By: Revanche

Questioning my assumptions: do I need a car?

March 17, 2010

I was catching up on my Consumerism Commentary when something Flexo said held my attention: “I believe there are several stages to becoming financially secure or independent. There may be a time where it makes sense to save every cent possible…… I had to survive without a car (relying on friends and public transportation), eliminate cable television, and share an apartment with three roommates. Now that I’m earning more than what I need for basic expenses and long-term saving and investing, I don’t have to be as tight. I willingly give up some income in order to buy myself more convenience.”

Earlier this evening, while discussing the car hunt and the various finds under inspection, a friend asked me, “Do you really need a car? Public transportation won’t cut it?”

My initial answer was a glib “no, public transportation doesn’t quite cut it.”  Reading Flexo’s comment above pulled me up short, though. Is that true? Do I really need a car to supplement public transportation or am I taking the easy way out and spending more money I can’t actually afford for convenience?  *note: Flexo can afford to expand his spending horizons. I don’t mean to imply that he’s taking the easy way out.*

Since the search began, the budget grew to more than I’d wanted to spend because my requirements haven’t been met. If I’m spending enough to dip into the emergency fund, job or no, the decision has to be sound so I returned to the drawing board to rehash my reasons and evaluate their premises.

Reasons I thought I needed a car 

1.  Because of the Big Lie and the need to transport my personal effects, I needed a long-term car. A one-way rental is too expensive, a round-trip rental is a waste of time and I’d need to fly back.
 — Since relocation was successfully negotiated, I should be able to afford to ship personal effects and fly.
 Evaluation: Don’t need a car. 

2.  Driving would be easier due to potentially abnormal working hours.
—  I haven’t experienced rush hour in the metro areas yet so I can’t speak to that, but parking costs between free (minimal street parking) to $20/day depending on the various lots.  On average, $7/day, $140/month. 
Meanwhile, commuting options exist, though inconvenient.  The morning commute would require some combination of two buses and 1 rail system with a minimal amount of walking on both ends ($6.50 – 9.30/day) and travel time of 30 minutes.  If the location changes as promised, the new commute requires some combination of two buses and 2-3 rail systems with a minimal amount of walking on both ends ($7-9.30/day) and a travel time of 1.5 hours.
Evaluation:  The cost could actually be equal, given the trade-off between commute time/transfers and the wear and tear on the vehicle. 

3.  I’m choosing to find housing in more suburban areas for more affordability which also lends itself to free parking/no zoned parking.
 —  If I chose to live in the more urban area, I’d likely be in walking or biking distance of most nearby businesses such as restaurants or groceries, entertainment and shopping.  But not #4.
Evaluation: I need more data.

4.  My preferences for entertainment are far-flung and while potentially cheap or free, require that I be able to reach them somehow.
 —  I could always hole up in the room with a stack of books and become a hermit.  I’m kind of kidding. The reality is that my preference for entertainment is rarely to go out. I prefer to spend quality time with friends or animals. While that can be low-key, it can only happen if you’re mobile.
Evaluation: At first I thought: I spent several years being a hermit in the name of saving money and paying down debt.  But my social network won’t be strong enough to rely on friends for transportation.

5.  I need to be independently mobile.
— I need to keep costs to a minimum.
Evaluation: No car.

That last part is really a tosser, though, because I have to be honest – I rated the anti #5 argument higher because I’m afraid to stop being being hardcore, down to the bone, slasher frugal.  I’ve lived that way for years. Now that I have two (or 1.5 households) to pay for my instincts scream at me to stay that way.

Meanwhile, a competing sense of self(ishness) says that I’m old enough to be on my own and do what I want, and what I want is to be independently mobile.  Is my desire to Stop Sharing so strong that I’d pay the cost of another car?

Let’s face it, a car will cost a lot of money for someone who won’t be making serious bucks.

First, there’s the fixed cost of purchase.  Let’s say I go wild and plunk down $10k.  A little more than half of that was my tax refund and money saved for two years just in case I had to pay taxes.  So a little less than that comes out of the emergency fund.

Then we tack on a conservative $1000 for insurance annually.  We also have the costs of maintenance and repairs which are typically budgeted around $1500/year.  Remember now, that’s not just for the new car, that’s also for my old car which I remain responsible for.  So the insurance and maintenance budget has doubled.  Then of course, we have fuel, and since I live in CA we have fuel + $$.  Conservatively we’ll call it $100/month, with say, $70/mo for parking assuming I cannot always get parking for free.

Can I afford an annual Convenience Fee of $4540, while replenishing a $5000 hole in the emergency fund?
Probably.

Can I afford an additional expenditure of $4540/year without creating major drag on my savings goals for the year?

Well, unemployment already did a number on them so I honestly haven’t set any, but probably not.

To be fair, let’s compare the cost of public transportation commuting against that annual fee.
On the low end, 20 days a month, 12 months a year at $7/day: $1680 x 2 trips a day = $3360
On the high end, 20 days a month, 12 months a year at $9.30/day: $2232 x 2 trips a day = $4464 

I’ll be honest, I didn’t see the math playing out this way. I was pretty sure it’d come very firmly down on the side of public transportation.  Tolls (for driving) and fare increases (for commuting) were not factored in as they’re not predictable. In truth, even with the car, I’d likely be doing some pub transportation once I figured out that traffic and parking vagaries so these numbers (and the difference in cost) remain soft. With any luck that would bring the daily amount down on average by half. 

At the end of the day, after running the numbers, it’s partly a math and partly an emotional decision. If I’m willing to take the initial $5k+ hit to my net worth on the math side, then my emotional side argues for the buy as well.

I am, in essence, the personification of Newton’s Law.  When “at rest,” I tend to stay “at rest.” When I’m limited to sharing a vehicle on someone else’s schedule, I have been categorically a shut-in working on my projects indoors from dusk to dawn and back again, without a break. I leave on the spur of the moment and if that’s not possible then I just don’t bother.

Historically then, my sense of stability and productivity is found in part in my ability to go about my business at will, without wondering if the car’s been taken by the shared individual, without having to cut short my errands or reschedule to accommodate someone else’s schedule.  It is, I’ll admit, kind of ridiculous.  But that’s how I function and that’s what I have to work around.  And it’s kind of more ridiculous to refuse to make a purchase that is mathematically acceptable simply because I don’t want to backslide on my monthly numbers.

Note: the calculations for the car are based purely on the commute numbers, but clearly the car will be handy for longer road trips that are tentatively planned for later in the year.  Increased usage would increase cost but it’s the function of the car to be used.

16 Responses to “Questioning my assumptions: do I need a car?”

  1. I always try the low-cost way first. So I would see if I could do w/out a car. Also, if living in the city costs more in rent, but also means you can go car-free—it might be cheaper overall to be in town.

    Finally–do they have zipcars in your locale? These are for occasional rentals. It’s such a good idea.

  2. mOOm says:

    I don’t have a driving licence and so until 2.5 years ago when I started living with Snork Maiden, no car. So it’s definitely possible to live in a variety of places without a car but you have to choose very carefully where to live. We don’t use our car much and it is very expensive in registration, insurance, depreciation etc.

  3. Shelley says:

    I’m in the process of trying to wean myself off my car and I haven’t been able to do it yet. I lived and commuted to work for 4.5 years without a car, but now that I don’t work I can’t justify the price of a metro pass and I think the cost of individual journeys is quite high compared with the cost of gas. But not compared with the cost of gas and insurance, taxes and maintenance. I live in a suburb and find I want to go into the city several times a week.

    Once Bill retires I won’t have any trouble (I don’t think) with one car, but now with the distance he travels to work, if I don’t have my car, I will be either waiting for him to come home or I’ll be on the bus or metro.

    I don’t need a car, honestly. It’s just hard to give it up.

  4. Mrs. Micah says:

    We decided that we didn’t need 2, but we still have one to share, which is really convenient. However some of my DC friends have SmartCars or ZipCar memberships, which mean they can get mobility sometimes when they need it.

  5. Being in the suburbs of Jersey, we need a car. However, if I was single & my workplace is in a city, I’d rent in the city and live w/o a car.

  6. Aaren says:

    I grew up in Oakland and never needed a car. Transportation isn’t cheap, even for the discounted rates, but parking can be absolutely atrocious at times. Depending on where you are, you definitely want to look into it. I worked in SF for years and there is no street parking in the area. In 1999 parking was $18/day; I’d hate to think what it is now.

    I currently live in the DC area and my boyfriend and I have 2 cars. Could we survive on one? Probably, but since one is paid for in full and the other is 9 months away from full payment, we keep both. I survived for 4 years without one here too, so it can definitely be done. That said, I’m not sure I’d want to do it again, so I feel where you’re coming from!

  7. Abigail says:

    Since your budget grew and you’d have to dip into the EF, why not give it a month or so? It’d allow you to save up more in case the car is necessary.

    Frankly, given the sheer number of transfers, I think it’s reasonable to want a car. But since you could potentially relocate to something more urban (consider increasing rent a bit by the decreased cost of transportation), I’d say check that option first.

  8. What a long post. But yes, I think you do need a car from time to time. To be honest, my best friend doesn’t have a car and it became quite annoying when the time comes to ask me for a ride.

    I spoke with other friends and they shared the same sentiment but they just didnt want to be rude and not tell it to her face.

    But if you’re able to live off public transportation, that is amazing too! I might just find it hard when time comes to shop for big items and you just can’t lug it around on the bus. But then again, I guess you can ask your friend for a ride at that point in time.

    But I would say go get a used car. You only live once! So enjoy and get around freely.

    http://moneyhoneysf.blogspot.com/

  9. eemusings says:

    “And it’s kind of more ridiculous to refuse to make a purchase that is mathematically acceptable simply because I don’t want to backslide on my monthly numbers.”

    I think in this case it comes down to what YOU want to do. Car ownership isn’t cheap, but the benefits are pretty huge especially once you’ve owned one before and you’re moving to a totally new area.

    Maybe it would be a good idea to try out using PT and zipcar at first, so you don’t have to rush into buying a car right away.

  10. Ciawy says:

    If I’m in your situation and have “some” money to spare for a car, I would buy a car. Most likely the type which I don’t have to pay a monthly payment – a used car perhaps until I’m able to get a better one. Living in California without a car is no joke, unless you live and work in San Francisco where you can cab it during the wee hours of the night/day. Plus, having 3 transfers will really be tough.

    Whatever you decide, good luck!

  11. sahmcfo says:

    Public Transportation definitely is not cheap, my husbands monthly pass is $181 a month! But his commute is very convenient, yours sounds like it would be nightmarish! One late connection and you’re toast…

  12. Waitaminit here. Are you moving to the Bay Area, or are you going further north to someplace like Eureka?

    If you’re going to live in the City or even the East Bay, consider the possibility that you can combine public transit with occasional car rental. When we lived in London, where the public transportation is comparable to San Francisco’s, we knew people who used the buses and the Underground most of the time but when they wanted to do a major shopping trip or go off for a weekend drive would rent a vehicle. My ex-brother-in-law used to do the same thing when he lived in Manhattan.

    If, however, you’re not planning to live in the City–or maybe in Berkeley or Oakland, don’t even think about trying to get by without a car.

    You probably can buy a drivable car for less than 10 grand. Consider looking in Arizona or Nevada, where prices may be lower, and driving the clunk back to where you’ll be living. My son would be happy to sell you his for $3,000 OBO. 😉

  13. You should also consider the fact that if you have a car, you might feel more inclined to go places (so it isn’t a matter of need at this point, it is a matter of ability.)

    I understand your emotional argument, which is why I long for a car of my own. But I realize the cost would be too great to me; aside from living outside the city, but spending most of my time in the city, I have access to 2 cars (BFs and My parents’). I mean, why spend for a car at that point?

    But back to you, I think you should consider also all the things you could be doing with a car, and all the things you can’t and can do with public transportation.

  14. Carolyn says:

    My vote is for car 🙂 Don’t ask me why though! You know I’m not good with numbers. 😛

  15. I think you need a car. 🙂

  16. em says:

    about 2 yrs ago i was in car crash and subsequently left carless. some points
    – not to be a total shut-in but the crash (not my fault) made me realise cars are a little dangerous.
    – i live in a big city and parking was a total nightmare, expensive and hard to come by
    – i live downtown, so i walk to work anyways. i think the tradeoff of having a smaller apt is worth the time saved commuting, i cant stand being stuck in traffic
    – being carless resulted in me buying a bike, which (not to sound too corny) has brought endless joy. also, bike repairs are much cheaper than car repairs. plus its way more social and obviously good exercise.
    – being a bit of a greenie, i dont agree with the non-hwy use of the combustion engine. i do occasionally rent a car if i am heading out of town, on the free way.
    – not having a car made me be more of a local shopper. it also limited shopping trips to places like ikea, costco to buy stuff i probably didnt need. also made me reevaluate purchases as i knew i had to get the home by foot or by bike (i.e. groceries).
    – cost of gas, insurance, repairs, car payments… i would rather invest that cash. and i do.

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