America’s Least Expensive Places to Own A Car

Depending on where you live, auto insurance can cost an average of as little as $900 per year up to more than $5,000 a year. Auto insurance companies base their rates on more than just age, driving record, and usage. Auto insurance companies also consider the crime rates in any given area, the amount of traffic on the roads, and the probability of fraud. For example, Detroit Michigan, population 1,027,974, is an urban area with a high crime rate. It also has a higher density of traffic than most cities. Because of this, Detroit’s average annual auto insurance premium for liability, collision, and comprehensive is currently around $5,162. At the other end of the spectrum, Eau Claire, Wisconsin (population 98,286), which had a reported 75 car thefts in 2006 compared to Detroit’s more than 5,000, is the least expensive place to own a car. Eau Claire’s average annual auto insurance premium for liability, collision, and comprehensive is currently around $869.

While auto insurance is one the most expensive aspects of owning a car, factors such as maintenance, state taxes, fuel, and even depreciation also affect just how much or how little it will cost to own and operate a car in any given state or city. Maintenance costs vary greatly from state to state as well as taxes, so while a person living in Hawaii will spend around $3,705 in maintenance costs, driver’s living in California could spend roughly $4,335 – a difference of more than $600. Taxes and fees can total several thousand dollars more in places such as Nevada ($4,036) than in places such as Alaska ($538).

Based on auto insurance costs alone, the five least expensive cities to own a car are:

1.    Eau Claire, WI ($869)
2.    Norfolk, VA ($954)
3.    Raleigh, NC ($966)
4.    Bismarck, ND ($989)
5.    Burlington, VT ($1,001)

When we add taxes and fees, depreciation, finance and interest, fuel costs, maintenance, and repairs, the list looks a little different. Please note that the most reliable figures are determined using data collected at the state level. With the exception of the top five or so most expensive cities for auto insurance, data for most cities is scarce. The vast majority of detailed studies have only been done at the state level.

The top ten least expensive states to own a car based on the criteria above include:

1.    New Hampshire (True Cost to Own a Car $47,499)
2.    South Dakota ($49,483)
3.    South Carolina ($49,515)
4.    Oregon ($50,268)
5.    Wisconsin ($50,417)
6.    North Dakota ($50,515)
7.    Massachusetts ($50,970)
8.    Georgia ($51,103)
9.    New Mexico ($51,157)
10.   Ohio ($51,234)

Continue reading for a breakdown of costs by state (top ten).**

1. New Hampshire
Depreciation: $18,305
Finance & Interest: $5,213
Fuel Costs: $13,216
Insurance: $6,507
Maintenance: $3,276
Repairs: $829
Taxes & Fees $250

True Cost to Own Total: $47,499

2. South Dakota
Depreciation: $18,305
Finance & Interest: $5,929
Fuel Costs: $13,308
Insurance: $5,638
Maintenance: $3,633
Repairs: $914
Taxes & Fees: $1,757

True Cost to Own Total: $49,483

3. South Carolina
Depreciation: $18,037
Finance & Interest: $5,338
Fuel Costs: $12,719
Insurance: $8,705
Maintenance: $3,454
Repairs: $855
Taxes & Fees: $407

True Cost to Own Total: $49,515

4. Oregon
Depreciation: $18,316
Finance & Interest: $5,865
Fuel Costs: $13,280
Insurance: $7,885
Maintenance: $3,781
Repairs: $981
Taxes & Fees: $159

True Cost to Own Total: $50,268

5. Wisconsin
Depreciation: $18,282
Finance & Interest: $5,614
Fuel Costs: $13,396
Insurance: $5,956
Maintenance: $4,115
Repairs: $1,061
Taxes & Fees: $1,994

True Cost to Own Total: $50,417

6. North Dakota
Depreciation: $18,305
Finance & Interest: $5,854
Fuel Costs: $13,332
Insurance: $6,645
Maintenance: $3,499
Repairs: $871
Taxes & Fees: $2,009

True Cost to Own Total: $50,515

7. Massachusetts
Depreciation: $18,208
Finance & Interest: $5,487
Fuel Costs: $13,240
Insurance: $6,640
Maintenance: $3,300
Repairs: $812
Taxes & Fees: $3,283

True Cost to Own Total: $50,970

8. Georgia
Depreciation: $18,037
Finance & Interest: $5,712
Fuel Costs: $13,202
Insurance: $6,355
Maintenance: $3,666
Repairs: $914
Taxes & Fees: $3,217

True Cost to Own Total: $51,103

9. New Mexico
Depreciation: $18,229
Finance & Interest: $5,916
Fuel Costs: $12,765
Insurance: $6,940
Maintenance: $4,055
Repairs: $1,036
Taxes & Fees: $2,216

True Cost to Own Total: $51,157

10. Ohio
Depreciation: $18,174
Finance & Interest: $5,814
Fuel Costs: $13,311
Insurance: $7,019
Maintenance: $3,663
Repairs: $914
Taxes & Fees: $2,339

True Cost to Own Total: $51,234

Sources

**Forbes: http://www.forbes.com
Insurance Information Institute: http://www.iii.org/