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Should You Ditch Your Car to Save Money?

It’s been two-and-a-half years since I started this blog about being really, really broke. In that time, one suggestion has been given to me over, and over, and over again:

Get rid of your car! Save on gas money, insurance, and maintenance! Walk/bike/use public transportation instead!

Partly this is due to some confusion about where, exactly, I live. Some people see the “New York” part of my location, and they think skyscrapers and subways and taxi cabs. Which couldn’t be further from the truth: I’m from Rochester, New York, 256 miles away from New York City. And I’m not even really from Rochester; I grew up in a tiny town 20 miles outside of Rochester. So what they really should have been thinking was “log cabin across the street from a corn field.”

Crystler Building [sic] by LabyrinthX on Flickr  vs

So ditching my car back while I was living in the middle of nowhere was never really an option. There were literally zero jobs within walking distance, unless I owned a tractor (which would have been more expensive than the car). But now I live in a suburb, and I’m moving to the D.C. area. It’s hard to say, not knowing at all what my life will be like down there, whether or not I’ll really need my car.

So maybe I will end up ditching my car. But I stand by my thought that offering “ditch your car!” to people in financial trouble is pretty poor advice. Not terrible, but pretty poor. If you could live without your car, you probably already know that you could. I already knew that taking the bus in Rochester was not a viable option for me, but still the advice persisted.

Which is not to say the advice is without some merit. Yesterday, Matt Jabs wrote about his experience as a part of a one-car couple. And Alan Schram calculated that it would cost him $8,535 per year to switch from pedestrian to driver. And like I said, if I find my lifestyle in D.C. to be amenable to carlessness, than I might ditch the Oldsmobile. (But shhh, don’t let my car hear me say that. She might decide to take revenge on me while I’ve still got her!)

What do you think? Is “ditch your car!” good advice to give to someone who’s in financial trouble?

38 responses to “Should You Ditch Your Car to Save Money?”

  1. SP

    Generally, yes. But some people insist they couldn’t live w/out a car when they really could. In your situation, it is pretty clear you were better off having it, but even just skimming the “one car couple” link, they initially thought it would be impossible.Sp

  2. Paul

    A lot of people who don’t need a car think they do. Especially in urban/suburban settings, 10 miles in a car is 20-30 minutes. 10 miles on a bike is 30-50 minutes. Not a big difference. Carrying stuff is still an issue, but in my experience, the biggest issue people think they would have is lack of time.

  3. Kelly

    As with any financial advice there is no one size fits all. I would love to have one less car (we have 2 cars), but my husband has no other means to get to work. His time is more valuable than the savings he’d get from doing the hour+ bus ride for a job that’s 7 miles away. (he’d have to transfer several times)

    We have done it out of necessity before though, and it wasn’t hard with one child, but with 4 kids and different activities, errands, etc. it’s much easier for us to have 2 cars.

    Eventually I hope the hubby can work from home more, and we could cut back to one car. Eventually we’d like to move somewhere where we could rely on cars less.

    I have a friend who has a carless lifestyle. It works for them even with 3 small kids.

    I think it depends on where you end up in DC. It is possible, but you’d have to be like my friend and look only in reasonable walking distance for work.

    1. Planned Obsolescence

      Hi, Kelly.

      If I lived 7 miles away from my job, I’d bike to work. It takes about 30-40 minutes door-to-door and has obvious health benefits. Maybe invest in some good rain gear and find a way to carpool with a co-worker during the worst of the winter months (which in DC isn’t terribly intense). Then see if there’s a way to coordinate kids’ activities and other errands with just one car. Definitely a lifestyle change, but it might be worth it to save a few hundred every month.

  4. Kamantha

    I acutally live in the NW DC area and I dont need a car. When I go grocery shopping, I either can rent a Zipcar for an hour or two or tagalong with a car owning friend who is already going to the grocery store. And depending on what neighborhood in DC you are living in, you can walk to the grocery store. And if you are really lazy you can use Peapod, where they deliver your groceries to you.

  5. Tim

    Ditching your car is not a viable option in most places. I’m in a major city- Ft Lauderdale. It has public transit, and some bike lanes. I could possibly switch to a bike here and get to and from work in a reasonable manner…except that it rains. Daily, during the summer. Bus is completely out of the question. The only train I’ve seen or heard … about runs north to south- great if I want to live in Miami or Palm Beach and work along the line, but otherwise, not useful. Without mass transit, shopping would be a huge pain.

    If you want to ditch your car, you need to live somewhere with relatively good mass transit. Unfortunately, that usually brings higher cost of living (major city like NYC) or lower potential earnings (small town with decent bus service and fairly light traffic).

    Just being in a “major metro area” isn’t good enough. There is an old city vs new city dynamic to consider. If you’re in NYC or Boston or Philly, you can commute in on a train or bus without too much hassle or aggravation. If you live in a “new city” like I am, you’re too spread out. There are high rises, but the average person here lives well outside the city they use to identify their location, because of the cost of getting a house/condo in the city itself. This means that, quite literally, the entire “metro area” is a giant sprawl, with no real good infrastructure set up to move through it easily and quickly aside from a car. Every little town has their own sidewalk/bike rules, and most of the “quick” ways to get around don’t have either.

    Having said I can’t give up my car, I should also mention I’m in a one-car relationship already. This works well enough, since we currently only need one car. We never viewed this as a permanent option, but one that we figured will last until she finds a job that will cover the costs of a second car.

    Another thing people mention in relation to public transport/biking is using it “some of the time”. That helps offset costs, true. But the biggest costs I pay are not related to my fuel economy, but to my car payments and insurance. Insurance might drop a bit if I tell them I’m not using it for commuting anymore, but that car payment is staying the same.

    Zipcar is a great concept, but far too limited. Ideal locations for them are University campuses and high rise condos, and everywhere else is lucky if they even know that the service exists.

    One other point: If you’re thinking about going without a car, weigh everything, including trips. I prefer to drive on my vacations, rather than fly, partly because of price. One alternative for that is just renting a car with unlimited mileage for that duration. There are limits to this, and if you’re under 25 (like me) you’ll get slammed with extra fees, but it’s probably cheaper to rent for the occasional trip outside of your local area than it is to pay all the associated costs of owning a car if you only want it for that twice yearly trip to visit family.

  6. Kamantha

    Yeah in NOVA (Northern Virginia) you would definitely need a car. Hopefully you will get a job around a Metro station and it offers Smart trip Benefits then Metro can be an option. Only thing about NOVA is that you will pay a separate car tax for having a car (depends on the county you live in). Don’t forget to put that into the equation.

    http://www.fairfaxcounty.gov/dta/cartax_home.htm and http://www.co.arlington.va.us/Departments/CommissionerOfRevenue/CommissionerOfRevenueVTOverview.aspx

    PS: Depending on location, they have wonderful bike trails also for commuting to work.

  7. Jerry

    Ditching a car to save money TOTALLY depends on where you live, you hit the nail right on the head. When we lived in Maine, it was a challenge to make due with ONE car (we had two), because public transportation was almost non-existent. However, we ended up selling both vehicles when we moved to SE Europe last year, and that has saved us a bundle. Gas and insurance costs are gone, but we also don’t need a car to get around this capital city. It’s not necessary. In fact, most of our friends here don’t have cars, and if they do they use them quite rarely. This would have been unthinkable in our previous location, but here it is quite do-able.
    Jerry

  8. Paul @ FiscalGeek

    We tried changing vehicles to save money including a Jetta TDI and a motorcycle but in the end the ROI is going to be about 5 years to really see the benefits. It’s just really not doable for our family of 4 to only have one vehicle where we live. Now if we lived in Tokyo that would be a different story.

  9. Roger

    Add me to the chorus saying that it depends on where you live and how you use your car. If you do live somewhere with a good public transit system and/or a high enough population density that most of your regular needs are within a few miles of your house or apartment, then by all means, cut down on your car use, even selling the car entirely if that’s what you want to do. If not, you should probably hold onto your car and simply try to cut down on your driving where possible. I wouldn’t make it the first step in trying to get my finances in order, but if things got bad enough, getting rid of the car would definitely be on the table (along with most other things).

    One note, since several people have talked about biking rather than driving: there are some people who can’t bike (including myself), whether for physical reasons or simply because they never learned. For me, at least, any argument against cars based on logic like ‘it’s almost as fast to just bike’ doesn’t do much help. Just a note for you and the other commentators when discussing this issue in the future.

  10. Funny about Money

    If I lived in a city with decent public transportation, absolutely!

    My ex- and I lived in London for a brief time and never thought of getting a car. Getting around for light errands and daily commutes was no problem. If you needed a car for a weekend trip or for some other special reason, it was easy to rent one — and a lot cheaper than owning, maintaining, and housing your own.

    Here in Phoenix, alas, it’s out of the question. To get to the new lightrail, you have to drive and use a park-&-ride lot. Bicycling, even if you enjoyed that activity in 118-degree heat, is ridiculously dangerous — just a couple days ago another brave soul who tried biking to work was killed. Cabs are out of most people’s price range. And nothing, but nothing is within walking distance!

  11. cavale

    living in NOVA you will most DEFINITELY need a car. at least until they finish extending the Metro to Tyson’s Corner.

  12. brooklynchick

    as a New Yorker (and former DC/Philly resident) this is easy. It saves me tons of money and time to not have a car.

  13. ramsaym

    Yes! Absolutely ditch your car! You are not only helping the environment you are also helping your retirement. If you get rid of your car when you retire you can retire with $180,000 less in retirement savings.

    If you get rid of your car before you retire and invest the savings, after 20 years at 9% average returns, you will have $400,000 in savings! Get rid of your car. I live car-free in San Francisco.

  14. hustler

    That’s funny.
    I live in rural kentucky and there really is no public transportation except for a private cab service. With one major highway and not even a shoulder, a bike is an option only if you don’t mind semi trucks blaring their horns at your back as you bike 35 mph. That being said, there is a lot of carpooling going on where I work. All the carpoolers have cars, but alternate who drives so that each driver is only driving 1-2 days a week. They still have to pay for insurance and upkeep, but gas and wear and tear is less. A car is a neccessity here unless you live in “town” within walking distance to work and grocery shopping. But if you need to go anywhere else, you’re going to spend the money you’ve saved on cabs or renting a car.

  15. Patrick

    I WISH I could turn in my cars and transfer to public transportation. I do not enjoy paying monthly payments on anything and no, I don’t have the money to buy outright.

    But just like everyone else has said it’s about where you live. I live in Florida, the closest store is about five miles away. Come to think about it the bus doesn’t even come past my area. It just would not be cost effective to take cabs/taxis in an area like mine.

  16. John

    Getting rid of your car, not always a viable option. However as a (poor) just out of college person, I’ve found viable alternatives. For instance, scooters can be had for around two thousand (a quality Honda), that can get up to 100 mpg. As well as insurance being dead cheap (mine averages to less than 10 dollars/month).

    Shopping isn’t the greatest experience, but it’s all about transporting what you can and cant. I buy everything I need for a week, load it up into a backpack and container on the end of the scooter, and off I go. I can only reach speeds up to around 50 mph, but for local commute, that’s all I need.

    Granted, this only works if you live in a warmer climate. I’m currently on vacation in MI with family, and I remember the three foot snow drifts. You’ll definitely need something with four wheels if you live in a snowy area, otherwise there’s nothing wrong with a scooter/bike. It comes down to geography, and what you’re willing to give up to save money. If you’re able and willing to look a little funny shopping with a scooter (as I am) more power to you. If not, then use your car.

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  18. John

    Well, I pretty much stopped using my car and since it was paid off already this did a good bit to save cash. I still had to keep it insured due to state laws, but I was able to get a huge discount (about $20 a month) when I told them I wouldn’t be commuting to work every day.

    I saved about $200 a month just by working from home and cutting out unnecessary travels, but I still drive 5-10 miles a week to get food and visit friends. It would be really tough to do without some sort of transport in this sprawled suburban locale.

  19. Anon @ truck parts

    Well, it really depends on your location. I think if you are in a rural area, you need a car so that you won’t have a hard time waiting for cabs or any vehicle that can accommodate you to where you want to go. But if you are in the city, where there is heavy traffic, sometimes having a car is not even an option. Lets say, riding on a train for example, can give you a faster travel without the hassle of heavy traffic.

  20. cavale

    this is a great resource to help with decision making in this area:

    http://www.walkscore.com

  21. Steve @ Voucher Codes

    I’m from the UK and always begrudge filling up, it’s something like £1.02 a litre! I’m definitely considering getting a bike to save money

  22. Jerry

    it’s tough to say if it’s a good or bad thing. i think if you already have a car, try not driving it as much and use public transportation. call your insurance company as well and tell them you take the bus to work, it will reduce your bill by quite a lot. if you still can’t afford it after that, then maybe it’s time to sell.

  23. Silas

    Stephanie,

    While not the worst advice I’ve heard, “just ditch the car” does bypass a lot of much-needed thought.

    Whether or not “car-free” works for you depends on many factors. The main one is where you choose to live. But equally important is the the effort/inconvenience you’re willing to tolerate to save money.

    I live in suburban Maryland, work in NW DC and am car-less. It seems to me that parts of NOVA are pretty friendly for the likes of me, but I’ve never lived there. Is there any reason you can’t live in DC? (You could most assuredly live car-less there).

    I suggest you decide where you’re going to work first, and then try to find a place to live within 3 miles or so of there. Sometimes easier said than done, but overall, living a short bike or walking distance from work is the surest step you can take toward successful car-free living. (Mind you, I don’t follow my own advice because I prefer the suburbs and cheaper rent, and pre-planned a pleasant (20-30 minute) bike commute each way with a short Metro trip.)

    And how much inconvenience are you willing to tolerate in exchange for money saved? Especially over distances greater than 5 miles, it appears public transportation is often slower than driving. Can you find productive use of time on buses and trains? Do you enjoy a slower pace of life? Does it sound appealing to get many errands done by bike (even using a trailer for heavy loads!), or by bus, in all kinds of weather? Can you handle the necessity of pre-planning how you’ll get from Point A to B in order to arrive on time? For me, the answer’s an enthusiastic “yes,” but I can’t assume the same for you.

    According to a 2004 study by AAA, the average American spends over $600 a month on their car when ALL expenses (including depreciation) are included. You should start by calculating how much YOU spend (or spent) to determine whether car-free pays off. Check out http://www.edmunds.com‘s True Cost to Own figures if you need help with your estimate.

    I hope this helps!

    Silas

  24. Sal

    Stephanie,

    This may be a good start…

    http://www.commuterpage.com/novasched.htm

    Best of luck! -Sal

  25. No Name? @ Autostry

    I do think that it still depends on the current situation of the person. It’s a good advice to those who have cars and don’t need to use them daily or could afford to take public transport as an alternative.

  26. Namity McNameson

    In London (United Kingdom), a lot of people have got rid of their car because it’s too expensive to maintain. High parking and congestion charges add a significant cost to the car and, as a result, a lot of Londoners have decided to ditch their car. A fair number of them have switched to motorcycles, which offer a quicker and greener mode of transport. But they can be expensive to maintain too, given that one council in London has introduced parking charges for motorbikes and scooters to fill up its coffers, based on the increasing number of motorcyclists in Central London. You can check out http://ukfrance.org/ to find out more.
    It might be best after all to walk, it’s good exercise and it’s free, so far :)

  27. Sherman

    If you can live without your car, sale it for some extra cash if that’s what you need.

  28. Rusty

    A car is more of a necessity than a luxury nowadays (why do we pay that ‘luxury tax’ then?). If you can go without a car then definitely do it… it’s not worth the hassle or the money. However, if it’s a ‘maybe’ I firmly believe you must have a car. A ‘maybe’ means that with a car you’ll have more time for yourself, which means more time. Time is money isn’t it? You can’t count it but a car is worth more than face value.

  29. Barry@Yurt Camping

    I live right out in the sticks and have to spend alot of money on fuel – I really wish I didnt, but I have to in order to get anywhere. Here in the UK fuel is at about £1.20 a litre. We burn over £500 worth of fuel a month!! What a rip off.

  30. yurt

    yeah-thats a tough call…Rochester is def not the city…I know I could prop never live without a car!!!