For most Americans, a car is not optional—it is essential for commuting, family responsibilities, and daily life. But as insurance premiums rise, gas prices fluctuate, and maintenance costs climb, drivers are facing a heavier financial burden to stay on the road. While some states remain relatively affordable, even the cheapest are seeing costs increase year over year.
Owning a car in the United States is nearly universal—91.7 percent of households had at least one vehicle in 2022, the latest year with available data. That same year, 278.9 million personal and commercial vehicles were registered nationwide. But while the cost of buying a car draws most of the attention, drivers face another significant set of expenses.
According to analysis by Bankrate, the “hidden” costs of ownership—insurance, gas, maintenance and repairs, and state vehicle taxes—now average $6,894 annually, or about $575 per month, charges that come on top of any loan or lease payments. From 2024 to 2025, these hidden costs rose 3.1 percent, outpacing the current rate of inflation.
Breaking Down the Hidden Costs
To ensure consistency across states, Bankrate’s study compared costs for a 40-year-old driver with good credit, a clean driving record, and a 2023 Toyota Camry covered by full auto insurance. That profile revealed just how much location shapes expenses: insurance rates, fuel use, state taxes, and repair costs all differ sharply depending on where drivers live and how much they drive.
The Most Expensive States To Own a Car
Florida drivers face the steepest hidden costs at $8,483 per year, a 3.5 percent increase from 2024. Insurance is the biggest driver of these expenses, averaging $3,874 annually—the third-highest in the country. By comparison, gas ($1,612), maintenance and repairs ($1,474), and vehicle taxes ($1,524) are closer to the national middle.
Nevada ranks second, with hidden costs totaling $8,342 per year, or $695 monthly. The surge in insurance rates explains much of the increase. Average premiums jumped 18 percent between August 2024 and 2025, helping push overall hidden costs up 5.8 percent.
Louisiana continues to occupy the third spot, with drivers paying $8,254 annually in hidden costs, or $688 per month. While the state benefits from relatively low vehicle taxes ($1,130) and average maintenance ($1,460) and gas costs ($1,711), it is weighed down by the second-highest insurance rates in the nation, averaging $3,953.
The Cheapest States to Own a Car
New Hampshire once again tops the list of least expensive states, with average hidden costs of $4,472 per year, or just $373 per month. The Granite State benefits from no vehicle sales tax and some of the lowest insurance rates in the country, averaging $1,716 annually.
Washington and Alaska follow with costs of $4,744 and $5,131, respectively. Both states have lower vehicle tax burdens, though they too are experiencing upward pressure on insurance. Premiums rose 12 percent in both states from 2024 to 2025, contributing to year-over-year increases of 7.2 percent in Washington and 6.9 percent in Alaska.
Insurance
Nationwide, insurance is the largest cost, averaging $2,679 per year, or 39 percent of the total. Premiums are shaped by individual factors such as driving history and vehicle type, as well as broader influences including inflation, extreme weather, and tariffs. The five most expensive states for insurance are New York, Louisiana, Florida, Nevada and Michigan. At the other end of the spectrum, Idaho, Vermont, Maine, Hawaii and Indiana have the lowest average premiums.
Gas Prices and Mileage
Fuel costs average $1,650 per year nationwide. Drivers log an average of 13,662 miles annually, according to the Federal Highway Administration. But states where residents drive much more tend to face steeper gas bills. Wyoming averages 21,575 miles per year, leading to the nation’s highest gas costs. Indiana and North Dakota also land among the most expensive states for fuel. Washington, D.C., Rhode Island and New York have the lowest average gas expenditures.
Maintenance and Repairs
The cost of keeping vehicles in good working order has climbed as well. The national average for maintenance and repairs is $1,384 per year, up 3.6 percent from 2024. Weather, road quality, and local labor costs all play a role in how much drivers pay. Wyoming tops the list with average repair costs of $1,985 annually, followed by Mississippi ($1,748) and Missouri ($1,744).
