The Cost Of Car Ownership By State
If you’ve spent time on my blog you probably know I’m not the biggest fan of driving and America’s obsession with cars. There’s the 40,000 deaths it causes every year (more than 100 every day…). There’s the smog and carbon pollution. The immense and wasteful infrastructure costs. The noise, the friggin noise! There’s the unhealthy lifestyles cars promote (ok I’ll stop…).
Oh and of course if you’re a typical American then your car(s) are one of your biggest expenses, and likely delaying your time to financial independence more than you realize.
Enter this article from Huffington Post that ranks all 50 states based on the cost of car ownership over 3 years.
How do they do the rankings? From the article:
GOBankingRates.com analyzed key expenses of car ownership, besides the cost of the vehicle itself. Assuming all U.S. residents pay the average transaction price of $33,543 (according to Kelley Blue Book), the findings reveal that in addition to auto payments, U.S. car owners will pay an additional $11,227 on average to buy and own a car for three years. This amount includes:
- car sales tax and title fees (referred to as “one-time purchase costs” in this study)
- registration fees, car insurance, gas and car maintenance costs (referred to “annual ownership and usage costs”)
So what they’re saying is that these rankings are the cost of ownership not including the purchase itself. However, sales tax (arguably part of the purchase) is included.
If you don’t wish to go to the article, here are the top ten most expensive states to own a car for 3 years and the cost
| Michigan | $15,314.53 |
| California | $14,451.58 |
| Washington, D.C. | $13,561.06 |
| New Jersey | $13,484.11 |
| Florida | $13,210.64 |
| Maryland | $12,925.76 |
| Rhode Island | $12,895.61 |
| Montana | $12,763.74 |
| Nevada | $12,695.68 |
| Washington | $12,612.92 |
And here are the ten cheapest states to own a car for 3 years and the cost:
| New Hampshire | $8,098.00 |
| Missouri | $9,280.24 |
| North Carolina | $9,447.94 |
| Wisconsin | $9,570.90 |
| Ohio | $9,595.07 |
| Virginia | $9,602.97 |
| Oregon | $9,696.00 |
| Alaska | $9,813.85 |
| Maine | $9,866.27 |
| New Mexico | $9,923.26 |
As you know, I’m a map dork. It’s just better to see all of data on a map, especially when it’s geographically focused data. So I put the data in my super-duper flux capaciter magical mapping machine. And here’s what it spit out:
If we take the difference between the highest cost state (Michigan) and the lowest (New Hampshire), it’s 7,216.53. That’s $7,216.53 more to own a car for three years in Michigan versus New Hampshire.
Over a decade that difference would be $24,055.10. Yikes. And you could have been investing that $24k and turning it into much much more.
One of the factors in the data from the Huntington Post article is gasoline taxes. Since I’m always on the hunt for this stuff, I found that data too.
Gas taxes can have a real impact over time, especially if you drive a lot. Let’s say you drive 16,000 miles a year – the American average is 12,000. The average fuel economy for vehicles in America is 23.6 miles to the gallon, which is so low it makes me vomit a little in my mouth. Yeah, we love our 7-ton SUV’s. So let’s get numbery.
16,000 / 23.6 = 677.97 gallons of gas used in a year.
The difference between the gas tax in South Carolina (16.75 cents a gallon) and Pennsylvania (58.20 cents a gallon) is 41.45 cents a gallon. So…
677.97 gallons * 41.45 cents a gallon = $281.00.
That’s $281 dollars more you’re paying in gas tax by being in PA as compared to SC. Do this for 10 years and you’re out $2,810.00.
And once again as a wise investor you’re actually out way more than that since you would have been investing that $2,810 over those ten years, preferably in VTSAX. So it’s likely way more, thousands more.
It all adds up folks. I hope you find the two articles above and the maps helpful, especially if you’re considering a Geoarbitrage move within the USA.
Also be sure to check out my Geoarbitrage Resources Page that has tons of great tools to help you find your perfect location.
I have a love/hate relationship with cars. We currently have two. I’ve been trying to convince my wife to sell hers for years. But with two kids, having flexibility prevents us.
Get those kids riding bikes – better yet, get them ebikes!
Yep, owning cars in Michigan is expensive and driving conditions in winter are less than ideal. Our car insurance structure is quite expensive. We don’t pay anywhere near that cost in money… environmental degradation on the other hand…
And as always awesome maps! Thanks for summarizing this so nicely.
Until I wrote this post I had no idea Michigan was so expensive for cars. Ouch. But you guys are now ebikers, frugal power!
Thanks for the comment!
Thanks for these charts and graphs. Interesting to learn that New Hampshire is such a cheap state to own a car in. I grew up in SC, and I experienced the low gas costs there. But next door, NC, is one of the highest states for gas! So weird. Where we live in NH, it’s difficult to travel by bike in the winter (we live actually in the Appalachian mountains and the snow on the side of the road is intense) but when we move, I’m looking forward to engineering our housing situation so that we are able to bike and walk to most of the places we need to go (and maybe go down to one car? Like Doc G’s wife, my husband is skeptical). Plus, we buy used cars and keep them for a long time. I think that helps as well.
I love NH and am considering retiring there. Do you live near Conway? I’d like to be in or near the White Mountains, so beautiful there and so much to do in both summer and winter.
Yes engineering a life with minimal car use is indeed a great way to live!
Oh California is expensive for yet another reason! Oh goody! lol! One thing I can’t complain about it my commute is super short. 1.6 miles each way. I bike/walk sometimes but I usually drive. I know, I know, but I really do have a good reason. We can talk offline. ha ha.
Cali is just expensive all around, but y’all have other benefits, including some of the most amazing natural landscapes in the country. I would never shame a person near L.A. who doesn’t bike, your infrastructure is totally car-centric an hostile towards bikes.
Virginia gets even cheaper if you drive paid for beaters that have an assessed value of less than 1k. At, or below, that point, your annual personal property tax is forgiven (actually covered by the Commonwealth). It’s hard to find cars of little value that still run and are reliable, but they are out there!
Yes! For a while in my early 30’s I had a Ford Aspire (yep..) that was valued under $1k. No pp tax and the thing still got me 32 mpg. Then one day on 395 the clutch handle just broke off in my hand while I was shifting. Needless to say, she was done!
Great strategy Brian!
This state by state analysis has another benefit for us. We take our travel trailer on long trips sometimes. When we cross the border from California into Arizona, for instance, instead of “Welcome to Arizona” we see a huge neon sign with the gas prices that makes us certain we’ve entered another planet (travel is great!). Also, California raised it 12 cents/gallon in November, so I am guessing we are actually “ahead” of Michigan. We “win”!
I didn’t even think of the value to the nomadic folks as much as full geoarbitrage but you make a great point. I’ll let you in on a secret, I have some plans for this type of stuff going forward, I just have to execute and do it!
Susan, you beat me to the comment about the recent increase in CA gas tax. We are a two-Prius household, and my husband gets mileage reimbursement, so we’re pretty blase about the gas prices here generally. But even I’ve been noticing that the “fuel and parking” category in the budget going up, up, up.
And we once almost ran out of gas on the CA-AZ border holding out for cheaper gas. We made it to the pump, but that would have been penny-wise, pound foolish for sure.
I have been tracking all my auto expenses and currently over the past 6-9 months have been working out scenarios for a new full electric. I am looking at the Hyundai Kona mini suv which releases this fall with a 450km charge range. The thought of a monthly payment (lease) and buying new kills me but honestly I’ve done the math and between fuel and oil changes/maintenance I would be roughly paying the same per month. (keep in mind fuel is leaps and bounds more expensive in Canada) Great work on this article by the way, I think I could go carless but for where I live and my time in the backcountry so much I don’t know how I would get to those places.
I had never even heard of the Kona, but wow, that’s a pretty respectable range! My old Ford Focus station wagon had a small gas tank and only got a tad more than that.
You bring up a great point about folks like us who need to get to the mountains or backcountry for pleasure and peace of mind. We really can’t go carless. But that’s okay, while I HATE driving near cities and suburbs, I actually do enjoy driving in beautiful “out there” type places.
This way our outdoor experiences and passion can be as carbon neutral as possible. I have reached out to a couple major manufacturers to see if we can do a test review and story around doing road trips and outdoor adventures with an EV. Hope I hear something back.
That would be cool, that Hyundai would have the range you need too!
i would love to go down to one car. it’s tough in a winter climate to go without one, especially in a smaller city. we sure minimize our driving though. i do like being able to have a budget trip like an airbnb on the carolina coast by just hopping in the car and 12.5 hours later, voila!
Yep, there is something to be said about the freedom and versatility of a car when you really want it. I got up to the Catskills in New York for ice climbing twice this past winter on very short notice. Like you said, quick pack, hop in the car, and bam – 6 hours later I’m in the Catskills.
at the gunks? in new paltz? some boys from my old job near albany used to ice climb there.
We do our ice climbing near the Tannersville area. My buddy from NY has in-laws with a vacation home up there, it’s sweet. There’s some great ice climbing when the ice is in – Asbestos Wall is a favorite and some other obscure formations that we have to hike into. I love it there.
The Gunks doesn’t get ice routes as far as I know as there’s no drainage to freeze coming from the top.
Ugh, I’m in the top 10. Yuck!
That’s ok Tako, I’m pretty sure you’re doing well enough in other areas that it doesn’t matter 🙂
Thanks for sharing this great article
The indepth discussion of details was really helpful
Keep up the great work!!
You’re welcome!
Ouch. Washington makes the top 10 thanks to the $54B levy passed recently to fund our light rail system. I’m all of alternative transportation, but I have lots to say for why I don’t think this was the best way to go about it.
I didn’t know about that, is it light rail for Seattle only?
To start with, but it should cross the lake in the next 5 years.
It’s always funny seeing California near the top of the ranks on these charts. It’s also no surprise that a lot of the northeast states near NY have a high cost of car ownership since there’s a lot of money around there too. Surprised that Michigan is so high though.
Yep, Cali just ain’t cheap no matter how you shake it. But as I mentioned to others it has many upsides as well
I’ve been living without a car for years. In major metro areas in the US, it’s pretty easy and definitely affordable these days. I did a little breakdown about my decision making process and the costs involved for selling my car and taking Uber and Lyft everywhere. I hope you find it interesting and/or useful! https://thesterlingreport.com/sell-car-take-uber-lyft-everywhere/
I would add that having a bike in a major metro area is, to me, the best way to go. It’s faster than walking, and cheaper than Uber etc, plus you get exercise and with a rack can carry quite a bit. Best of all worlds!
Yep! I used to have a bike in SF, but I do not feel safe riding a bike in SF. There are only a few protected bike lanes and there are a few reports every week of bicyclists getting hit (usually hit and runs). If I was living somewhere else, I’d be all over it.
So sad, about the hit and runs. Cyclists are treated as non-humans by many, or at least annoyances. The same people who probably claim they’re concerned about global warming will be the first to honk at the cyclist and buzz them too close, speeding by.
its informative details, thanks for this chart. That’s the reason love your post.
Thanks!
Oregon is not bad for the west coast. We don’t have sales tax and the license and registration is not too expensive. I think we pay every 2 years for registration. We only own one car so the cost of ownership is minimal.
It’s a lot more expensive in CA and WA.
Yep, you guys are white on the map, lowest category. And your gas tax is lower than the surrounding states too.
Your state is very attractive to me as a retirement option!
That’s why this Pennsylvania resident minimizes driving through well-planned trips rather than haphazard travel, bikes where he can (which used to be a lot of places and will be again, but temporarily is not very much due to dangerous roads needed to leave the neighborhood), and will be a one-car household as soon as work schedules permit!
PA wasn’t too high overall but that gas tax is ridiculous! Hope you can get back on the bike soon – best way to go!
Gas is so expensive here in the SF Bay Area that anything under $3 a gallon for gas is a bargain and drivers will flock to gas stations at that price. Right now the Costco here has regular unleaded at $3.30 per gallon and that’s the cheapest one around here.
I have a prius and drive around 7,500 miles last year. So I probably spend around $500 the last year on gas which is really good around these parts. But with gas over $3/gallon, that will project to $700 this year.
Wow, $3.30 is high. I drove almost exactly 7500 miles last year with a Subaru Outback but might be spending less on gas than you due to much cheaper prices.
Great post. People need to see this stuff in black and white and keep hearing this message. And its not just huge financial benefits by giving up this car dependence mentality….life is just so much better when you don’t spend much time in a car. Less presence of a car in your life can free up a huge chunk of money, but it can also mean effortless weight control and better health (if you’re walking or biking instead of driving, or walking to a train, etc). I know many developers are aiming for more walkable communities, hopefully we see more of that….its just smart for everyone.
I agree 100%! If you saw some of my other posts I bike about 5000-6000 miles per year. Most of that is fitness riding and racing, but I do quite a lot of grocery getting and putzing around to the library etc. It’s the best way to travel and never ceases to make me feel like a kid. And I need that at my age 😉
Thanks for the kudos Jean!
The numbers I’ve seen for average cost of car ownership are actually significantly higher than these numbers. My wife and I share one car, hoping we can keep it that way even when we move back to the US.
Was it Mr. Money Mustache who had the quote “Biking saves you money and runs on fat; driving costs you money and makes you fat”? So true.
Mr. Money Mustache did a post with numbers, but not by state. I think he went deeper into the maintenance costs and opportunity costs than the Huff Post article did.
And that bike quote is a t-shirt favorite for cyclists 🙂
Sometimes I feel like this planet has two species of people. The ones that loves their car and the ones that don’t. It’s confusing to me when I read people’s budget and they’re wanting to cancel Netflix when the glaring problem is their car $$$. It’s weird, it’s like brainwashing. $300 for new fluids, $200 for insurance, $300 for payments…but should I eat out less?? And they always say they rent in the burbs but I’m sure cars still make it more expensive than just renting close.
Ha – yes. There’s the car species and the non-car species. Nothing gets people more riled up than cars. So true – cutting out your daily latte isn’t the real problem when you needlessly have a 4 ton Chevy Suburban that gets 15 miles to the gallon!
Net maps! Lucky me in Michigan…
Sorry Amy.. on Reddit a few folks said it was because of a very high chance of hitting deer (so high insurance), and bad rds with winter conditions. But it’s a beautiful state!
Hah the gas tax map explains perfectly why on family vacations if we needed gas we’d only fill up with enough to get us over the NC border and then to our usual spots in VA or SC that were always MUCH cheaper.
Absolutely unsurprised DC is so high up there. I just got a new car insurance policy that to me is MUCH cheaper than what I’d been paying. Surprise, surprise, it’s still way more than what I’d probably be paying if I lived in VA. Good thing I own a very old, very cheap car!
Everything in DC is way higher than VA, but for folks who want a real urban experience, NoVa doesn’t really deliver
Helpful article, thank you for putting this together!
Glad you enjoyed it Seth, thanks for reading!