When you are shopping for a new vehicle, it is important to look at the cost of ownership. This cost is the amount of money you will need to spend to operate the vehicle. This number can vary greatly between models and makes, but it is one of the most important figures to look at before buying your next car of truck. This number is available from certain sources, but for best results, you should make your own calculations. The following is the approach you should take to arrive at these numbers.
Decide on the type of vehicle you want
There are a range of obvious choices in broad categories. Examples include trucks, SUVs and sedans, but you need to focus on a narrower group of vehicles. If you are looking for a sedan, you need to consider the size of the car. You can usually look at large, mid-sized and compact sized cars. Some manufacturers will have what is known as a sub-compact car. This will be the size smaller than their compact size, and is made for those who want the highest gas mileage possible. Not all manufacturers offer all sizes of cars.
List the models of interest and make calculations
Once you have the type of car you are interested in, you need to write down the model or models that are offered by each car maker. With this list, you can begin to look at the cost of ownership of each model.
Calculating the costs
There are four main factors you will need data for: depreciation, gas, insurance, maintenance and repairs. Depreciation is easy to find. Simply look at the current prices for each model of used car that is five years old. Using five years is a good comparison, as most of the depreciation will have occurred after this time.
Insurance is straight forward; you simply request quotations for full coverage of each model of car. Gas mileage is provided by the dealerships. Repair and maintenance costs can be the most difficult, but there are non-profit consumer agencies who provide good dollar estimates.
A second method
An alternative approach, for those who have a fondness for a particular car maker, is to first look at the cars you would consider owning, and then compare the cost of ownership. For example, you could look at the toyota model cost of ownership numbers for vehicles of interest, but whichever approach you take, cost of ownership should always be considered before making your purchase.