Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
How do you calculate the cost of driving?
Old 12-23-2009, 10:45 AM   #1
Full time employment: Posting here.
GoodSense's Avatar
 
Join Date: Jul 2007
Posts: 678
How do you calculate the cost of driving?

I am wondering how others calculate the real cost of driving. I haven't seen this on other threads but please point me to the link.

I have always figured that it costs $0.30/mile in my 1999 Lexus, which gets about 20 miles/gallon. My math is as follows:

1. Gas: 20 miles/gallon at $2.60/gallon => $0.13 /mile
2. Maintenance: $600/year for 12,000 miles => $0.05 /mile
3. Cost of buying a car: $18,000 for roughly 150,000 miles => $0.12/mile

Total = $0.30/mile

I know the IRS deductible rate is higher, but I figured thatís more for tax reasons.

I was going to drive 500 miles roundtrip to see family over Christmas, which realistically would cost $150. I found that the bus fare is less than $100. Given the prediction for bad weather, I think itís a better choice.

So how do you calculate the cost? Did I miss anything?


(Sorry, I don't know what happened to the font! )
__________________

__________________
GoodSense is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 12-23-2009, 10:51 AM   #2
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
REWahoo's Avatar
 
Join Date: Jun 2002
Location: Texas Hill Country
Posts: 42,123
Quote:
Originally Posted by GoodSense View Post

Did I miss anything?
I don't see anything about the "cost" of who you could be sitting next to on that bus vs. in your car...
__________________

__________________
Numbers is hard

When I hit 70, it hit back

Retired in 2005 at age 58, no pension
REWahoo is offline   Reply With Quote
Old 12-23-2009, 10:53 AM   #3
Thinks s/he gets paid by the post
MasterBlaster's Avatar
 
Join Date: Jun 2005
Posts: 4,359
I would include the following just for fun:

1) registration fees
2) The carrying costs (opportunity costs) of having capital tied up in your (used) car.
3) Insurance costs
4) parking and tolls (if any)
__________________
MasterBlaster is offline   Reply With Quote
Old 12-23-2009, 10:54 AM   #4
Thinks s/he gets paid by the post
 
Join Date: Nov 2009
Posts: 3,871
You left out the cost of auto insurance, a big cost. If you drive 10,000 miles a year and pay $1,000 a year for your insurance (yes, both can vary a lot depending on what you use your car and where you live, etc.), then that will add $0.10 a mile.

In some areas, you will pay a car tax every year. You may pay costs for registration and inspection and drivers license. You might pay to park your car, at your residence, at a parking lot (i.e. train station), or at your workplace.

You might pay highway and/or bridge and tunnel tolls to get to or from where you are going.

And if you are unlucky, you might get traffic or parking tickets
__________________
scrabbler1 is online now   Reply With Quote
Old 12-23-2009, 11:06 AM   #5
Full time employment: Posting here.
GoodSense's Avatar
 
Join Date: Jul 2007
Posts: 678
Ahhh, insurance! How could I possibly forget that! It's a big chunk of $$$.

OK, now with all the other costs others have suggested, it's more like $0.40/mile.

I just hope I don't have to sit near someone who smells bad, or a crying baby.
__________________
GoodSense is offline   Reply With Quote
Old 12-23-2009, 11:07 AM   #6
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Nov 2007
Posts: 7,530
For go/no-go decision-making purposes on a particular trip or whether to substitute another mode of transport, I look at it from an economist's standpoint:

Marginal cost of car usage.

so:
1. Gas: 30 miles/gallon at $2.50/gallon => $0.083 /mile
2. Maintenance: $600/year for 12,000 miles => $0.05 /mile

Or $0.133/mile for each additional mile I drive. For a 300 mile round trip, that is roughly $40.

The auto insurance, tax, registration, tag, inspection and depreciation* are all "sunk costs" that will occur regardless of whether I drive a million miles this year or 1 mile. Since I don't drive a lot, some of my maintenance is a fixed cost, since I do some maintenance items based on time between services instead of mileage. Add tolls in the calcs if applicable to your area.

* Technically the more you drive a car the more you depreciate it since it wears out more. But my car is at the age where the cost of depreciation per mile driven is very low. If you have very new cars and trade frequently, or have a leased car with a mileage cap, your economics will be different.

I have to make business trips for work occasionally, and I get reimbursed $0.55 a mile (in 2009), so with a marginal cost around $0.13 a mile, I know I am making a killing (tax free) on the mileage I get. Hence I don't mind driving my personal car for work.
__________________
Retired in 2013 at age 33. Keeping busy reading, blogging, relaxing, gaming, and enjoying the outdoors with my wife and 3 kids (5, 11, and 12).
FUEGO is offline   Reply With Quote
Old 12-23-2009, 11:15 AM   #7
Thinks s/he gets paid by the post
 
Join Date: Jan 2006
Posts: 2,931
It's a bit tricky too how you think about a cost of an additional trip because you have both variable and fixed costs.......once you buy the car and insurance/registration, the cost to drive an additional mile is probably a lot less since it only involves the variable costs like gas and maintenance. The cost of the car could be considered a fixed cost if you trade in every few yrs since depreciation will occur even if you don't drive it. It might be considered a variable cost tho if you own it forever and every mile you drive it reduces its life.
__________________
kaneohe is online now   Reply With Quote
Old 12-23-2009, 11:22 AM   #8
Thinks s/he gets paid by the post
 
Join Date: Nov 2009
Posts: 3,871
Some insurance companies charge you more if you drive more, not necesarily on an incremental basis. But if you drive 15,000 miles a year, you may pay more for your insurance than if you drive 5,000 miles a year. Furthermore, using your car to drive to/from work will raise your insurance coasts than if you drive it for "pleasure use."

[Before I retired last year, I worked for 23 years in the actuarial department of a trade group representing insurance companies, specializing in personal auto insurance.]
__________________
scrabbler1 is online now   Reply With Quote
Old 12-23-2009, 11:30 AM   #9
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
haha's Avatar
 
Join Date: Apr 2003
Location: Hooverville
Posts: 22,386
I see it like Wahoo. Have you been in any bus terminals lately? Lots of drug dealing and other nasty items to be wary of. Your actual variable costs of this trip are minor, to me it would be drive unless the weather angle is pretty bad.

And imagine getting marooned with a bus full of typical Hound-Riders. Yikes!

Ha
__________________
"As a general rule, the more dangerous or inappropriate a conversation, the more interesting it is."-Scott Adams
haha is offline   Reply With Quote
Old 12-23-2009, 11:51 AM   #10
Thinks s/he gets paid by the post
 
Join Date: Nov 2005
Location: North of Montana
Posts: 2,753
Quote:
Originally Posted by haha View Post
I see it like Wahoo. Have you been in any bus terminals lately? Lots of drug dealing and other nasty items to be wary of. Your actual variable costs of this trip are minor, to me it would be drive unless the weather angle is pretty bad.

And imagine getting marooned with a bus full of typical Hound-Riders. Yikes!

Ha
Or maybe this guy?
__________________
There are two kinds of people in the world: those who can extrapolate conclusions from insufficient data and ..
kumquat is offline   Reply With Quote
Old 12-23-2009, 11:59 AM   #11
Full time employment: Posting here.
GoodSense's Avatar
 
Join Date: Jul 2007
Posts: 678
Yeah I read the scary story. I figured that chances are pretty small I will be decapitated, and it could happen at a gas station or a shopping mall, too.

The weather was the main driver. There is predicted to be 20 inches of snow, mixed with rain, which will then turn into sheer ice. I don't have an SUV. I think I'll be safer on the bus even with less desirable travel companions.
__________________
GoodSense is offline   Reply With Quote
Old 12-23-2009, 12:11 PM   #12
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
brewer12345's Avatar
 
Join Date: Mar 2003
Posts: 16,391
I don't.
__________________
"There are three kinds of men. The one that learns by reading. The few who learn by observation. The rest have to pee on the electric fence for themselves."



- Will Rogers
brewer12345 is offline   Reply With Quote
Old 12-23-2009, 12:17 PM   #13
Thinks s/he gets paid by the post
 
Join Date: Nov 2005
Location: North of Montana
Posts: 2,753
If your weather prediction comes true, you'll be spending Christmas on the bus. Take lots of food and drink.
__________________
There are two kinds of people in the world: those who can extrapolate conclusions from insufficient data and ..
kumquat is offline   Reply With Quote
Old 12-23-2009, 12:19 PM   #14
Thinks s/he gets paid by the post
Bimmerbill's Avatar
 
Join Date: Jan 2006
Posts: 1,631
I don't either. Gotta drive to work, no way around it. I keep pushing for the telework option, but nothing is set up yet.
__________________
Bimmerbill is offline   Reply With Quote
Old 12-23-2009, 12:20 PM   #15
Moderator
Walt34's Avatar
 
Join Date: Dec 2007
Location: Eastern WV Panhandle
Posts: 16,544
There is also the added value, for whatever price you choose to put on it, of being able to follow your own schedule and have a vehicle at the destination.

And if I had to sit next to a stinky street person or crying baby for 500 miles on a bus they'd better pay ME! I can't imagine what situation would make me so desperate to get somewhere that I'd put myself in that position.

Given the choice of 500 miles of snowy driving or staying home I'd take the latter.
__________________
I heard the call to do nothing. So I answered it.
Walt34 is offline   Reply With Quote
Old 12-23-2009, 12:24 PM   #16
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
brewer12345's Avatar
 
Join Date: Mar 2003
Posts: 16,391
Quote:
Originally Posted by kumquat View Post
If your weather prediction comes true, you'll be spending Christmas on the bus. Take lots of food and drink.
Make sure you have enough to share.
__________________
"There are three kinds of men. The one that learns by reading. The few who learn by observation. The rest have to pee on the electric fence for themselves."



- Will Rogers
brewer12345 is offline   Reply With Quote
Old 12-23-2009, 01:32 PM   #17
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Nov 2007
Posts: 7,530
I took the greyhound from the east coast to the mexican border waaay back during college. It was an experience. I spent roughly half a day sitting next to an ex-con that literally just got released from prison that morning (10 year stint for attempted murder - stabbed somebody half to death but "she needed stabbing" ). Other than the hour or so he spent continuously informing me of the location of the best donkey shows and "boys towns" in all the mexican cities along the border, it was a pleasurable encounter. Interesting fellow that I would never have encountered otherwise. He had some interesting stories and added a lot of flavor to an otherwise at times bland trip.

Then there were the multiple times heavily armed police, DEA and/or immigration police boarded our bus to check for illegals, drugs, etc. At one point in Fayetteville, NC the bus station manager even had the courtesy to belligerently berate us that if we had drugs, they were bringing the dogs on the bus and you are going to prison. No one admitted to it and no dogs came on the bus, so it was clearly an idle threat THAT time. Thank goodness for my blanco skin, since that was a get out of jail free card in a later encounter with drug sniffing dogs (no crime was committed FYI)!!

It was an experience. Kinda reminded me of riding the school bus during high school, except Greyhound didn't have as many shady characters on it. My wife still swears the seats caused her to have achy knees.
__________________
Retired in 2013 at age 33. Keeping busy reading, blogging, relaxing, gaming, and enjoying the outdoors with my wife and 3 kids (5, 11, and 12).
FUEGO is offline   Reply With Quote
Old 12-23-2009, 01:46 PM   #18
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
RonBoyd's Avatar
 
Join Date: Dec 2007
Location: Denver, Colorado
Posts: 5,280
A clumsy awkward Google Search on "cost of vehicle" +calculation produced this:

What that car really costs to own
__________________
"It's tough to make predictions, especially when it involves the future." ~Attributed to many
"In theory, there is no difference between theory and practice. But, in practice, there is." ~(perhaps by) Yogi Berra
"Those who have knowledge, don't predict. Those who predict, don't have knowledge."~ Lau tzu
RonBoyd is offline   Reply With Quote
Old 12-23-2009, 03:45 PM   #19
Recycles dryer sheets
 
Join Date: Sep 2009
Posts: 353
Couple comments in addition to what was said before (sorry if I missed them). Don't know how you'd value these but...

Pros of driving:
- It's faster. In my experience bus trips take ~ twice as long on the road (depending on extra stops), not to mention extra variable time waiting at the platform.
- It gets you where you want to go, instead of having to transfer to local transport, or having someone wait for you on the other end.

Pros of going by bus:
- Safer (driving wise) - I trust bus drivers skills more than I trust myself (plus in case of accident it may help being in the larger vehicle and not in the one getting squished)
- You can read something or listen to something and just relax instead of worrying about slippery road ahead
__________________
smjsl is offline   Reply With Quote
Old 12-23-2009, 03:58 PM   #20
Thinks s/he gets paid by the post
ls99's Avatar
 
Join Date: May 2008
Posts: 4,792
Quote:
Originally Posted by brewer12345 View Post
I don't.
+1.

I keep track of mileage, out of habit and curiosity and a the fun of of seeing how many miles per $. Which varies with gas price mostly.

Our supermarket owns a few gas stations and we get some cents off on gas depending on what we spent in the market. Have gotten gas for as low as 20 cents/gal recently, typically in the $1/gal savings range if save the credits long enough. Mostly the savings go to DW's car since she does most of the shopping.

ADD: having worked in the transit business, I know what critters/bugs are in the seats. Especially the last row.
__________________

__________________
There must be moderation in everything, including moderation.
ls99 is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
How do you calculate the value of a pension? cvoz FIRE and Money 19 06-03-2008 07:24 AM
Calculate a remainder interest? pedorrero FIRE and Money 5 07-22-2007 09:13 PM
How do I calculate the value of a pension? martyb FIRE and Money 19 12-11-2006 07:53 PM
How do you calculate your portfolio performance? Surfdaddy FIRE and Money 13 04-13-2006 08:32 AM
How do you calculate a lump sum? debster FIRE and Money 4 10-28-2005 03:35 PM

 

 
All times are GMT -6. The time now is 11:10 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.