man in glasses drives red car


Buying a Honda Accord Sedan instead of a Honda Pilot SUV saves roughly $25,000 over 10 years. But both cars are still going to cost a whole lot when all operating and ownership expenses are included (close to $100,000 per decade).


Ever wondered how much money a smaller car actually saves? Maybe not, but you’re a little curious right? An SUV seems so much safer and more luxurious, right? And if an SUV really isn’t that much more expensive than a regular-sized car, why settle for less?

The numbers:

For this example, I’m comparing the estimated 10-year costs of owning (and then selling) a new Honda Accord Sedan versus a new Honda Pilot SUV. I’m assuming cash purchase of the car, although, I guess there could be a case made for financing and investing the difference, but we’ll keep it simple.  My cost data comes from the True Cost To Own section.

Edmonds’ True Cost To Own calculates the total cost of ownership over 5 years, including depreciation, fuel, maintenance, repair, insurance, taxes, and fees. Because I ran the numbers for Oregon, which has no sales tax, they are likely understated compared to the U.S. average. Either way, the numbers are still impressive. And also, since Edmond’s only calculates the cost to own over 5 years, I had to trend the individual costs out 5 additional years to fit the ROI model.

So let’s get to it.  The face value of a new Honda Accord Sedan LX is about $20,150, while the Honda Pilot LX costs closer to $27,900. So right off the bat, it appears that the Pilot costs almost $8,000 more. When accounting for all the other costs of ownership mentioned above, plus the opportunity cost of spending that extra money on a bigger car instead of investing it, the ROI of buying an Accord instead looks like this:

  • 10-Year NPV: $24,876
  • 10-Year ROI: 32%
  • 10-Year Payback: 0.7 years

Man, it will cost almost $25,000 more every 10 years to drive around in an SUV instead of a sedan! That is more than 3 times the face value difference between these two cars. And maybe what is even more jaw-dropping are the total costs of owning a car at all.

Even the Honda Accord costs $78,000 over 10 years, while the Pilot is closer to $96,500. This is why Mr. Money Mustache has such a bone to pick with cars: they are a huge financial drain. If a family managed to forgo 2 SUV’s for ten years, they could theoretically have a sustainable passive income stream of around $8,000 per year (4% of ~$200,000).

But if you’re anything like me, you’re not completely ready to get rid of cars. Not to worry, there are still savings to be had by just using cars less. And there is also the opportunity to be more financially sensible about your next auto purchase.

Edmonds and many other online automotive resources such as Kelly’s Blue Book and Consumer Reports have annual lists of the best-in-class cars to own based on lowest cost of ownership. Check these out next time before purchasing a new vehicle. And maybe don’t even purchase a new vehicle at all (purchase used – this is the subject of another post).


As usual, it turns out that less is more… a whole lot more in this particular case. Avoid bigger cars if possible and save some substantial dinero in the process, around $25,000 per decade to be exact.

Brand Category: 

About The Author

James Flannel Guy ROI's picture

Portland, Oregon-based Flannel Guy ROI is a working dude and family man that likes flannel shirts and wants to achieve financial independence a little sooner than most, particularly by making smart spending decisions and living intentionally. 

His overall idea is to look at spending decisions as investments: what decisions will return the most value to you over time? 

Each scenario is evaluated over a 10-year horizon with the following summary statistics:

Present value – what is the total value of your investment and expected returns in today’s dollars?
Return on investment (ROI) – how much of your original investment will you make back?
Payback period – how long will it take you to recoup your original investment?

Learn more at

Add new comment

To prevent automated spam submissions leave this field empty.
This question is for testing whether or not you are a human visitor and to prevent automated spam submissions.
7 + 13 =
Solve this simple math problem and enter the result. E.g. for 1+3, enter 4.
By submitting this form, you accept the Mollom privacy policy.