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College 101

The Truth About Your Car - Its Real Cost
Article Type: Quick and Dirty

Like magicians, circus freaks and Snooki's jaundice-inspired tan, car prices are not always what they seem. You may be fiscally armed and ready to tackle the cost of the car itself, but that's really only half the battle. After that, you still have to fork over cash for titles, taxes, insurance, maintenance, interest you'll pay on an auto loan, gas, future repairs and a landslide of other hidden expenses. Before buying your first ride (and getting stuck with all the surprise costs that go with it), this super useful worksheet will help you tally the real cost of your first car AND price compare one vehicle with another. Even if your parents are helping you pay, realizing that it would take you approximately 8 billion hours of flipping burgers for minimum wage to buy your oh-so-used vehicle will gently remind you to slow down a little when driving and politely ask your friends to refrain from eating cheese fries in your back seat. Here's what you'll pay to buy and drive your car for 1 year.

The Car Itself: ________________________

The biggest and most obvious cost of your first ride is the cost of the car itself. This is how much you'll pay to get the car from the sales lot to your home. If you've already dragged your parents from lot to lot, price comparing with the zeal of a lion hunting gazelles, and you've found the car you're going to (eventually) buy, write the price here. If you haven't started the arduous task of finding your perfect car, use these estimates—$28,400 if you're buying a new car, $23,000 if you're purchasing a nearly new car that's 1 to 3 years old or anywhere from $1,000 to $10,000 if you're buying an older vehicle. Those are the ballpark prices according to the National Automobile Dealers Association, Kelley Blue Book and Cars.com respectively.

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Loan Interest:
(your car price - your downpayment) x .06 = ________________________

If you or your parents are paying cash for the car, you can skip this step entirely. Lucky you! If not, get ready to tack on another expense. According to Bankrate.com, the average borrower purchasing a new car in August 2011 paid about 5.5% in interest for a two-year loan while the average borrower buying a used car paid about 6.5% in interest for a 36 month loan. To make things easier, let's assume that you get an an auto loan for with an interest rate of about 6%. To figure out how many dollar bills that translates to, take the price of your car, subtract the amount you have for a downpayment (the more, the better) and multiply by .06.

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Tags, Titles, Taxes and Fees: ________________________

Even after scoring the loan and buying the car, you still have quite a few more factors to take into consideration. How much you pay in tags, titles, taxes and fees will vary according to your state, what kind of car you buy, where you buy the car and in what county the vehicle is registered. In fact, there's a whole separate calculator for just the TTTF costs available at Carmax.com. In general, the pricier your car and the closer you live to a major city, the higher your TTTF costs. If you're just looking for a rough estimate, plug in $350 if you're buying a car that costs less than $5,000, $750 if the car costs under $10,000 and $1,500 if the car costs less than $20,000.

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Car Insurance: __________________$2,999

Boys, you'll pay more. Ladies, you'll pay less and teen drivers living outside of cities will save some serious dough. Auto insurance for newbies behind the wheel is expensive, mainly because teen drivers are four times more likely to have an accident than older drivers. According to Insurance.com, the average family with a teen driver ages 16 to 19 will pay $2,999 per year in auto insurance. The silver lining is that teens with good grades, a clean driving record and modestly used vehicles will pay less for insurance than their peers.

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Gas: __________________$2,208

If you have a car, you need gas. Bundle.com, a personal finance site, reports that the average American blows $184 per month on gas alone. Before sidling up to the pump, consider starting a car pool.

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Repairs and Maintenance: __________________$3,269

Oil changes, new tires, replacement wiper blades...all of it adds up, plus you need an emergency fund in case your car breaks down. Bundle.com reports that the average American spends about $272 per month on auto expenses. Yikes!

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The Grand Total: ________________________

See that huge scary number? That's how much it costs to buy and drive your car for a year. Fortunately there are things you can do to save on the cost of your vehicle , insurance, maintenance, and all your other high school expenses.

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