EstimatorCar Total Cost of Ownership Calculator
The sticker price is the smallest honest number about a car. This adds up everything five years of owning it actually costs — payments, depreciation, fuel or electricity, insurance, upkeep — and reduces it to the two numbers that compare cars fairly: cost per year and cost per mile.
Depreciation is counted the honest way — through the resale value subtracted at the end — rather than charging both the loan payments and the value loss, which would double-count the car itself. Running costs (fuel, insurance, upkeep) are real cash on top. The EV toggle swaps the fuel math to electricity at your home rate; the EV Charging Cost Estimator goes deeper on charging.
How it works
Gross cost = down payment + all loan payments inside the horizon + (fuel + insurance + maintenance + registration + other) × years. True cost = gross cost − resale value, where resale = price × (1 − depreciation)years. Fuel for gas cars is miles ÷ MPG × price per gallon; for EVs it is miles ÷ 100 × kWh-per-100-miles × price per kWh. Cost per mile divides the true cost by total miles — the single fairest number for comparing a cheap-to-buy car against a cheap-to-run one.
Formula & worked example
Formula: True cost = down payment + loan payments within the horizon + (fuel + insurance + maintenance + registration + other) × years − resale value, with resale = price × (1 − depreciation)years. Fuel (gas) = miles ÷ MPG × price per gallon; fuel (EV) = miles ÷ 100 × kWh per 100 miles × price per kWh. Cost per mile = true cost ÷ total miles.
Worked example: The default $38,000 car over 5 years: $67,985 gross − $15,892 resale = $52,093 true cost, $10,419 a year, $0.87 a mile.
When to use this
- Two cars at different prices both 'fit the budget' and you want the real 5-year difference
- You are deciding whether your current paid-off car is actually cheap to keep
- A long commute makes fuel a first-order cost and you are weighing an efficient replacement
- You want the honest per-mile cost to compare against mileage reimbursement or rideshare
How to use it, step by step
- Enter price, down payment, loan terms and how long you will keep the car.
- Set depreciation — conservative (12%) for trucks and Toyotas, higher (18–20%) for luxury and EVs.
- Choose gas or electric and enter your real efficiency and energy prices.
- Add insurance from an actual quote, not a guess — it varies more by driver than by car.
- Budget maintenance by age: low under warranty, rising after year 4.
- Compare cars on cost per mile and cost per year — never on monthly payment alone.
What the inputs mean
| Input | What it is | Typical values |
|---|---|---|
| Purchase price & down payment | What the car costs and how much is financed after your cash in. | Mid-size new car ≈ $35,000–$48,000 |
| Depreciation per year | The value bleed — the largest single ownership cost for new cars. | 15–20% early years; flattens with age |
| Miles per year | Drives fuel cost and the per-mile denominator. | US average ≈ 13,500 |
| MPG or kWh/100 mi | Efficiency in the car's own units; the fuel toggle picks the math. | 30 MPG gas; ≈30 kWh/100 mi EV |
| Insurance / maintenance / registration | The recurring keep-it-legal, keep-it-running lines. | Insurance $1,500–$2,400; maintenance rises with age |
Another worked example
The electric version of the same exercise: a $42,990 EV, $4,299 down, same 6.9% loan, 18% depreciation, electricity at $612 a year, insurance $2,100, maintenance $600, registration $320, tires $350. Gross outlay is $70,067; resale after 5 years is $15,938; true cost $54,129 — $0.90 a mile. More expensive to own here despite cheaper fuel, because the higher price and faster depreciation outweigh the running savings at 12,000 miles a year.
Frequently asked questions
What does the default car really cost over five years?
The $38,000 example: $67,985 of gross outlay, minus a $15,892 resale value, is a $52,093 true cost — $10,419 a year, $0.87 a mile. The purchase price was only 56% of the gross spend; fuel, insurance and upkeep made up most of the rest.
Why is cost per mile the best comparison number?
Because it folds everything into the unit you actually consume. A $25,000 car driven 6,000 miles a year can cost more per mile than a $45,000 car driven 20,000 — the fixed costs (insurance, depreciation, payments) spread over more miles. High-mileage drivers should weight running costs; low-mileage drivers should weight purchase costs.
What is the biggest cost of owning a new car?
Depreciation, almost always — the default car loses $22,108 of value in five years, more than fuel ($6,800), insurance ($9,500) or the loan interest. It is also the cost nobody writes a check for, which is why it is so easy to ignore when buying.
How much cheaper is an EV to run in this model?
At 30 kWh per 100 miles and $0.17/kWh, electricity costs $612 a year against $1,360 of gasoline for the 30-MPG car — before the typically lower EV maintenance. The EV vs Gas Calculator isolates exactly that comparison, including the purchase premium and incentives.
Does keeping a car longer lower the cost per year?
Almost always. Depreciation flattens with age, the loan ends, and the fixed costs spread further — until major repairs arrive. Cost per year typically bottoms out somewhere in years 7–12 for a reliable model, which is the financial core of the "buy and hold" strategy.
🔌 Price home charging on its own
The EV Charging Cost Estimator works out cost per charge, per month and per mile from your battery size and electricity rate.
Should I include the loan interest separately?
It is already in: the gross outlay counts every loan payment, and payments are principal plus interest. Charging depreciation as well as payments would double-count the car — the resale subtraction is what converts payments into the honest ownership figure.
What costs did this leave out?
Parking, tolls, car washes, accessories, and the opportunity cost of the down payment. Add your real ones to the tires & other line. For most drivers they are small next to depreciation, insurance and fuel, but city parking can be a genuine exception.