Buying and running a car
What the car actually costs, not what the sticker says.
Ends with: A total yearly cost you can compare against another vehicle, or against not owning one.
Nothing here tells you which car to buy or which lender to use. Vehicle finance in New Zealand is regulated credit, and the disclosure you are entitled to before signing is covered in the finance step.
A car has two prices. There is the one on the windscreen, and there is the one you actually pay across the years you own it, which is usually several times larger and almost never calculated before the purchase.
This pathway builds the second number. It starts with total cost rather than purchase price, because the cheap car with poor fuel economy and expensive parts is a familiar and expensive mistake. Then finance, which is where a manageable purchase becomes an unmanageable one, and where balloon payments in particular hide the real cost at the end.
The middle of the pathway is running costs: fuel, road user charges, insurance, and the difference between petrol and electric once you count everything rather than just the fuel bill. These are the numbers that decide whether a car is affordable, and they are the ones people estimate rather than calculate.
The last steps cover claiming vehicle expenses if you work for yourself, and the two purchases that behave differently from an ordinary car: motorhomes, which depreciate on their own schedule, and imports, where the price you see is not the price you pay.
One step has no calculator. Importing a vehicle involves compliance, entry certification and duties that vary too much by vehicle and year for a tool to give an honest answer, and a calculator that pretends otherwise would be worse than none.
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What a first car really costs
Purchase price is usually less than half of the first year. Registration, insurance, tyres, a warrant and the first repair arrive quickly, and budgeting only for the sticker is how people end up with a car they cannot run.
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What you can actually afford
Affordability is a function of your income and your other commitments, not of what a dealer will approve you for. Those two numbers are rarely the same and the gap is the problem.
Work out your own: Car Affordability Calculator 10 min read -
Finance, and what it adds
The interest rate is not the whole cost. Establishment fees, payment protection insurance and the term all move the total, and the weekly figure a dealer quotes is designed to look small.
Work out your own: Car Loan Repayment Calculator 18 min read -
Balloon payments and where they leave you
A balloon lowers the weekly payment by leaving a large amount owing at the end. If the car is worth less than the balloon when it falls due, you are paying to get out of your own loan.
Work out your own: Balloon Payment Calculator 14 min read -
Agreed value or market value
Comprehensive cover comes in two shapes and the difference only appears at a total loss. Agreed value pays a number you set; market value pays what the insurer says the car was worth that day.
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Fuel, the cost you notice
Fuel is the running cost people track, and the one most sensitive to the vehicle you chose. Small differences in consumption compound across a year of the same commute.
Work out your own: Fuel Cost Calculator 13 min read -
What the drive to work costs a year
Running costs are usually quoted per kilometre, which hides how much the daily commute is. Put your own distance and days in and it becomes a yearly number you can weigh against rent somewhere closer.
Work out your own: Commute Cost Calculator 6 min read -
Electric against petrol, fully costed
Electricity is cheaper per kilometre and electric vehicles now pay road user charges. Both facts have to be in the comparison or the answer is wrong in a predictable direction.
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Road user charges
Diesel and electric vehicles pay by distance rather than at the pump. Running out of RUC is an offence, and buying it in the wrong increments costs more than it needs to.
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Claiming the car against your income
If you are self employed you can claim vehicle costs two ways, and the cheaper one depends on how much you drive and what the vehicle cost. Choosing without comparing usually costs money.
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Motorhomes and caravans
These depreciate differently from a car, cost differently to insure, and are used for a few weeks a year. Cost per night of actual use is the number that settles whether owning beats hiring.
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Importing a vehicle
Ends here because it is the one purchase where the advertised price is furthest from the landed cost. Compliance, entry certification, duties and shipping vary too much by vehicle and year for a calculator to answer honestly, so this step is reading rather than arithmetic.
8 min read
When to stop and get someone else
If a dealer's finance offer is the only one you have seen, get a quote from your bank or a credit union before signing. Dealer arranged finance is a commercial product with commission in it, and comparing two offers costs nothing. For a dispute about a vehicle you have bought, the Motor Vehicle Disputes Tribunal is far cheaper than a lawyer.
This pathway is information, not financial advice. Rates, thresholds and rules change; every guide carries the date it was last reviewed.
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