True cost of ownership: what a used car really costs
The sticker price is just the beginning. Here's how to estimate what you'll actually spend over the next few years.
It's easy to focus on the purchase price, but the real cost of ownership includes everything from fuel and insurance to unexpected repairs. A "bargain" luxury car can quickly become a money pit.
1. Depreciation
Depreciation is often the biggest cost of owning a car—and it's invisible until you try to sell. Luxury cars tend to lose value faster than economy cars. That 5-year-old BMW might look like a deal, but check what it'll be worth in another 3 years.
2. Fuel costs
A difference of 2L/100km might not seem significant, but over 5 years and 100,000km, it adds up to thousands. If you're doing a lot of driving, fuel economy should be a key factor in your decision.
3. Insurance
Always get an insurance quote before you commit. Sporty models and luxury brands often come with significantly higher premiums. A car that fits your budget to buy might not fit your budget to insure.
4. Reliability and parts costs
Every car needs repairs eventually. The question is: how much will they cost? Parts for German luxury cars can be 3-4 times more expensive than Japanese economy cars. Labour rates also vary, so factor in what mechanics in your area typically charge for your target brand.