Yahoo Finance Cost of Owning a Car for a Year in Every State
When you set out to buy a car, you often only think of initial costs, like down payment, your next month’s car payment and interest the loan might accrue. But you might be surprised to know how much it costs to own a car for just one year. And those costs vary from state to state.
Read Next: Avoid These 10 Cars Likely To Break Down After 100K Miles
Try This: How To Get $340 Per Year in Cash Back on Gas and Other Things You Already Buy
To determine the costs of owning a car for a year in every state, GOBankingRates surveyed and totaled the cost of buying and owning a car for one year in all 50 states. This total included: car sales tax, average annual car insurance premiums, average annual gas expenses and average car maintenance and repair costs.
These expenses were added to the cost to finance a new vehicle — based on $48,427 MSRP, 20% down payment of $9,649, an average credit score of 716, an interest rate of 6.88% and a loan length of 60 months, which equals $762 per month or $9,144 per year.
So, take a look and see whether your home state has a driving economy that’s making it that much harder to make ends meet or one that allows you to look forward to affordable auto ownership for decades to come.
Alabama
Total costs for one year of ownership: $23,733
Annual gas: $2,033
Average insurance: $1,542
Despite costs being lower in Alabama than other states, the average cost of car repairs here runs on the higher side at around $399 per year. However, gas averages around a reasonable $2.79 per gallon.
See Here: What I Drive and 3 Cars I Steer Clear Of
ChatGPT Unveils: 5 Worst American Cars for Your Money
Alaska
Total costs for one year of ownership: $23,313
Annual gas: $2,774
Average insurance: $1,359
You won’t pay any sales tax on the purchase of your new car in Alaska, which helps lower total costs, but gas is pricier here, at around $3.81 per gallon.
Discover More: 6 Luxury Cars Mechanics Recommend
Arizona
Total costs for one year of ownership: $25,926
Annual gas: $2,425
Average insurance: $1,617
The relatively high sales tax in Arizona — 5.6% — translates to around $2,702 in tax on a new car, which is more than you pay in annual gas.
Arkansas
Total costs for one year of ownership: $25,896
Annual gas: $1,987
Average insurance: $1,597
In Arkansas, you’ll pay only around $2.73 per gallon in gas, and around $383 in repair fees. However, the higher sales tax of 6.5% translates to a whopping nearly $3,150 in tax on your car.
California
Total costs for one year of ownership: $28,253
Annual gas: $3,431
Average insurance: $2,115
California is known for having a significantly higher cost of living than most other states, and it’s no exception when it comes to buying a car. In fact, your total costs for one year of ownership here are the highest of all the states. With a sales tax of 7.25% and gas running around $4.71 per gallon, it’s no surprise.
Colorado
Total costs for one year of ownership: $24,621
Annual gas: $2,071
Average insurance: $1,940
Colorado is on the lower side for sales tax at 2.90%, and gas per gallon, $2.85, but car repair costs are on the higher side here, around $417 per year, which is higher than even California by a few bucks.
Check Out: 5 Used Cars You Shouldn’t Buy
Connecticut
Total costs for one year of ownership: $26,434
Annual gas: $2,408
Average insurance: $1,750
This New England state is one of the priciest to own a new car, with a steep sales tax, at 6.35%, which adds around $3,064 per year to your costs.
Delaware
Total costs for one year of ownership: $23,513
Annual gas: $2,192
Average insurance: $2,137
It doesn’t get cheaper than no sales tax, which helps lower the overall costs you pay for owning a car in Delaware, which is on the lower end of this list.
Florida
Total costs for one year of ownership: $26,819
Annual gas: $2,175
Average insurance: $2,560
Not only are you paying a high sales tax of 6% in Florida, or around $2,900 in total sales tax, but average insurance premiums are the highest here, at $2,560.
Georgia
Total costs for one year of ownership: $26,233
Annual gas: $2,201
Average insurance: $1,647
The state of Georgia, which typically runs lower on cost of living, is not so cheap when it comes to buying a car. Its state sales tax of 6.6% results in a steep $3,184 or so in tax on the car, and car repairs average around $408 per year.
Hawaii
Total costs for one year of ownership: $25,828
Annual gas: $3,418
Average insurance: $1,306
Given that Hawaii is typically the most expensive state in the U.S., it’s surprising that it doesn’t take the top spot on this list for buying a car. Its 4% state sales tax will add up to about $1,930 on a new car. It’s the price per gallon of gas that really takes a bite, at $4.70 per gallon, totaling more than $3,400 per year.
Idaho
Total costs for one year of ownership: $25,706
Annual gas: $2,508
Average insurance: $1,121
The 6% state sales tax will add a sizable $2,895 to the cost of owning a car in Idaho. And the $3.45 per gallon will run you around $2,508 per year.
Illinois
Total costs for one year of ownership: $26,640
Annual gas: $2,391
Average insurance: $1,578
You can expect to pay around $379 on average per year in car repairs in Illinois, but annual gas will run you nearly $2,400 per year.
Indiana
Total costs for one year of ownership: $25,895
Annual gas: $2,104
Average insurance: $1,256
Indiana is another of the states with a strikingly high sales tax — 7% — which adds another nearly $3,400 to your overall car costs. Gas per gallon, though, is on the lower side here, at $2.89 per gallon.
See Here: 30 Items To Reuse or Recycle More Often To Save Money in 2024
Iowa
Total costs for one year of ownership: $24,926
Annual gas: $2,039
Average insurance: $1,321
Even though you will spend close to $25,000 in costs your first year, the cost of gas is only $2.80 per gallon in Iowa.
Kansas
Total costs for one year of ownership: $26,409
Annual gas: $2,029
Average insurance: $1,594
Sales tax is painfully high in Kansas, too, adding up to around $3,619 in costs on your new car. However, gas is only around $2.79 per gallon.
Kentucky
Total costs for one year of ownership: $26,229
Annual gas: $2,051
Average insurance: $2,105
Kentucky’s average car insurance premium is on the higher side at $2,105, and the average cost of repairs is creeping up there, too, at around $385 per year.
Louisiana
Total costs for one year of ownership: $25,852
Annual gas: $1,977
Average insurance: $2,546
Compared to some of these states, Louisiana’s 4.45% sales tax isn’t that high. However, its average car insurance premium of $2,546 is the second highest after Florida.
Check Out: 8 Things I Never Waste Money On
Maine
Total costs for one year of ownership: $25,312
Annual gas: $2,399
Average insurance: $1,116
Maine has one of the lower average car insurance premiums in the U.S. at $1,116 per year. The price of gas, at around $3.30 per gallon, is right in the middle, but its annual car repair cost is on the lower side, at around $349.
Maryland
Total costs for one year of ownership: $26,020
Annual gas: $2,293
Average insurance: $1,640
Prices run higher on the East Coast, and Maryland is no exception. Here, you’ll pay nearly $2,900 in sales tax on your new car in your first year and almost $400 in car repairs.
Massachusetts
Total costs for one year of ownership: $26,155
Annual gas: $2,422
Average insurance: $1,538
You’ll feel the pinch of higher costs on owning a new car in Massachusetts, with around $3,015 in sales tax, almost $2,500 in gas costs and nearly $390 in car repair costs.
Michigan
Total costs for one year of ownership: $26,434
Annual gas: $2,257
Average insurance: $2,133
While the price of gas in Michigan is relatively lower than many states, at $3.10 per gallon, average car insurance premiums are on the high side — around $2,133 per year.
Minnesota
Total costs for one year of ownership: $25,942
Annual gas: $2,142
Average insurance: $1,493
Sales tax is also high in Minnesota, adding around $3,136 to your total car costs, which are already on the higher side than many states.
Mississippi
Total costs for one year of ownership: $25,152
Annual gas: $1,946
Average insurance: $1,606
You’ll pay close to $400 in car repair costs in Mississippi, and nearly $2,000 in gas costs in one year of car ownership.
Missouri
Total costs for one year of ownership: $25,291
Annual gas: $1,974
Average insurance: $2,104
In Missouri, you pay a lower cost of gas, at $2.71 per gallon — or $1,974 per year — but car insurance premiums here are the fourth most expensive in the U.S., at $2,104 per year.
Montana
Total costs for one year of ownership: $23,094
Annual gas: $2,219
Average insurance: $1,692
Car costs are slightly cheaper in Montana, due in part to the lack of state sales tax. However, car insurance premiums are among the highest, at $1,692 per year.
Nebraska
Total costs for one year of ownership: $25,957
Annual gas: $2,117
Average insurance: $2,018
Nebraska will get you with both high insurance premiums and a higher state sales tax of 5.5%. Average insurance premiums are also high, at over $2,000.
Nevada
Total costs for one year of ownership: $28,135
Annual gas: $2,940
Average insurance: $2,023
The second most expensive state for owning a car in your first year goes to, surprisingly, Nevada. This is partly because the sales tax is the highest on the list, at 8.25%, which adds nearly $4,000 to the cost of your car. But gas is also $4.04 per gallon, adding up to nearly $3,000 per year in costs. Average insurance premiums are also steeper.
New Hampshire
Total costs for one year of ownership: $22,799
Annual gas: $2,328
Average insurance: $1,307
Unlike its New England sister states, New Hampshire is the cheapest state on the list to own a car for a year. Average insurance premiums are on the lower side here, and there’s no state sales tax, so even the $3.20 per gallon gas price doesn’t add up to nearly as much in total costs.
New Jersey
Total costs for one year of ownership: $26,614
Annual gas: $2,321
Average insurance: $1,901
Another East Coast state where you’re going to pay more is New Jersey, with a state sales tax of 6.63%, tacking on nearly $3,200 to your car costs. Insurance premiums and car repairs are also on the higher side here.
Find Out: 10 Luxury Items Rich People Won’t Buy
New Mexico
Total costs for one year of ownership: $24,759
Annual gas: $2,138
Average insurance: $1,505
The average cost of gas in New Mexico isn’t bad, at $2.94 per gallon. However, the sales tax of 4% adds almost $2,000 to your total costs, and car repairs average almost $400 per year here.
New York
Total costs for one year of ownership: $25,661
Annual gas: $2,531
Average insurance: $2,020
In a state like New York, with such excellent public transportation, the cost of car ownership is pretty high. Insurance premiums average around $2,000, and the cost of gas adds up to around $2,531 per year.
North Carolina
Total costs for one year of ownership: $24,165
Annual gas: $2,153
Average insurance: $1,368
North Carolina only imposes a 3% state sales tax, or around $1,500 in added cost. The insurance premium is on the lower side, but car repairs are a bit over $400 per year.
North Dakota
Total costs for one year of ownership: $25,162
Annual gas: $2,172
Average insurance: $1,419
North Dakota’s 5% sales tax adds about $2,400 to the costs of car ownership. The average insurance premium is in the middle range, and car repair costs are on the lower side compared to other states, at around $365 per year.
Read Next: 10 Frugal Habits To Adopt Right Away in 2024
Ohio
Total costs for one year of ownership: $24,998
Annual gas: $2,054
Average insurance: $1,023
Gas is on the cheaper side in Ohio, at $2.82 per gallon, running just over $2,000 per year. Average insurance is one of the lowest on the list, and car repair costs are on the less expensive side, too, at about $350 per year.
Oklahoma
Total costs for one year of ownership: $24,489
Annual gas: $1,951
Average insurance: $1,797
While the state sales tax is low in Oklahoma, at 3.25%, the average insurance premium is on the higher side, at almost $1,800 per year. Annual gas tacks on another nearly $2,000 and car repairs are nearly $380.
Oregon
Total costs for one year of ownership: $23,284
Annual gas: $2,853
Average insurance: $1,244
Even with one of the higher average annual costs for gasoline on this list, around $2,853, Oregon’s overall costs of ownership are lower, due to no state sales tax and a lower average insurance premium.
Pennsylvania
Total costs for one year of ownership: $26,066
Annual gas: $2,549
Average insurance: $1,445
Pennsylvania’s cost to own a car for a year is among the highest on this list. The state sales tax of 6% adds nearly $2,900 to your total car costs annually. Annual gas is also on the steeper side, with gas running around $3.50 per gallon.
See Here: 10 Bills You Should Pay Yearly Instead of Monthly
Rhode Island
Total costs for one year of ownership: $26,758
Annual gas: $2,355
Average insurance: $1,845
In keeping with other East Coast and northeastern states, Rhode Island’s costs are pricey compared to many other states. Average insurance is nearly $1,900. The state’s high sales tax of 7% adds almost $3,400 alone in tax costs. And annual gas is nearly $2,400 per year.
South Carolina
Total costs for one year of ownership: $25,561
Annual gas: $2,065
Average insurance: $1,894
South Carolina’s costs are also on the higher side on this list. With one of the higher average insurance costs, and another $2,400 chunk from sales tax, one of the few cost savings here is the lower price of gas, around $2.84 per gallon.
South Dakota
Total costs for one year of ownership: $24,899
Annual gas: $2,217
Average insurance: $1,581
The average insurance premium in South Dakota is on the higher side, at nearly $1,600. The $3.05 you’ll pay per gallon adds up to around $2,217. Total costs, however, are still slightly less than many of the other states on the list.
Tennessee
Total costs for one year of ownership: $25,982
Annual gas: $2,039
Average insurance: $1,373
Tennessee’s 7% sales tax adds around $3,377 in additional costs. While its $1,373 average annual premium is on the lower end, you’ll pay almost $400 in car repair costs.
Find Out: How Much Money Do Americans Have in Their Bank Accounts in 2024?
Texas
Total costs for one year of ownership: $25,985
Annual gas: $1,904
Average insurance: $1,875
In Texas, you may only pay $2.62 per gallon in gas, but you’ll pay on the high end for average insurance, at close to $1,900 per year. Additionally, the 6.25% sales tax tacks on around $3,015 to your car ownership costs.
Utah
Total costs for one year of ownership: $26,131
Annual gas: $2,162
Average insurance: $1,469
You’ll be paying a sizable chunk in sales tax — around $3,305 — and almost $1,500 on average for insurance in Utah. Average annual car repairs are also on the high side, at a bit over $400 per year.
Vermont
Total costs for one year of ownership: $25,706
Annual gas: $2,485
Average insurance: $1,158
The average price of gas in Vermont, $3.41 per gallon, adds up over the year, to $2,485. And the 6% sales tax adds another sizable chunk of $2,895.
Virginia
Total costs for one year of ownership: $24,727
Annual gas: $2,209
Average insurance: $1,321
Though Virginia is among the states on the lower end of total overall costs, you will spend a chunk of change on the cost of gas, which is $3.03 per gallon, or $2,209 per year. Average insurance premiums are on the lower side, but annual repairs are over a tad bit over $400.
Learn More: Always Buy the Cheapest Version of These 10 Things
Washington
Total costs for one year of ownership: $26,805
Annual gas: $3,112
Average insurance: $1,371
Washington state is another one where you’ll feel the sting of a higher sales tax. The 6.5% sales tax adds around a $3,136 chunk to your overall car costs.
West Virginia
Total costs for one year of ownership: $25,960
Annual gas: $2,278
Average insurance: $1,610
You’ll pay around $3.13 per gallon for gas in West Virginia, or almost $2,300 in annual gas costs. With a high average insurance premium, West Virginia is definitely not the cheapest state to own a car.
Wisconsin
Total costs for one year of ownership: $25,123
Annual gas: $2,057
Average insurance: $1,499
While Wisconsin is on the lower end for average annual car repair costs, at around $361, you will pay a higher insurance premium here, as well as over $2,400 in sales tax.
Wyoming
Total costs for one year of ownership: $26,029
Annual gas: $2,207
Average insurance: $1,736
Wyoming is one of 17 states where your total annual costs for owning a car for a year runs over $26,000. With a 6% state sales tax, a high insurance premium and gas running you $3.03 per gallon, be prepared to fork out a fair amount of cash here.
Methodology: To generate these rankings, GOBankingRates surveyed and totaled the cost of buying and owning a car for one year in all 50 states. This total included four key car expenses: (1) Car sales tax, based on rates provided by PolicyGenius; taxes were based on the average car transaction amount of $48,427 in November 2023 as reported by Kelley Blue Book; (2) average annual car insurance premiums, sourced from CarInsurance.com’s 2023 report; (3) average annual gas expenses, based on an average of historical regular gas prices in each state sourced from AAA’s Fuel Gauge Report on Dec. 11, 2023; the expense was calculated based on the assumption of a driver filling up a 14-gallon tank once a week; (4) average annual car maintenance and repair costs, sourced from CarMD’s 2022 State Repair Cost Rankings. These expenses were combined with the cost to finance a new vehicle — based on $48,427 MSRP, 20% down payment of $9,649, an average credit score of 716 as sourced from Experian, an interest rate of 6.88% as sourced from Experian, a loan length of 60 months, which equals to $762 per month or $9,144 per year — to determine the cost to own a car for a year. GOBankingRates also attempted to calculate for title and registration fees, but with such varying degrees between states’ car excise and personal property tax laws, as well as rules for weight of vehicles, age of vehicles and cost of vehicles, GOBankingRates decided to not to include these fees in its final ranking. All data is up to date as of Dec. 11, 2023.
More From GOBankingRates
This article originally appeared on GOBankingRates.com: Cost of Owning a Car for a Year in Every State
