The True Cost of Owning a Car in 2026 (What AAA, Edmunds and the CFPB Numbers Show)
Short answer: AAA's 2026 study puts the average cost of owning and running a new car in the U.S. at $12,863 a year, or $1,071.92 a month. About a third of that, $4,422 a year, is depreciation, which never arrives as a bill. The loan payment is only one slice, and the loan term decides how big a car a given payment seems to buy.
Most people judge a car by the monthly payment, because it is the number that shows up on a statement. This article walks through the other numbers, using official and published 2026 data. These are national averages, mostly for new vehicles, so your own figures will differ. It is general education, not advice on what to buy.
What AAA says a new car costs in 2026
AAA published its annual Your Driving Costs study on September 15, 2026. For new vehicles it reports $12,863 a year, based on 15,000 miles a year over five years and an average sticker price (MSRP) of $39,376. As reported by CarPro, the pieces are: depreciation $4,422, insurance $2,098, finance charges $1,184, license, registration and taxes $802, fuel 17.3 cents a mile and maintenance, repairs and tires 11.7 cents a mile. At 15,000 miles those last two come to about $2,595 and $1,755. Add the six lines and you land within a few dollars of AAA's total; the small gap is rounding in the published inputs.
Depreciation: the cost that never sends a bill
AAA says the vehicles in its study lost a weighted average of $4,422 a year from purchase to resale. Over its five-year window that is $22,110, and by my arithmetic it is 34% of the yearly total, the largest single line. Nothing leaves your account on the day it happens. You see it when you sell or trade the car. Everything else on the list, about $8,440 a year, sends some kind of bill.
The monthly payment and the loan term
Edmunds' third-quarter 2026 data (published October 1) shows an average new-car loan of $44,664 at 7.0% APR, an average payment of $787, and projected interest of $9,938 over the life of the loan. It also reports that 25.5% of new-car loans ran 84 months or longer, and that 21.2% of buyers had payments of $1,000 or more. Kelley Blue Book's August 2026 report puts the average new-vehicle transaction price at $50,089.
Here is why the term matters. By my arithmetic, a $750 payment at 7.0% APR finances about $31,320 over 48 months and about $49,693 over 84 months, but total interest grows from about $4,680 to about $13,307. The CFPB shows the same pattern with a smaller loan: on $20,000 at 4.75%, interest is $1,498 over three years and $3,024 over six.
| 48 months | $31,320 financed · $4,680 interest |
| 60 months | $37,876 financed · $7,124 interest |
| 72 months | $43,991 financed · $10,009 interest |
| 84 months | $49,693 financed · $13,307 interest |
Negative equity: the old car's debt comes along
Edmunds' second-quarter 2026 report found that 29.6% of trade-ins toward a new vehicle had negative equity, owing on average $6,884 more than the car was worth. Those buyers averaged a $944 monthly payment against $777 for the industry, with a projected $16,270 in interest. In a round-number example of my own, rolling $6,884 into a $37,000 loan at 7.0% over 72 months moves the payment from about $631 to about $748. That is an illustration, not a forecast.
How big is it next to income?
The Bureau of Labor Statistics says the average household spent $13,318 on transportation in 2024, 17.0% of all spending, second only to housing at 33.4%. The Census Bureau reported a 2025 median household income of $87,460. Dividing AAA's $12,863 by that gives 14.7%, roughly 7.6 weeks of pre-tax pay. This mixes a national median with a new-car average, so treat it as a way to feel the size, not as a measure of any one household. Gasoline helps explain the pressure: BLS reports gasoline up 27.4% in the 12 months to August 2026, while new-vehicle prices rose 0.6% and used cars and trucks fell 2.3%.
Three dials the published numbers point to
First, the loan term, as above. Second, what you drive: AAA's cost per mile runs from 61.73 cents for a small sedan to about $1.10 for a half-ton pickup, which is about $9,259 versus $16,449 a year at 15,000 miles. Third, the powertrain: AAA's numbers show hybrids costing less per year than gas models in four categories (medium sedans, compact SUVs, medium SUVs and pickups), while electric medium sedans cost more, partly because AAA says they lose value about twice as fast. Your commute, family and work will change the math, and they should.
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See the guide (PDF) →FAQ
How much does it cost to own a new car in 2026?
AAA's 2026 Your Driving Costs study puts it at $12,863 a year on average, or $1,071.92 a month, assuming 15,000 miles a year over five years. About $4,422 a year of that is depreciation.
What is the biggest cost of owning a car?
In AAA's 2026 numbers it is depreciation, $4,422 a year, about 34% of the total by my arithmetic. It is the one major cost that never arrives as a bill.
Does a longer car loan cost more?
The CFPB says a longer loan can reduce the monthly payment but you end up paying more interest over the life of the loan. On its $20,000 example at 4.75%, interest is $1,498 over three years and $3,024 over six.
What is negative equity on a car?
It means you owe more on the car than it is worth. Edmunds reported that 29.6% of trade-ins toward a new vehicle in the second quarter of 2026 had negative equity, averaging $6,884.
Sources consulted (all opened and read): AAA, "Your Driving Costs 2026" press release (mwg.aaa.com, September 15, 2026) and CarPro's report of AAA's breakdown; Edmunds Q3 2026 financing data (October 1, 2026, via Auto Remarketing); Edmunds, Q2 2026 negative equity press release (July 16, 2026); Cox Automotive / Kelley Blue Book, August 2026 ATP report (September 10, 2026); U.S. Bureau of Labor Statistics, Consumer Price Index August 2026 and Consumer Expenditures 2024; U.S. Census Bureau, 2025 median household income (September 15, 2026); CFPB, "What things can I negotiate when shopping for a car or auto loan?" (accessed October 2026). Loan figures, percentages and the income share are my arithmetic on the published numbers. National averages, mostly new vehicles; your numbers will differ. Educational information only, not financial, tax or legal advice.
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Jairo Oliva Jofer
Digital nomad. Brazilian living in Serbia. Jairo writes honest, no-fluff guides and tells rise and fall stories on the Icarus Paradox channel. See all guides →