Transportation can be quite costly if you make certain choices. For instance, some people think that owning a car is required if you need to get around town. This is not always the case. For me I have to have a car because the nearest bus stop to my place of employment is 10 miles away, but most people I know don’t have those sorts of circumstances. We are going to explore how to save money by going without a car, or amending how you use your car if you choose to keep one anyway.
Let’s break down the cost of owning a car:
· The car payment/purchase price. If you already own your car outright this is not a concern, but for those of you who would need to buy a car they are very expensive. It is possible to buy a used car for $5,000.00- $10,000.00, but be very careful to get the car checked out by at least two mechanics. You don’t want to buy a lemon. If you want a newer vehicle it is not uncommon for the least expensive late-model cars to be at least $10,000.00! Monthly payments can range from $200.00 a month to $400.00 depending on your credit score! I
· Gas. Today where I live gas is $3.33 a gallon. The average person drives about 1,000 miles a month. If you purchase a car with a somewhat decent gas mileage of 25mpg your monthly gas cost is $133.20.
· Insurance. Comprehensive-insurance for a person under age 25 can easily be from $100.00-$150.00 a month (even after shopping around). If you can’t afford to buy another car, or pay for an accident out-of-pocket should you have one, then you should have comprehensive insurance (unless your premiums add up to more than 50% of the value of your car each year…put your money in a savings account to start saving for a new car).
· Maintenance. Tires for my Cobalt are around $400.00 every time I have to replace them (about every two years). Brakes can easily be about $300.00, a tune-up $400.00, and oil changes (if you don’t do it yourself) $30.00 every three-five months.
· Parking permits. Where I attend school an inexpensive parking permit is still $800.00 for the year!
Add up your prospective costs! Can you really afford a car? There are alternatives to owning your own car where you can still have all your transportation needs met and save a great deal of money. Or if you own a car you can use these techniques to reduce the cost of ownership.
The first is public transportation. Many colleges and universities offer reduced price bus cards. I can buy one that lasts the fall and spring semesters for just $150.00 (That is only $12.50 a month when you average it out!). For those of you who own a car choosing to ride the bus just a couple times a week can reduce your driven miles which will lower your gas and maintenance costs.
Another option is to make sure you live only a mile or two from campus. Ride your bike, skateboard, rollerblade/roller-skate, walk, etc. Not only will you be saving money you will also get some exercise in.
There will still be occasions when having a car to use will be beneficial. That is why car-sharing services like Zipcar are so great. For an annual membership fee plus the cost of daily or hourly use rates you have a vehicle that you can use for special circumstances...like moving (yes you can get trucks), or important events where taking a cab or public transportation would be too inconvenient or expensive, or grocery shopping. You don’t have to pay for things like gas, insurance, or maintenance. You could also use a traditional car rental service if you feel you might only need to use a car a few times a year. For vehicle owners renting a larger vehicle like a truck only when you need it (like moving a piece of furniture [the Home Depot rents pick-up trucks by the hour]) can lower the overall cost of vehicle ownership (vehicle price, insurance, maintenance, gas) because you can buy a less expensive sedan or compact car.
Another option is to carpool. Find people who work where you work or who have a similar class schedule and ride with them (just make sure to kick in some gas money).
Going without a car can save you thousands of dollars a year…thousands of dollars that can help pay for your education.
The next post will cover ways to save on your utility bills…
