000/3,750) = 20. Therefore, the total cost for oil changes reaches $55*20= $1,100.

4) Minor tune-ups are necessary after the vehicle covers 15,000 miles. Upon reaching 75,000 miles, the car owner will take the car for minor tune-ups at least five times, (75,000/ 15, 000= 5). With every minor tune-up costing of about $300, the total cost for minor tune-ups for five years will amount to ($300*5) =$1,500.

5) Major tune-ups are necessary after every 30,000 mileage. The owner of the vehicle will have to take the vehicle for major tune-ups services after the 30,000th mile and after the 60,000th mile. Each of the major tune-ups costs about $600. Therefore, in a five-year period, the total cost for minor tune-ups will rise to ($600*2) = $1,200.

6) After every 20,000 miles, the vehicle goes for wheel alignments, brakes, and suspension repairs. Therefore, the owner will take the vehicle for the mentioned services after the 20,000th, the 40,000th, and the 60,000th mileage. Each of the services costs about $250; therefore, in five years, the owner will spend ($250*3) = $750 on wheel alignments, brakes, and suspension repairs.

7) There will be a need to replace the muffler every 36,000 miles at the cost of $200 each. The muffler will be replaced after the 36,000th mileage and after the 72,000th mileage. Therefore, in five years, the car owner will spend ($200*2) = $400 on replacing the muffler.

Other expenses

The car owner will need to purchase a new battery every three years (Eldridge, 2011). In the five years, there will be a need to purchase a new battery after the third year at the cost of $100.

Other repair work, such as repairs of the electrical system, alternator, windshield wipers, and the bulbs, is expected to amount to $750 over the life of the vehicle. After five years of usage, the vehicle will be considered unusable. Therefore, the amount of $750 for repairs is spread over the anticipated lifetime of five years.

Budgeted cost per mile

The summary table below will help in calculating the cost of purchasing, owning, and driving a personal vehicle over the analyzed five years. Essentially, the figures indicated the account for coverage of 75,000 miles.

Type of cost Amount ($)
Net cost of vehicle 20,150
Total annual expenses
Registration fee 500
Inspection fee 300
Excise tax 800
Parking fee 15,000
Insurance fee 10,500
Total expenses per mileage coverage
Gasoline 10,500
Tires 1,600
Oil change 1,100
Minor tune-up 1,500
Major tune-up
Wheel alignment
Muffler replacement
Other expenses
New battery 100
General repairs 750
Total 65,150

From the table above, the budgeted cost per mile of purchasing, owning, and driving a personal vehicle over the five years is (65,150/75,000) =$0.86. Although the cost is inclusive of the maintenance costs, it is far much expensive because people have invented new ways of minimizing their public transportations expanses. Supposedly, a person commuting for 24 days per month spends $4 for a two-way journey.

The amount spends on commuting will total to $96 per month. This person can decide to buy a monthly public transport pass that costs about $60 to save $36 per month. From this aspect, it would be far much cheaper to use public transport than to drive a private vehicle.

So far, this paper has based its discussions on the cost of owning and maintaining a personal vehicle. To make a decisive decision on whether it is indeed worth owning a car or not, we will consider two other factors, the time and convenience of the alternative means of transport as compared to the use of a private vehicle.

To illustrate the advantages of using a personal car over the other means of transport, we have taken a person who commutes every day. A car and a bus would take approximately the same time to cover a mileage as long as there is no traffic. However, driving a personal car offers more convenience as there is no need to wait for public transport’s departure time.

Therefore, people with personal cars can commute to any place at a convenient time. A plane, for example, takes the shortest time possible; however, a traveler will have to spend a lot of time going to the airports.

The passengers have to meet the costs of ground transport using the airport buses or the taxis that are quite costly. It is also noteworthy that people who drive their personal cars do not undergo security inspections that are very common in many public transport systems.

On the other hand, private transportation is associated with a number of disadvantages as compared to the other means of transport. A four-hour drive, for example, is quite long. It would give the commuters some adequate time to walk around, browse, take a nap, snack, and even socialize with their neighbors. Public transport, especially when using a train, comes with a lot of comforts because people can plug their laptops and respond to emails.

In fact, luxury buses have Wi-Fi, and travelers can even watch a movie as they travel. However, a person who is driving a personal car has to be alert at all times to watch for the traffic. Moreover, people who are driving their personal vehicles will have to undergo the hassles of parking their cars whenever they want to do something.


From the discussions, it is evident that it is very costly to purchase and maintain a personal vehicle. However, if the convenience that comes with driving a personal car is worth paying for, then one can consider having one.

It could be expensive to own and maintain a personal car, but it all depends on the economic value that is associated with it (Stouffer, 2012). For people who value time and comfort more than money, personal vehicles can serve right. However, the best alternative is purchasing a personal vehicle and using it whenever it is convenient.


Braverman, B., Mangla, I., Asher-Ejiofor, Z., Gibbs, L., Lee, A. C., Poppick, S.,…Yahalom, T. (2012). Cars. Money, 41(5), 85.

Breed, C. (2011). Highway costs and motor vehicle payments in Massachusetts, Connecticut, Rhode Island. Evanston, Illinois: Northwestern University.

Chase, K.J. (2005). The savvy guide to car maintenance and repair. Indianapolis, Indiana: Indy Tech Publishing.

Eldridge, C. (2011). Motor vehicle maintenance tips. University of Wisconsin Extension Publication. 2944(1), 1-4.

Stouffer, T. (2012). The only budgeting book you’ll ever need: How to save money and manage your finances with a personal budget plan that works for you. Avon, MA: Adams Media.

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