Car-Free Family: How Much Can You Save by Ditching Your Vehicle?

Family of 5 Ditches their Car
WhenEliseSings under CreativeCommons

On a recent weekend, my husband and I took our kids across San Francisco Bay to go ice skating in Union Square, then to a friend’s house for dinner. We got home so late that our 7-year-old fell asleep — on the transbay bus.

Friends often marvel that we live outside the city but choose not to own a car. The truth is, we have fun taking our three kids, who range in age from 5 to 10, on family outings by bus, bike, train and ferry.

How do we survive without a car, and how much is it saving us? Here’s a breakdown.

Our Car-Free Life

I understand that car-free living isn’t something that everyone could start doing tomorrow.

The biggest change we made to enable this lifestyle was choosing a new neighborhood: When we relocated for work three years ago, we sought out a location that had stores, schools and public transit within walking or biking distance. We also happened to relocate to the San Francisco Bay Area, where it’s never too icy to bike or too cold to walk.

Even though we hoped to walk and bike as much as possible in our new neighborhood, we had never expected to be able to go without a car altogether. We sold our loyal old beater before moving because we didn’t want to drive it across the country, and we figured that we would buy a new vehicle after getting settled in. But as months passed without a pressing need to drive, we decided that buying a vehicle was not a financial priority.

When we want to drive, we rent the perfect car for our needs, like the four-wheel-drive vehicle we’re taking to Lake Tahoe this weekend, or the convertible my husband and I took on a wine country day trip. And we get much more exercise than we would if we had a car sitting out front.

It’s not always fun to be car-free. While weeks go by when I don’t even think of driving, occasionally we will get hit with a circumstance like a late bus to ice skating lessons that forces me to borrow a friend’s car at the last minute. Fortunately, I’m a good friend who does a lot of favors for others, so no one begrudges us this occasional indulgence.

Beyond the benefits to our lifestyle, not owning a car saves us money in multiple ways each year:

The Cost of the Vehicle: $9,000

This is a tough cost to figure out, because the car we didn’t buy could be anything from a 10-year-old sedan bought with cash to a luxury sports car purchased on credit.

Since our favorite car to rent is a late-model Ford Flex, I used the payment calculator at Ford to get an estimated monthly payment of $753, or $9,036 a year, with a 1.9% APR paid over 48 months.

Another way to look at the cost of the car is to calculate annual depreciation: Our car of choice with a typical loan would cost us $5,654 a year in finance charges and depreciation, according to AAA,

Maintenance: $500

One thing I love about renting instead of owning is that I never have to visit an oil change shop, buy tires or have a mysterious clunking sound investigated.

If we owned the kind of car we like to rent, AAA estimates that maintenance would cost us 5.5 cents per mile. Assuming we drove 10,000 miles a year or less, that would add up to about $500.

(Of course, car owners can save a lot on maintenance by doing it themselves and by carefully shopping for repair services.)

Insurance and Registration: $1,905

Putting aside the one-time cost of sales tax, my car of choice would cost me about $359 per year to register in California. GEICO gave me an annual insurance quote of $1,546.

Fuel: $1,175

Today’s gas prices are pretty low — about $2.35 in my area. Still, my vehicle of choice only gets about 20 miles to the gallon, so to drive 10,000 miles this year would take 500 gallons, adding up to a substantial $1,175.

Tolls, parking, etc.: $1,450

The minutia of driving adds up, too. There’s a $6 toll to cross the Bay Bridge, and parking rates in my area start at $1 an hour and go way up from there.

My guestimate for this expense assumes that I would spend about $25 a week on tolls and parking, and incur two parking tickets a year costing $75 each.

How Much We Save By Going Car-Free

Add it all together, and owning a car would cost my family about $14,000 a year. That amount would go way down once we paid off our car, but, having become used to driving brand-new rentals, we don’t especially like driving older cars.

Not everyone’s cost would be this high; we live in an expensive area. AAA estimates that owning and driving an SUV typically costs $12,446 a year, and others estimate that it costs about $8,000 a year to own and drive any car.

Of course, we still have some car-related costs, in the form of rentals, car-share services, taxis, and gas, parking and tolls for rented and borrowed vehicles. However, all of those costs are lower than they would be if we owned a car, because we drive a lot less than we would otherwise.

We bike or bus places we might have driven, and we skip a lot of little trips that we might have taken if we had a car handy. These other forms of transportation have their own costs, but what we spend on transit fares and bicycle purchase and maintenance is much less than we’d spend on a vehicle.

I counted up all that we spent on transportation in 2014, added 20% to account for anything I might have forgotten about, and came up with $2,500. About half of that amount was spent on renting cars. I didn’t include my husband’s daily commute to work because he would be taking public transit into the city whether we owned a car or not.

By this measure, my family saved $11,500 by not owning a car this year. Even if we already owned a car without payments, we’d come out about $2,500 ahead.

Beyond the monetary savings, not owning a car simplifies our life. I never have to worry about our vehicle getting dented, broken into or stolen while we sleep. I never have to go to the car wash or get a smog check. Both the financial and intangible benefits make the occasional inconvenience of the car-free life well worth it for our family.

Your Turn: Could you live without your car? How much would it save you?

Carrie Kirby writes, blogs and leads Girl Scouts in sunny Alameda, California.