How much does it really cost to own a car?

Know what other expenses come with purchasing a vehicle.

If you’ve never owned a car before, it’s easy to imagine that it’s all joy rides and convenient transportation once you sign on the dotted line. However, the cost of purchasing a car is more than the down payment and your subsequent monthly dues. A car can be an investment, sure, but it’s also a source of ongoing costs. Before you purchase a new ride, here are some monetary matters you need to take into consideration:

Registration
In order for you to legally use your car on the road, it needs to be registered with the Land Transportation Office (LTO) and must be insured with compulsory third party liability (CTPL), which covers death or bodily injury to third parties. When your car is brand new, the initial registration covers the first three years. After this, you’ll need to register it annually. Oh, and there are late and penalty fees involved if you don’t.

Average cost of car registration and CTPL respectively: P1,500 and P2,060 per year

Insurance
No one wants to get into an accident, but in the event that one does, it pays to have a safety net. While compulsory third-party insurance is a legal requirement, having a comprehensive car insurance on top of that can save you from a lot of unexpected expenses later on. AXA’s Comprehensive Car Insurance Online provides protection against third-party liabilities, damage, or loss due to theft and natural calamities such as flood, typhoon, and earthquake. In case of an emergency, you can also access 24/7 emergency roadside assistance, and, if needed, file a claim online or through the Emma by AXA app.

Average cost of car insurance: Around P22,000 for a brand new 1.3L sub-compact sedan in its first year

Gas prices
A fast, high-powered sports car with a big engine might seem tempting, but you’ll probably end up spending more time at the gas station than you’d like given our country’s horrendous traffic. Take into account your specific needs and financial capabilities when choosing what kind of car to buy, as this can affect your fuel costs.

Average gas prices: P51 per liter (gasoline), P43 per liter (Diesel)

Regular car maintenance
You might have heard of periodic maintenance service or PMS. As your car’s odometer climbs and it spends more time on the road, certain parts will naturally wear out over time, requiring you to go to a service center for replacements or repairs. Avoiding this process can result in something going wrong (or worse) inside your car, from small things like a bad battery, squeaky brakes and tires, to major electrical and mechanical problems. While some dealerships offer free PMS up to a certain point, you will eventually have to start paying for it on your own.

Average PMS cost: P2,000 to P8,000 per visit
Once you’ve taken all these into consideration, you can finally get that first car! Make sure that it’s maintained well and protected from the unexpected so you can enjoy your investment and drive confidently on the road.