Costs You Don’t Think About When Becoming an Owner-Operator

For many truckers, becoming an owner-operator is a career pursuit. With the U.S. Bureau of Labor Statistics projecting an annual job growth rate within the trucking industry of 5% from now until 2033 and the Department of Transportation projecting freight volume to increase by 44% by 2045, the sky is the limit for those in the trucking industry. Becoming an owner-operator also comes with plenty of benefits, including independence, job flexibility, and more money.

But, while the paycheck may seem mesmerizing, know that owner-operators still have to spend a decent amount of money, too. If you’re considering becoming an owner-operator in the near future, here are some standard and hidden costs you should be aware of:

Standard Costs

Your most standard, month-to-month costs as an owner-operator will include leasing rates for your truck (if you opt to lease instead of purchase), general maintenance and repairs, fuel, licenses and taxes, and insurance.

Leasing Rates

Rates vary depending on what type of commercial truck you’re leasing, how much money you put down upfront, whether your commercial truck is new, if it is used, and how old it is.

General Maintenance & Repairs

Your monthly costs for general maintenance and repairs will, of course, vary depending on the type of truck you drive, how far and where you drive, and the type of cargo you haul. However, a good rule of thumb is to play for monthly maintenance expenses between $900 and $1,400 a month. This amount should cover the cost of labor, repairs, new tires, and other general maintenance. You can lower your maintenance costs by:

• Performing pre-trip inspections and having regular maintenance checkups.
• Ensuring you always respect guidelines on axle weight and total truck weight to avoid any penalties or fees for non-compliance.
• Periodically checking your lighting systems, wipers, taillights, and other systems will help you keep repairs under control.

Fuel Costs

Your biggest (and most varied) monthly expense will be your fuel costs, with most long-haul truckers spending anywhere from $4,500 to $6,000 a month.

Taxes & Licenses

All long-haul interstate truckers are mandated by law to secure a United States Department of Transportation (USDOT) number. This number is an essential requirement of the Federal Motor Carrier Safety Administration (FMCSA). Your USDOT number is used to track your inspections, accidents and collisions, and your overall safety record. Your USDOT number will cost you $300.

Additionally, registering as a limited liability company (LLC) within Michigan costs $50, which is payable to the Michigan Department of Licensing and Regulatory Affairs (LARA).

Costs of Insurance

A more complex cost for an owner-operator is the cost of insurance. For commercial truck drivers, having multiple insurance coverages is essential. As an owner-operator, your yearly insurance costs will typically average between $9,000 and $12,000 annually.

Hidden Costs

While the previously mentioned costs are a good guideline/starting point, hidden costs will always arise periodically.

Fuel

Yes, fuel is a standard, expected cost, but it’s also the best example of a cost that could suddenly become volatile and unexpected.

While fuel costs are incredibly hard to nail down, there are some proactive steps you can take to reduce your fuel consumption.

• Invest in good tires and consider tire retreading to save additional money.
• Fuel cards like a TCS Fuel Card or WEX Fleet Card help with discounts and come with apps that help you manage your fuel costs.
• Ensuring proper pressure ratings (PSI) on your tires and having them periodically balanced and aligned all help to improve fuel consumption.
• Finding a good cruising speed at or very near the speed limit will help reduce fuel consumption.
• Using trailer side skirts can help reduce drag, making your rig a little more aerodynamic and helping you save on fuel.

Food

One proven way to reduce your food expenses is through meal planning. While food is a necessary expense, you can decide how much you spend on it. Buy healthy food in bulk and plan your meals ahead of time. Pre-planned and pre-packaged meals are healthier and will save you money as you won’t be buying more expensive fast food.

Taxes

The self-employment tax rate for owner-operators is 15.3%. This rate consists of Medicare taxes at 2.9% and Social Security taxes at 12.4%. However, as an owner-operator, you can take advantage of percentage-based depreciation, where you secure tax deductions (or lower your taxes) by deducting the cost of your truck as it depreciates.

Changing Premiums

There are several types of insurance you’ll need to have as a truck driver, including general and primary liability, cargo, Bobtail insurance, physical damage insurance, and motorist coverage.

Primary Liability Insurance

Within Michigan, you can expect to pay anywhere from $9,000 to $12,000 a year on primary liability insurance. This is a federally mandated insurance that all owner-operators must have and it protects you against property damage or bodily injury.

General Liability Insurance

With general liability insurance, you’re covered if you’ve experienced an accident and someone tries to hold you financially liable for property damage or personal injuries. It’s another low-cost insurance that is worth paying for at around $30 a month. While primary is specifically related to auto incidents, general liability is more broad and protects you while you’re on the clock but off the road.

Cargo Insurance

This coverage option protects your cargo in the event of theft, loss, or damage during transport. Depending on the type of cargo you transport, you can expect to spend anywhere from $500 to $1,200 a year.

Bobtail Insurance

You can almost guarantee times when you won’t have a trailer, such as when you’ve dropped off a trailer and have no return fare or trailer to haul. This is called bobtailing, and it’s known to be incredibly dangerous, according to the FMCSA. Bobtail coverage isn’t included in general liability insurance because bobtailing isn’t a normal mode of operation for trucks. Having this extra coverage is a worthwhile investment, and at just around $50 a month, it won’t break the bank.

Physical Damage Insurance

This insurance protects you as an owner-operator should your truck need extensive repairs after a collision or accident. It can cost as much as $3,000 per year, depending on where you’re operating/hauling goods.

Uninsured Motorist Protection Insurance

This is perhaps the most overlooked form of insurance. It offers financial protection in incidents where an uninsured driver is at fault. With an average cost of approximately $75 a year, this insurance coverage is well worth the investment.

Unexpected Breakdowns

No matter how proactive you are with maintaining your commercial truck and trailer, at some point, you’ll encounter breakdowns. While leasing a used commercial truck with a good service record and history report ultimately helps to reduce the likelihood of a breakdown, they can and will happen. This is why it’s essential to set aside anywhere from $2,500 to $5,000 or more as an emergency repair fund.

Downtime

As the saying goes, it’s often “feast or famine,” and this is especially true for owner-operators. There will be times when you’re not hauling freight, but you’ll still need to account for your expenses. Rather than dip into your emergency repair fund, it’s best to have some money set aside for your more consistent monthly expenses.

Non-Compliance Fines

There are more than 20 potential DOT record-keeping fines and plenty of FMCSA penalties for non-compliance that can easily trip you up and blow your budget. Staying up to date with regulatory changes is one way to avoid the most common fines.

In 2025, recording-keeping fines could set you back a maximum of $15,846 from the FMCSA, with a per-day penalty of $1,584. Other potential fines include operating your commercial truck when you have an out-of-service order. Daily fines are $1,182, with a maximum of $23,647.

License Renewal Fees

The cost of renewing a CDL in Michigan is $25, and it must be renewed every four years.

DOT Inspections

DOT inspections are mandated to ensure your commercial truck is safe for use. The FMCSA requires all commercial vehicles over 10,000 pounds to have a DOT inspection every 12 months. These inspections cover the truck and the trailer. Yearly costs for a Michigan owner-operator include $125 for the truck and $75 for the trailer.

Accounting Fees

Excellent record-keeping isn’t just mandated by the FMCSA and DOT—it’s also an essential part of maintaining a healthy and successful business. As an owner-operator, you should expect to pay an accountant an hourly rate of $150 to $400.

Navigate Owner-Operator Costs With TSI

Starting any new career can be overwhelming—if you’re considering a career in trucking, let TSI help guide you. We offer a six-week hands-on program for new drivers, and if you join our team, we’ll offer plenty of growth opportunities to get you into an owner-operator position. Please contact us today with any questions about truck driving, visit our website to explore opportunities, or check out our blog for more resources and insight.