Personal finance author and media personality Suze Orman highlighted in her May 15 newsletter that the monthly expense of owning a car is approaching $1,000 for many families.
She noted that the typical payment for a new car loan is close to $750 per month, while the average cost of insurance has risen to around $200 per month, compared to $130 per month back in 2020.
To battle these high costs, Orman proposed a solution that many households might find to be a radical idea.
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Orman cautioned that insurance premiums are likely to climb even higher. Insurify recently reported that if proposed tariff changes go into effect, car insurance rates could surge by an average of 19%.
Many vehicles sold in the U.S. contain numerous foreign-made parts, and increased tariffs on aluminum and steel would further drive up costs. Because insurance premiums account for the expense of repairing or replacing those now pricier components, they would also be impacted.
Before tariffs became a concern, Insurify had already projected a 5% increase in premiums for 2026.
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Orman also pointed to troubling signs in the broader cost of owning a car. In 2024, vehicle repossessions due to missed loan payments and the number of auto loans falling into default reached levels not seen since the Great Recession of 2009, according to Cox Automotive.
“If your house is feeling the stress of car ownership, I think it’s time for a major rethink,” Orman wrote. “Especially if your household has more than one car.”
A woman is seen sitting behind the wheel of a convertible car. Suze Orman floats the idea of saving costs by cutting down to one car per household.
Suze Orman proposes saving on car costs by cutting down to one car per household
Orman encourages individuals to take a serious look at their household transportation needs, particularly when managing two cars for commuting and family logistics.
She urges people to honestly assess whether they could make do with one vehicle, emphasizing that keeping two simply out of habit is not a strong enough justification.
While she acknowledges that such a change might be a significant lifestyle adjustment, she stresses the importance of financial stability.
If a household is experiencing financial strain, she believes it is worth having a thoughtful discussion about potential alternatives and the savings that could come from downsizing to a single car.
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Orman encourages couples to first consider whether they truly require two cars every day of the week. She suggests exploring the possibility of sharing a vehicle, especially if one or both individuals work from home.
Coordinating car usage based on daily needs could be a practical solution. If public transportation is a viable alternative, she believes it’s worth discussing how it might fit into their routine and help reduce expenses.
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Suze Orman emphasizes the importance of reducing a household’s number of cars
Orman suggests that cutting down on commuting could be a smart way to approach a conversation with an employer about working from home a day or two each week.
She points out that if a company genuinely cares about the financial well-being of its employees, it should be open to considering flexible work arrangements that could result in meaningful savings, such as eliminating the need for a second car.
She also encourages people to broaden their search for potential carpooling partners. It doesn’t have to be someone from their immediate work circle — perhaps a neighbor or colleague from another department could be an option. Alternating driving days or weeks could make it feasible to manage with one family vehicle instead of two.
For families, she urges careful consideration of how the second car is primarily used. If it’s mostly for shuttling kids, increasing carpooling efforts might be a practical solution.
If it’s needed for weekend errands and activities, she suggests looking into ways to streamline schedules and find a system that allows everything to get done with just one car.
“f you are feeling financial stress, how would you not jump at the chance to remove $1,000 or more in monthly spending?” Orman asked. “Even if you end up renting a car a few times a month, or you use ride shares more, I bet you can still save more than $500 a month by getting down to one (or no) car. And that’s not even factoring in the cost of maintenance.”
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