Time to save big by getting away from cars
A recent German study, which meticulously assessed the private and societal costs, found owners of small cars pay about $400,000 over their lifetime.
Some people are complaining about the price of fuel for their cars. The increase in cost from $2 to $3 a litre is likely to cost the driver an extra $750 to $1500 a year depending on how efficient their car is (five litres/ 100km v 10 litres/100km, respectively) and how far they drive (calculation based on annual travel distance of 15,000km).
But that is small change compared to the total costs of owning that car. A recent German study, which meticulously assessed the private and societal costs, found owners of small cars pay about $400,000 over their lifetime (and there’s another $200,000-plus of social costs they don’t pay). This was more than a third of lifetime income.
Buying secondhand cars only decreased the cost a little because although purchase cost was lower, maintenance and fuel costs were higher.
And halving the distance driven didn’t halve the cost as there are so
many fixed costs associated with car ownership.
You might say costs are higher in
Germany than in New Zealand but the costs considered were similar to those considered here and wages are generally higher in Germany so it probably evens out.
People in cities have plenty of transport choices, from walking by itself or in combination with public transport to cycling or scootering.
Whichever of these choices you make you’ll feel the benefit immediately and find making ends meet an awful lot easier. It’s probably time to make the switch.