Car Ownership is 167% More Expensive Than Most People Think

Owning a car has never been cheap, but many drivers may be underestimating just how much it really costs. A new survey suggests Americans are missing the mark by thousands of dollars each year when calculating what it takes to keep a vehicle on the road.

According to Synchrony’s Cost of Car Ownership study, drivers believe they spend about $2,738 annually on running their vehicles, not including loan or lease payments. The reality is far higher. The survey found the average annual cost of operating a car comes in at around $7,303—roughly $4,565 more than many owners expect.

In other words, the true cost of driving may be more than double what people think.

Fuel, Insurance, and Maintenance All Add Up

Fuel and insurance make up the largest portion of that yearly spending. On average, drivers spend about $1,956 per year on gasoline and roughly $1,730 on insurance premiums. While fuel prices fluctuate, those two categories alone account for nearly half of the average ownership costs reported in the study.

Maintenance and repairs also add up quickly. Routine maintenance averages about $622 annually, while repairs contribute another $659. Tires account for about $377 per year, and accessories or replacement parts add another $240.

When smaller expenses such as tolls, parking fees, and car washes are included, the total cost climbs even higher. What many drivers initially view as minor expenses can quietly add hundreds—or even thousands—of dollars to the yearly cost of owning a vehicle.

Costs For Young Drivers

The financial impact appears to be even greater for younger drivers.

Synchrony’s research found that Millennials spend an average of $10,101 per year maintaining and operating their vehicles, while Gen Z drivers spend around $9,984. Both figures significantly exceed the overall average.

Younger drivers also report higher spending in several categories. For example, Gen Z drivers spend about $976 annually on maintenance and roughly $983 on repairs. Millennials report spending about $768 on maintenance and $931 on repairs—both higher than the general averages.

Monthly fuel costs follow a similar pattern. Millennials average around $207 per month on gasoline, while Gen Z drivers spend about $193. The overall average across all drivers sits closer to $163 per month.

Vehicles Per Household On The Decline

Beyond higher usage costs, the study also points to a shift in how many vehicles households maintain. Multi-car households appear to be declining as ownership costs rise. About 65 percent of respondents said they are responsible for just one vehicle, while only 25 percent reported managing two.

That trend contrasts with earlier census data showing that multiple-vehicle households were more common in previous years, suggesting some families may be cutting back as costs rise.

Other research suggests the total cost of car ownership may be even higher when bigger financial factors are included. AAA’s 2025 Driving Costs study estimated the average cost of owning a new vehicle at $11,577 per year once depreciation, financing, fuel, insurance, and maintenance are all factored in.

While that number represents a slight decline from the previous year, it still highlights the substantial financial commitment required to own and operate a vehicle in today’s market.

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