About the Car Total Cost of Ownership Calculator
This car total cost of ownership (TCO) calculator adds up everything a car really costs over the years you keep it — not just the monthly payment. It combines depreciation (the value you lose), loan interest, sales tax, fuel, insurance, maintenance and repairs, and registration fees, then shows the total, the cost per year, per month and per mile.
Use it to compare two cars you are considering, to decide between a cheaper used car and a newer one, or to check that a car fits your budget once running costs are included. A car with a lower price can easily cost more to own if it burns more fuel, costs more to insure or loses value faster.
Depreciation uses a first-year rate and a steady yearly rate afterwards. Loan interest counts only what you pay during the years you own the car; if you sell before the loan ends, the remaining balance is repaid from the sale. Sales tax is charged on the full purchase price and treated as paid upfront, and running costs are held flat in today’s dollars.
With the default inputs, the total cost of ownership is $50,375.98. Change any value above to recalculate instantly.
How to use the car total cost of ownership calculator
- 1Enter the price, down payment, loan rate and term.
- 2Enter your sales tax rate and how long you plan to keep the car.
- 3Add yearly miles, fuel economy and your local fuel price.
- 4Fill in insurance, maintenance and registration estimates.
- 5Compare the per-month and per-mile cost across the cars you are considering.
Formula and method
Depreciation is the purchase price minus the estimated resale value after Y years, where resale = P × (1 − d₁) × (1 − d)^(Y − 1). Loan interest is the interest charged month by month on an amortizing loan, counted only for the months you own the car (up to the loan term). Fuel is miles ÷ mpg × fuel price per year.
The down payment and loan principal are not added separately because they buy the car: the part you do not get back is captured by depreciation. Dividing the total by years, months and miles driven gives comparable per-period costs. Costs are in today’s dollars with no inflation.
- P
- Purchase price
- Y
- Years of ownership
- d₁, d
- First-year and later yearly depreciation rates
Worked examples
$35,000 car financed for 60 months, kept 5 years
The car is worth about $14,616 after 5 years, so depreciation is $20,384. Add $5,642 of interest on the $30,000 loan, $2,100 sales tax, $7,500 fuel and $14,750 of insurance, maintenance and fees: about $50,376, or $840 a month and 84¢ a mile.
Paying cash and keeping it 8 years
With no loan there is no interest. The $28,000 car loses about $18,274 over 8 years; fuel is $7,429, sales tax $1,960, and insurance, maintenance and fees $21,600, for about $6,158 a year.
Expensive truck sold after 3 years
Selling early concentrates the steep early depreciation ($20,233) and the interest-heavy early loan payments ($8,332) into just three years — about $16,353 a year or $1.09 per mile.
Frequently asked questions
What is included in the total cost of owning a car?+
The main components are depreciation, financing costs, fuel or charging, insurance, maintenance and repairs, and taxes and registration fees. Parking, tolls and tires are extra costs you can fold into the maintenance or fees fields.
Why is the loan principal not counted as a cost?+
Principal buys the car, which you still own. The part of the purchase price you do not get back when you sell is the depreciation, so counting principal as well would double-count it.
What is a typical cost per mile to own a car?+
For a new car, total ownership costs often land somewhere around 60¢ to over $1 per mile depending on the vehicle, how many miles you drive and how long you keep it. Running your own numbers is more reliable than any average.
Is it cheaper to keep a car longer?+
Usually yes. Depreciation and interest are heaviest in the first years, so spreading the purchase over more years lowers the yearly cost even as maintenance rises. Try changing the years owned to see the effect.
How do I compare an electric car?+
Enter the EV’s efficiency in miles per kWh in the fuel economy field and your electricity price per kWh in the fuel price field — the math is the same. Or use the EV vs gas calculator, which compares both cars side by side.
Results are estimates for educational purposes and are not financial advice. Rates, fees and terms vary — confirm with your lender or a licensed advisor before making decisions.