When people are looking to make big financial moves, they often look at making changes in larger ticket items in their lives: housing, insurance, and cars.
According to Nerd Wallet, the average price for car ownership was around $8,000 a year. Especially in cities like ours with expensive parking (some places anyway!) and public transportation options, it can be tempting to get rid of your car, temporarily or permanently. Here are some things to consider if you want to explore the idea of living carless in Chicago.
Step 1: Calculate how much a car costs you versus save you money.
It’s pretty easy to think of the ways a car costs you money:
- car payments
- registration and inspection
If you add these up for yourself, and average them over a typical year, you’ll have a really good idea of your monthly costs.
What we don’t often compare this to is how your car saves you money. Here are some things to think about:
- useage your car for work (ex: you get reimbursed for miles traveled for work)
- shopping in a more discounted way (ex: you can travel to a store that’s a bit out of the way to save on your weekly grocery budget)
- making money off your car directly (ex: driving for a rideshare service, more examples if you click this link)
Most people upon doing the math may see that while a car ‘costs’ them money, it can make up for some of its costs financially.
Step 2: Calculate regular and occasional driving tasks and what it would cost to do the same without a car.
The next step to get a clear picture of car costs is to figure out your transportation patterns and how you would accomplish them without a car.
For example, you might find your office (which you go to five times a week) is on a bus route and a $105 monthly pass would work for that while you could probably ride share your once a week trip to the grocery store. (Click here to learn more about the different ride share and taxi systems in Chicago.) You might also ask around and find that your friend wants to volunteer with you at your weekly regular spot and is happy to give you a ride.
Knowing how much your life costs you with a car (step 1 above) and how much it would cost to keep your life as is without a car, might be a helpful comparison.
If you decide it’s a big enough difference to you, you can do a trial run:
Step 3: Try a test run for a week.
Pick a week and act as if you don’t have a car, no matter what. You may notice things unexpectedly come up, like not being able to meet your friend for lunch last minute or noticing you didn’t have to circle the block three times to find a parking spot at your appointment. Write down at the end of every day what worked and what didn’t about not having a car, not just financial costs but what you noticed about how your life was different. You might be surprised what does (and doesn’t) bother you… and I’ll bet you’ll have a really good idea about whether having a car works for you!
Step 4: Consider what to do with your car if you decide to not have one.
If you are getting rid of your car, you can obviously sell it or donate it. (If you are leasing a car or have car payments, you might be a bit restricted in how you can do this so in your case, you might decide the timing if your car free decision is important.)
If you’re worried about getting rid of it outright for now, you do have other options, like storing it (this might negate some of your savings) or loaning it to someone (ex: graduate student living in the area temporarily).
Whether you decide to go car free or continue driving around Chicago, at least you’ll know you’re doing the best thing for yourself and your finances.