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Do you have any idea how much that new car you just drove off the lot really costs? Probably not. That’s because the cost of a new car includes much more than just its sticker price.
Everything from average fuel costs to yearly depreciation to taxes and financing charges add to the final cost of a new car.
If you’re shopping for a new vehicle, it’s important for you to know just what additional costs you’ll be incurring when you take over title. In many cases, these extras can boost the cost of your new car by more than $20,000.
Some of the factors that add to your new car’s real cost include the amount of interest you’ll pay when financing your car, state registration fees, insurance costs, maintenance and repair, fuel costs and depreciation.
Depreciation is actually a big factor. Most cars depreciate quickly once you drive them off the lot. It’s important to factor in this lost value as an actual cost.
Here’s a look at how these additional costs work. Say you’re buying a 2010 Ford Fusion. The manufacturers’ suggested retail price is $21,004. But when you take into account all the hidden costs of buying a car, that Fusion will actually cost you $41,171. And after five years, it will be worth just $9,840.
That’s because it costs an average of $2,973 in interest and other fees to finance the 2010 Ford Fusion. It costs $681 for state and registration fees, $6,595 to insure the vehicle for five years, $2,263 for maintenance and repairs over a typical five-year period and about $7,655 to keep the car fueled for five years. Then there’s depreciation: During a five-year period, the 2010 Ford Fusion loses $11,164 in value.
If you’re buying a Hyundai Sonata, you’ll pay a total cost of $41,306. After five years, the car will be worth just $9,549.
Here’s a closer look at the costs of buying this car: The initial price tag for the 2010 Sonata comes in at $21,691. You’ll have to add $2,916 in financing costs, $636 in registration fees, $6,135 in five-year insurance costs, $1,859 in maintenance over five years and $8,089 in fuel costs. The vehicle will also lose a total of $12,142 in value over five years.
The 2010 Chevy Malibu will cost you a total of $41,684. And after five years, it will be worth just $7,654. The suggested retail price of the Malibu is $21,800, while it costs $3,165 to finance it and $667 for its registration and state fees. You’ll pay $5,960 in insurance over five years and $1,750 on maintenance and repairs during the same period. Fuel costs will run you $8,342 over five years, while the vehicle will lose $14,146 worth of value over five years.
Other cars perform better. The 2010 Toyota Corolla, for example, will cost you a total of $40,484, and will be worth $16,058 after five years. This car comes with a $21,800 price tag and $2,398 worth of financing costs. State fees will run you $630, while five years of insurance will cost $6,245. Maintenance and repair will cost about $2,193 over five years, while gas will come in at $7,218 after five years. The Corolla will have fallen $5,742 in value after five years.
Finally, the 2010 Honda Civic also performs reasonably well. It will cost you $40,640 total to buy, and be worth $16,072 after five years. The initial price tag for this car comes in at $21,800, while the financing costs are $2,345, registration and state fees $628, insurance for five years $6,940, maintenance costs for five years $1,791 and fuel costs for the same time period $7,136. The car will only depreciate, though, $5,728 after five years.
Buying a new car can be an overwhelming process, what with there being so many different models from which to choose. But keeping the total costs and the five-year worth of potential cars in mind, you’ll increase your odds of choosing the car that’s best for you and your wallet.
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