Mrs. Cash Dummy and I hit a pretty big financial speed bump when we were shopping for our current primary residence: we bought a house that includes a 37.5-mile commute to where I work. We love our house, but the decision to take on that commute has been a pretty big drag on our finances. Here’s how my transportation costs break down over the span of an average month:
- Fuel: $160 ($40 per tank, per week; my full-size V6 family sedan has an 18-gallon tank)
- Tolls: $90* ($4.50 per round trip, 20 round trips per month)
- Auto loan: $0 (the old girl is paid off)
- Insurance: $100
- Maintenance: $17.48 ($50 oil change every 5000 miles, give or take)
Not to mention the added costs over time for things like depreciation and wear and tear…
Bottom line, just getting myself and my 4500-pound car to and from work every day is costing me $368.48 every month. Costs like these aren’t something I noticed until very recently. I always knew it cost money to maintain a car, but I never paid attention to anything beyond how much of my next paycheck was going to gas. The real cost was a significantly larger number than I expected once I sat down and did the math. I suspect the same is true for many of my fellow Cash Dummies out there.
What to do about that big scary number? There are several possible solutions:
- Ditch the added cost of Mrs. CD’s car and become a single-car family
- Move closer to work
- Ride a bike
We’re actually discussing the single-car option, but we’re not quite ready to pull the trigger. Moving closer to work isn’t an option, we can’t afford the expense or the loss we’d take on the sale of our current home because we used a zero-down loan (as such, we have almost no equity built up yet). A bike isn’t feasible because we bought in a town that’s not very bike-friendly and is WAY too far from my work.
That leaves one option: ride sharing. It could be as simple as an informal carpool with a few coworkers or as involved as a large-scale ride sharing program through a corporation, either way, we’ll hopefully come out on top. In my case, I happen to have access to a formal vanpool program through my employer, but we’ll look at the numbers for a carpool as well.
Vanpool membership: $255 per month
Insurance: $0 (covered by vanpool provider)
Fuel: $0 (covered by vanpool provider)
Tolls: $0 (covered by vanpool provider)
Employer ride share subsidy: $255
Net cost: $0!
Carpool cost (using my current vehicle):
Monthly operating costs (from above):$368.48
Cost share: $276.36 (assuming three other riders)
Net cost: $92.12
Of course, the 100% vanpool subsidy is a sweet deal because it completely eliminates the cost of my commute. However, as long as I own my vehicle I still have to pay to keep it running and insured. The carpool option still produces significant savings (which increase with each rider) with the added benefit of offsetting a large chunk of your total operating costs for the vehicle.
I also have to mention the environmental benefits of not using a two-ton dinosaur-juice-burning metal contraption to transport a single 185-pound human. According to recent EPA figures, an average gas-powered car releases about a ton of CO2 into the atmosphere in one year. By sharing my commute with three coworkers we will have prevented at least SIX THOUSAND POUNDS(!) of CO2 from being blasted into the sky by this time next year. I don’t know about you, but I’d prefer not to be sucking that into my lungs or getting baked under those greenhouse gases.
Bottom line: fewer pollutants in the environment and more dollars in your wallet. Ride-sharing has saved my family over $750 in the first three months alone, all while reducing my carbon footprint. This one gets a big fat Five Star Rating from me!
Have any of you ever tried ride sharing? What are some other ideas you’ve used to reduce or eliminate the costs of a long commute?