What Buying a New Car Every 5 Years Really Costs You vs. Driving the Same Car for 15
The average new car costs $49,275, according to Kelley Blue Book. Buy one every five years, and you will spend nearly $150,000 in purchase prices alone over 15 years.
But the sticker price is only the beginning. Here is the math behind why keeping one car for 15 years costs significantly less.
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The Cost of Buying New Every 5 Years
AAA's 2025 Your Driving Costs study puts the total annual cost of owning and operating a new vehicle at $11,577. Depreciation alone accounts for $4,334 of that each year and hits hardest in the first five years, when a vehicle loses the most value.
Buy new every five years, and you reset that depreciation clock three times over 15 years. Each purchase also triggers sales tax, registration fees and higher insurance premiums all over again.
The Cost of Keeping One Car for 15 Years
After year five, depreciation flattens out and the loan usually gets paid off. Two of the biggest costs of owning a car are gone.
Consumer Reports advised drivers to keep a car until it is no longer economical to repair, calling it the cheapest way to drive for most people.
"Many of today's cars will give you an incredible amount of trouble-free miles," said Jake Fisher, senior director of auto testing at Consumer Reports.
Vehicle value is one of the biggest factors in what you pay for insurance, according to the Insurance Information Institute, which means older cars typically cost less to insure than new ones.
How To Make It Work
The average vehicle on U.S. roads is now 12.8 years old, according to S&P Global Mobility. Keeping a car that long is completely normal.
Once the loan is paid off, depreciation and financing costs disappear. Those are two of the biggest expenses in AAA's breakdown. Maintenance costs are likely to rise, but the overall savings are still significant.
Stay on top of maintenance. Consumer Reports recommended dividing a repair bill by the number of months you plan to keep the car. If the monthly cost is less than a new car payment, the repair is almost always worth it.
Set aside a small amount each month for repairs so unexpected bills don't become a reason to buy new. Finding a reliable mechanic you trust also helps. Regular visits mean problems get caught early before they become expensive.
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
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