How to Calculate your Annual Car Maintenance Budget

June 29, 2019

With every car that you buy comes a routine maintenance schedule. In its pages, you’ll find the interval for most service items your vehicle will need in its lifetime. Oil changes, tire rotations, transmission fluid services, timing belt replacements – there’s a mileage and time interval set out for everything. What it doesn’t mention is what your car maintenance costs will be every year...

You know how much your car payment is and you can get a good idea of how much your car insurance will be. But how much should you budget annually to keep your car running and driving well?

How much on average will you spend over the lifetime of your car?

First, here are three key areas to consider when devising your annual car maintenance budget.

  1. Mileage: Your annual maintenance costs are typically directly proportional to the amount of driving you do. So, the more you drive, the more you will need to spend in maintenance fees, and eventually, repairs. 
  2. Care: The way you treat your car will also have a big impact on maintenance and repair costs. Servicing is important to prolonging your vehicle’s life and keeping repairs at a minimum. But you’ll also need to account for climate, as well as the way you drive. Snow and salt can be hard on a vehicle—as can a heavy foot.
  3. Age: No matter how well you’ve treated your car, it will require more and more upkeep as it ages. The good news is that these will likely be much smaller than the payments you’ve already finished making. But they still need to be accounted for. 

How much does it cost to maintain a car?

In the US, AAA reports that a vehicle owner (whose car meets the 20,000 km/year mark) can expect to pay approximately $1,186 per year in maintenance fees. Comparably in Canada, it could average out to $1,400 to $1,500 per annum. Of course, this can vary depending on the above-mentioned factors and includes major maintenance items like brakes and tires also. While this number is a good place to start, here are some steps you can take to establish a much specific monthly budget.

Step 1: Gather receipts and maintenance records

Receipts and records of your car maintenance costs for the previous 12 months will give you a good indication of how much you should budget for next year. All these receipts are likely to include the costs of any oil changes, tire rotations, and any additional repairs and servicing you have had to pay for.

Step 2: Establish your monthly average

Add up all these maintenance expenses to calculate a total annual amount and divide by 12. For example, if you paid $900 in car maintenance fees that year, then it’s a good idea to set a budget goal of at least $75 a month.

Step 3: Factor in age and condition of the car

Older cars typically need more mechanic attention, so you’ll want to factor the car’s age into that equation. If you paid $75 per month while the warranty was in effect, consider raising that monthly amount from $75 to $125 or even $150 after the warranty has expired to ensure you have budgeted enough for the remainder of the year.

On the other hand, if you have already replaced major vehicle components (like the tires or brakes) in the previous year, it is unlikely that you’ll have to replace them again the following year—so your costs may not be as high as in previous years. In that case, a compromise of $100 per month for your car maintenance budget may be enough to cover these annual costs. 

Establishing your budget isn’t an exact science as there are so many changing variables. And we recommend erring on the side of caution to account for the unexpected. But understanding the above factors can help you plan for what it will cost to keep your vehicle in top form over its lifespan—without breaking the bank. 


Canada Drives has a long-standing history of helping drivers obtain the car loans they need to get behind the wheel of a new car. As you learn more about how to properly budget for the cost of a car, you’ll find that owning a vehicle is more affordable than you thought. Click here to apply with us for free today!

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