How much does your car really cost you each month?
For anyone who budgets for fuel but only remembers the insurance, the roadworthiness test and the tyres when the bills land.
Ask someone what their car costs them and they will give you a fuel figure. It is the only expense you see every week, so it is the only one you remember.
It is also, very often, less than half of the total. The rest arrives in bursts, once or twice a year, and sticks in the memory as something unexpected — even though none of it was unpredictable.
The costs you see
Fuel or charging, and parking if you pay for it. They come round often enough to feel like a running cost, and they are usually the only ones already in a budget.
The costs you forget
They have one thing in common: they come round less often than once a month. That is exactly what makes them invisible to a monthly budget.
- insurance, often paid in one go
- road tax
- regular servicing, and the roadworthiness inspection
- tyres — two sets over the life of the vehicle, rarely set aside for
- repairs outside servicing, which are not accidents but an average
- the loan or lease, if there is one
The cost nobody counts: depreciation
It is the heaviest, and it never leaves your account. Your vehicle loses value every month, and you only notice once, when you sell it.
A car bought for €18,000 and sold for €8,000 six years later has cost €10,000 in depreciation, close to €140 a month — without a single transfer ever bearing that name.
These figures are an illustration: everything depends on the model, the mileage and the market. The principle does not depend on anything. If you leave depreciation out, you are not comparing costs, you are comparing monthly payments.
The method: bring everything back to a month
The calculation takes an hour, once. Go back over twelve months of bank statements rather than your memory — the gap between the two is precisely what this article is about.
- Add up every vehicle-related expense over the last twelve months.
- Add the yearly share of the rarer costs: divide the price of a set of tyres by their lifespan in years, and do the same for major services.
- Add the yearly depreciation: purchase price minus estimated resale value, divided by the number of years you plan to keep the car.
- Divide the total by twelve.
What to do with that figure
First, the surprises stop. Annual expenses become monthly provisions: the day the insurance falls due, the money is already there. You do not pay less, you pay earlier and in small pieces.
Next, comparisons become honest. A second car, a different model, switching to public transport or occasional rental: these trade-offs can only be judged on the full monthly cost, never on the sticker price.
Many people discover at that point that their car is their second-biggest expense after housing. That does not mean they should get rid of it — only that the decision deserves to be made with the full picture.