Car insurance premiums have been notably increasing. This trend is supported by data: Lexis-Nexis Risk Solutions’ annual report found average insurance costs rose 10% in 2024, following a 15% surge in 2023. Bankrate reports that full-coverage policies now average $2,680 annually, representing a 12% increase from June 2024.
Adding to the financial burden of car ownership is rapid depreciation. The AAA calculated the average new vehicle loses an eye-watering $4,680 in value every year over its first five years. Furthermore, Edmunds reported that in the last quarter of 2024, one in four consumers were underwater on a car loan, meaning they owed more than the vehicle’s market value.
Considering these factors, vehicles are becoming more expensive to insure while simultaneously depreciating rapidly. Perhaps tI should buy two…