Our family purchased two new Toyota vehicles over 10 years ago.  A few months ago, one of those vehicles became (in my view) to expensive to continue to maintain.   One of the mechanics did a major screw up causing several thousand dollars worth of damage to the car.   We ended up selling the vehicle and were thinking about buying a new one so we sat down and decided to do some math….

It turns out that for us, in our current situation, it is far cheaper to Uber to/from work than to buy a car.    We still have one vehicle that we share between us but we alternate having the car when we will need it for more than just a single trip from home/work or vice versa.

It turns out that Ubering will cost us about $400/month for daily service to/from work for my wife.  It is a bit more expensive for me since I work further away from home but even that additional amount is STILL cheaper than owning a car.

Most people don’t factor in all the expenses of owning a car: insurance, fuel, maintenance, and the cash outlay for the car itself and interest on top of that if taking out a loan.

So here’s the math.  Each trip is about $10 for my wife so that’s $20/day.   There are about 20 workdays in a month so that’s $400.  This averages about $100 week however it doesn’t factor the fact that I will occasionally drop off my wife when I’m heading to work or pick her up when our schedules sync.    Moreover, I travel frequently and work from home some days so she uses my vehicle when I’m out of town for a week or so every month.  That’s how we ended up with $200/month.

Even at $400/month there is no way to beat that “owning” a vehicle when factoring fuel, insurance and maintenance.   What really kills me is that buying a car is a huge capital expense and most of the time the car sits in the garage or parking lot.

By doing the math, it also turns out I discovered that Uber drivers really get screwed but their loss is my gain.   This article also points out Uber drivers end up making less than minimum wage.

Lastly, there are other intrinsic factors at play here.   The Uber driver is also assuming the liability of driving the car.  This not only includes getting into a car accident but also getting ticketed for traffic violations, parking, etc.   Personally, I really like being chauffeured around so I can do some work or take a call.

My suggestion to you is to do the math and figure out if you really need to own one or more cars in your household.   For people living where there is no Uber or too far away from work (i.e. living in the suburbs) you probably don’t have a choice but for us, it’s a no-brainer so far.

 

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