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Deal with Your Debt: The Right Way to Manage Your Bill$ and Pay Off What You Owe by Liz Pulliam Weston

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How Cars Cost Us

Transportation is a big part of the average American family's budget. The costs of purchasing, fueling, insuring, maintaining, and repairing vehicles are the second-largest expenditure on average, right behind housing (see Table 7.1).

Table 7.1. Average Household Expenditures
CategoryAmount SpentPercent of Total SpendingPercent of Pretax Income
Housing$13,43233%26%
Transportation$7,78119%15%
Food$5,34013%10%
Other$4,09410%8%
Insurance and pensions$4,05510%8%
Health care$2,4166%5%
Entertainment$2,0605%4%
Apparel and services$1,6404%3%
Totals$40,818100%79%
Source: Bureau of Labor Statistics, 2003

The biggest chunk of our transportation costs (more than 70% of the total, on average) is the money we shell out to actually buy or lease the car. ...

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