Is a Car Worth It in College: Costs vs Campus Transit

What a car actually costs a year

AAA's 2025 driving cost study puts the average total cost of owning and running a new vehicle at $11,577 a year, or $964.78 a month. That figure covers a mid-size sedan bought new and driven a typical annual distance, and it dropped $719 from 2024 as vehicle prices and finance costs eased.

The total splits into several fixed and variable costs. Depreciation, the value a car loses each year, averaged $4,334. Insurance averaged $1,694. Finance charges on an auto loan averaged $1,131. Fuel added about 13 cents a mile on top of those fixed costs, so a student who drives 5,000 miles a year in a rented apartment near campus still pays roughly $650 in gas alone.

Add loan payments if you finance the purchase, and the true monthly outlay for a student on a budget can run well past $1,000 in the first year once a down payment and higher first-time-driver insurance rates factor in.

What campus transit costs instead

Many universities bundle an unlimited local transit pass into student fees, often called a U-Pass. Loyola University Chicago's U-Pass program costs $160 a semester for unlimited rides on Chicago's CTA trains and buses, about $320 for a full academic year.

Virginia Tech students living in the Washington DC area get unlimited access to Metrorail and Metrobus through a program described on the university's transportation site , priced at about $1 a day. Rates vary by city and by how each school negotiates with the local transit authority, so check your own campus transportation office for the exact figure where you study.

Parking, insurance, and other costs cars add on campus

A car on campus adds costs beyond ownership. Most schools charge a separate annual or semester fee for a parking permit, and rates differ widely by campus and by lot location, so pull your own school's parking services rate page before you budget. Insurance for a young or first-time driver also tends to cost more than the national average used in AAA's study, which raises the real annual total further.

Weather, maintenance, and repair costs add more variability. A car parked outside through a full winter or a summer of daily short trips to class wears down faster than one driven mostly on highways, pushing maintenance costs above the study's average.

When a car is worth it anyway

A car makes sense when your school sits outside a walkable or transit-served area, when you work an off-campus job with hours that don't match bus schedules, or when you need to travel home regularly and flights or trains cost more than gas and tolls. Rural and suburban campuses with limited local transit push more students toward car ownership out of necessity rather than choice.

Ride-share and carpool apps cover occasional trips, like a grocery run or an airport pickup, without the fixed costs of ownership. Many students combine a transit pass for daily commuting with occasional ride-share for trips a bus route doesn't cover.

Making the decision

Compare your own campus's transit pass price and parking permit fee against a realistic car budget that includes insurance, gas, and maintenance, not just a monthly payment. For most students living on or near campus, transit and occasional ride-share cost thousands less a year than owning a car, but a job, commute distance, or family situation can flip that math.