Financial Savings
That is what we save every year by not having a car. The final amount amazed me after running the numbers this week. I sat down to analyze the situation as I am now two months into my new job and wanted to see if it made sense for Amy and me to consider purchasing a car. Maybe it would be more cost effective, after all the daily train tickets cost me $26.07[2] every time I go to my office in New Brunswick, New Jersey. It also should not be surprising that I wanted to involve excel in this calculation, as I did with the Beast on our U.S./Canada road trip.
Once I factored in the cost of buying the car[1], maintenance, insurance, gas, and the loss of our monthly rent from our parking space, the cost of the train, Zip Car and occasional rental car didn’t even come close. And that is with rather conservative assumptions on the cost of gas ($3.50/gallon) and car maintenance ($150/month). The details are below and if anyone sees a mistake or an assumption that is out of whack, call me out on it in the comments below. I want to ensure this analysis is robust and credible.
Carbon Savings
I also thought I would look at the carbon savings and impact of choosing to not have a car. My research led me to CarbonFund.org, where I was able to compare the carbon impact of my train commute vs the same commute in a car. For this part of the analysis I only compared the 12,000 miles that would make up my commute to New Brunswick, New Jersey. The other 8,000 miles we would use a personal car for are also likely to be used with Zip Car or rental cars for longer trips so no savings is to be had there. Turns out the savings was much less than I had thought, only 1.72 tons saved each year. And if I tried to “sell” that carbon credit, I would be able to “monitize” my carbon savings at current rates of $10/ton to a whopping $17.20 annually.
Time Savings
While the financial savings are great, and a big reason we will not be buying a car anytime soon, there is another great benefit to commuting on the train: not having to drive. The benefit of not having to actively engage in your commute is huge when your commute is 2 hours each way. One of the first things I bought in my new job was an extended battery for my laptop so I am able to be productive while commuting. I snapped the picture below of a fellow work day commuter who was also using the train time to polish a presentation. On the days when I just can’t bear the idea of another powerpoint, I am able to sit and enjoy the scenery.
So are you ready to sell your car and take to the trains? Can you make due without a car? For most Americans that do not live in a city it is likely not possible, but understanding the costs you assume when choosing to live where you do is critical, and for us to move out of the city we need to understand that the need to have car is an expensive choice.
[1] I have assumed a 2011 Mazda 3 Grand Touring Hatchback, the new version of the car we had previously, for this analysis, including purchase price and MPG.
[2] Factors in tax impact of 21% reduction due to use of the pre-tax Commuter Check program offered by Johnson & Johnson.
{ 6 comments… read them below or add one }
As a train commuter since September (Edison to Jersey City) I cannot believe people that have the option for the train will often still drive. We have not gotten rid of a car – but I go 2 weeks or more before having to put gas in it (Mustang GT – so it eats a lot of gas). Train lets you relax – and on days like today – you can start Happy Hour before you even get home! I know many people do not have the option – so different story for them – but train is the way to go.
John – I agree with that Happy Hour idea. I have yet to take it to fruition outside Amtrak, but always the potential.
yeah I would agree that those with cars unless they really need them are really wasting a lot of money. Well then is just my opinion since some people may view money spent on travels as not being needed.
Wow…that is quite the savings! You didn’t count parking costs – if I drive my car to work I also have to pay to park it there. Is the time you mentioned actually saved? Would it take you that long to drive? I get that the time spent on the train can be productive but if it doubles my commute I don’t care how productive it is b/c I’m not at home relaxing with a beer!
I love it, Keith, that you take an honest look at the economic value of being green. I read a report the other day that said that consumers are all over being green but only if it works for their pocket book and I would agree whole heartedly. I will choose an environmentally friendly alternative only if it works for my situation and my wallet. Companies/products need to realize this as we move forward.
Gillian – good point on something I did not address. The time is mostly saved, the drive would on average probably save me 15 mins over the train, so about a 12% increase, but there is a lot more variability driving than with the train so it is a trade off I think is well worth it. And taking John’s comment to heart you can always plan ahead a bring an adult beverage on the train for an early start to happy hour! Also no parking costs, J&J provides a free lot for employees in New Brunswick, although maybe they should start charging….
Also I truly believe that all sustainable solutions must be economically viable on their own without subsidy to have a chance of broad adoption. Must be my economics degree coming through, but I don’t think products that relies on a price premium, with out added benefits, can be successful in the long run.
If there’s an option to walk or ride a bike, I won’t take a car.