The cost of transportation is a key factor in any budget. If you leave it out, you will find money disappearing that you didn’t count on. Many people account for gas, and perhaps insurance, but transportation comes with a variety of expenses. Vehicles require licensing, maintenance, and occasional replacement. Perhaps you pay for parking at work. Likewise, public transportation brings various costs. Even a bicycle requires maintenance and safety equipment. When you lay out your expenses, you may just find places to improve your bottom line.
What Does It Cost to Own a Car?
Purchase of a New or Used Car
The cost of owning a car generally outweighs all other forms of transportation. Acquiring a car costs a fair sum upfront. Either you buy a car outright, or start with a down payment. While that initial payment is not a recurring one, it should still have a place in your yearly car expenses. When you factor in how long you typically own a car, that resulting number might appear more imposing. Unless you paid the car off all at once, you will continue with a monthly payment.
Costs of Owning a Vehicle
Fuel, insurance, and maintenance continue throughout your ownership of a car. Investopedia put the average consumer cost of gasoline at around $2,000. For insurance, comparing your intended purchase to your insurance carrier’s guidelines might help you pick a vehicle that is more economical. How much you pay for repairs and maintenance will vary on the age of your car and the quality of its build. Research into different makes and models pays off. One of the best ways to save money is to purchase the most reliable automobile within your budget. Don’t buy it because it’s shiny. Buy it because it runs well and has a good reputation. Never underestimate the savings a reliable vehicle provides.
Save with Public Transportation
If you haven’t looked at public transportation in a while, it might deserve another chance. Public transportation has benefited in recent times and, with the use of apps, it’s a whole lot more convenient. The days of wondering where your bus has gone are over. You can find most forms of public transit on your mobile devices as a moving dot on a digital map.
New, low-cost players have entered the scene as well, such as Uber and Lyft taxis. The cost is surprisingly low. Further, apps, such as UberPool, add ride-sharing to the experience for an even lower-cost ride.
The Costs of Alternate Transportation Vehicles
A Car-Free Lifestyle
In some situations, giving up a car makes obvious sense. Many residents of New York City don’t own vehicles. The New York real estate website, Brick Underground, explains why the troubles of driving and parking a car in the city is more than some people want. However, people living in any city, from New York to Cincinnati, can live a car-free lifestyle. If you don’t want to go on foot, downsizing your vehicle is an option you might consider.
Purchasing a Bicycle or Moped
When you switch to smaller vehicles, some of the costs will still apply. Competitive Cyclist lists bicycles for sale that exceed $10,000. Of course, you can also find them on Craigslist starting at around $50. A search of various sales sites will reveal motorized scooters start at around $500 and rising to around $9,000. Electric vehicles tend to carry a higher price tag but save on fuel cost. Do the math based on your own commute to figure out the difference.
When you buy an alternative form of transportation, use the same guidelines and practices as when you buy a car. Read the reviews and find out if the model you like is dependable. What is its fuel consumption? How many miles can you expect that model to last? Are former owners happy with it? Moped MPG gives a good idea of what to expect from the scooter market regarding miles per gallon. Repairs on smaller, less complex vehicles tends to cost less, especially if you wind up riding something as simple as a bicycle.
Combining Your Alternatives
When considering transportation alternatives, questions and doubts will arise. What about rainy days? Will I miss my car? What about emergencies? One economical alternative is to reduce your vehicle footprint. You might not need all the cars you currently own. That means you can employ any one of the alternative methods of transportation while still retaining a dependable vehicle as back up. Imagine the savings if you rode a bicycle to work just three times a week. Compare the your weekly cost of gasoline to the price of monthly pass and see which is less. As we suggested in an earlier post, you might look for ways to reduce your commute.
The Bare Bones of Vehicle Costs
When considering vehicle costs, be sure to add all of the related items:
- Down payment on purchase
- Monthly payments
- Repairs and Maintenance
Overall costs might surprise you. The comparison might also reveal what steps you need to take to save on transportation in the future.
Saving Money on Transportation
One way to determine if a lifestyle change will help you save money on transportation is to create a spreadsheet for vehicle expenses. With a little ingenuity, your spreadsheet will help to calculate your monthly and yearly costs on transportation. If you are keen on the use of alternative transportation, you can use the data to decide what changes you will make. Knowing how much you currently spend will help you to make your choices.