|
December 2005 |
|||||||
|
The Case for Canceling Your Commute 
For those who are serious about their finances, there is one bold money-saving move you can make that few people consider: Make your home close to where you work. A long commute costs a lot of time and money. Probably more than you think. And surprisingly few people factor in the commute when choosing a home. And with gas prices becoming more volatile in recent years, the costs can get a lot worse in a short time. But for the purpose of this article, we'll examine the costs in a present-day scenario.Gas, Maintenance and Depreciation Suppose your commute is 25 miles one way. That's 250 miles a week, and 12,500 each year. At the average national fuel economy of 17.8 mpg and at a hypothetical gas price of $2.35 per gallon, that's roughly $33 in gasoline each week, or $1,650 a year. As for expected maintenance, driving 12,500 miles to work will mean four extra oil changes and one fourth of your tire wear if your tires usually last 50,000 miles. Conservatively, that amounts to $300 per year for oil changes and gas. Less easy to predict is the "surprise" maintenance. But let's say you have a $20,000 car that you expect to last 200,000 miles over 10 years. In such a scenario, you could easily spend $5,000 on maintenance beyond oil changes and tires. And at 12,500 a year, your work commute would account for 63% of the miles driven and thus $3,150 in maintenance over the life of the car, or $315 per year in "surprise" maintenance. Then there's depreciation. If you have a $20,000 car that you expect to last 200,000 miles, every 12,500 miles of that equates to $1,250. So the grand total in gas and maintenance attributable to a 25-mile commute is $3,515 each year. Then There's Your Time That same 25-mile commute also eats up probably five hours a week when there are no traffic jams. Some weeks you probably spend a full workday getting to and from work! What is the opportunity cost of those hours? Is it time that you could spend with your kids rather than paying for childcare? Is it time where you could be cooking a meal rather than eating out again at a costly restaurant? Is it time where you could be cleaning your home instead of having a cleaning service come in to do it? Is it time where you could be earning extra money working overtime for your company or working on a different money-making project? Is it time you could otherwise be advancing your career? For argument's sake, let's say your time is at least worth the minimum wage of $5.15. That's another $1,250 a year. Quality of Life Exercise saves you money. And in a car, you sit very, very still for long periods. And an hour of commuting each day quashes many people's good intentions to stay fit. Also, it can raise blood pressure, stress and reduce your ability to get quality sleep. Staying healthy later in life can mean untold dollars saved, not to mention quality of life. If your commute is threatening your fitness, it's costing a lot more than the $4,765 calculated above. So what should we do? If all this makes sense to you and you are one of the lucky ones who can logistically do it, the next time you are shopping for a home, look for a place right near yours or your spouse's workplace. If it's close enough where you can walk, bike or take transit, you might be able to get rid of the second car, which would be the best scenario. Either way, you'll have more time, money and energy — all of which are getting scarce nowadays. |
|
|
|
|
|||
