Walking to Early Retirement

The Walking Path to Early Retirement

budget, cut expenses, debt, early retirement, expenses, financial independence, FIRE, frugal, get out of debt, vehicles

There are three major questions that we must answer:

  1. Where will I live?
  2. What will I eat?
  3. How will I get from the place that I live to the place that I work/purchase food/etc.?

In this post we will tackle the inevitable costs of transportation. With the exception of those that live in a major metropolitan area and can walk, bike or use public transit, the majority of our country commutes by car.

When Mrs. Winning Williams was in college she was one of the few and lucky people who had no car and no bike. She walked or took the Philadelphia subway system wherever she needed to go and occasionally bummed a ride with a friend if it was absolutely necessary. Mr. Winning Williams though grew up in the Tampa, Florida area. Now I’m sure you might be thinking that Tampa is a major city, surely they have reliable public transportation. NOPE! (there are several factors impacting this, but Tampa is a nightmare for public transportation and pedestrian commutes). If the constant construction on the roads wasn’t enough, sidewalks and streetlights are sparse and the state turned down funds for a light-rail system that could have alleviated some of this problem.

Why am I going to such lengths to demonstrate the point? Florida is not a pedestrian friendly state, meaning you pretty much need a car to get around. AND, Florida has one of the highest rates of uninsured motorists, meaning that car insurance in Florida is especially high. All of these factors add up and tack on a lot to a budget. While we had been trying for years to get our monthly and yearly expenses down we constantly hit a wall when it came to costs related to commuting. The insurance, gas, tolls, wear-and-tear on the vehicles were a huge part of our budget.

Commuting is VERY expensive, and not only on our wallet, but it’s also known to result in greater levels of stress and even contribute to obesity.

According to AAA in May 2014, the average cost per mile of a sedan was 59.2 cents per mile and of a SUV was 73.6 cents per mile. Based on 15,000 miles driven in an average year, that could be somewhere between nearly $9K and over $11K in expenses per year AND per vehicle. A material part of this expense is depreciation. This can be controlled by purchasing a quality older used vehicle, maintaining it properly, and driving it for a significant period of time. It also means buying a vehicle that suits your purposes. My guess is that most of you don’t need the off-road benefits or size of a SUV; the larger vehicle costs you an extra $2,160 per year at 15K miles driven.

In 2014, here is what our commutes looked like and cost us:

Mr. Winning Williams (Toyota Camry)

30 mile to work commute (60 miles/day at 5 days a week)

  • 15K work miles and 3K other driving – 18K total miles driven in 2014
  • $10,656 – 2014 cost if using the 59.2 cents per mile calculation (x 18K miles driven)
  • However, this includes insurance (which must be maintained), higher Depreciation than realistic as the car was purchased used and will be driven for a significant amount of time, etc.
  • More realistic cost per mile for Mr. Winning Williams is $0.26 / mile = $4,751 in 2014 cost (excluding insurance)

Mrs. Winning Williams (Jeep Liberty)

10 mile to work commute (20 miles/day at 5 days a week)

  • 5K work miles and 2K other driving – 7K total miles driven in 2014
  • $5,152 cost of using the 73.6 cents SUV per mile calculation (x 7K miles driven)
  • Most realistic cost per mile for Mrs. Wining Williams is $0.44 / mile = $3,185 in 2014 cost

While we knew the commutes were costly and time consuming (Mr. Winning Williams averaged 2 hours per day commuting and Mrs. Winning Williams averaged 1 hour per day commuting), we were at a stalemate, by moving one of us would continue to have a bad commute given the distance between the jobs.

Then in January of this year, Mrs. Winning Williams took a new job. This job change finally provided us with the long-awaited opportunity to change our commuting situation, by leaving our house and moving into a smaller condominium complex. This moved us significantly closer to Mr. Winning Williams’ job. He no longer has to pay tolls, his gas expenditure and wear-and-tear have decreased materially, AND we get to enjoy more time together in the mornings and the evenings. What a win for the Williams!

Walking to Early Retirement

Walking to Early Retirement

What about Mrs. Winning Williams you may ask? Well, we were able to move in next-door to her new job. That’s right- she walks EVERY DAY. In a town where no one walks, Mrs. Winning Williams walks to work. With the daily pedestrian commute for Mrs. Winning Williams, it made no sense to keep the second car, so we sold it. Since it was a hand-me-down from Mrs. Winning Williams’ mom we sent her the money that we received from the car and celebrated a Win-Win for us and a Win for her Mamma. Win-Win-Win!

Looking at our new estimated 2015 car spend:

Mr. Winning Williams:

$2,860 ($0.26 / per mile * 7,500 work miles + 3,500 other driving miles) = $1,891 savings over previous year (2014)

Mrs. Winning Williams:

$0! $3,185 saved over previous year! PLUS a reduction in insurance of $1,050.

Total Winning Williams savings = $6,126

PLUS – HUGE TIME SAVINGS (something we all want and need more of!):

Mr. and Mrs. Winning Williams EACH save 1 hour (or more) of commuting per day or 5 hours per week. For the year that means, 250 hours of extra time or the equivalent of 6.25 less working weeks (based on a 40 hour work week) for both Mr. and Mrs. Winning Williams! This has resulted in better and longer workouts and enhanced home cooked meals (and the start of the blog)!

Note: the move was crucial to our savings. This meant we gave up our cushiony 3-bedroom house which was near to family, for a much smaller (but still significantly large) one-bedroom rented condominium.  Without the move, the new job would have resulted in a much longer commute for Mrs. Winning Williams, increasing the commuting cost, and associated stress. The move therefore provided an awesome kick-in-the-ass towards further pushing ourselves to our early retirement, even better health, and new amazing environment.

But back to the vehicle expenses: it all comes down to understanding the full costs of car ownership and maintenance. There is never an inexpensive option, it will always cost you a lot of money in the long run, more than you realize, but if you elect to indulge in the luxury of driving you should consider these factors:

  • Cost of the car goes beyond the initial purchase. The car depreciates the second it has an owner.
  • Buy the car you need now, not the one you need in your fantasies. Unless a job requires you to haul massive equipment, you likely don’t need a big truck or SUV.
  • Registration and car insurance are regular costs. You have to budget for them.
  • Cars are machines that need regular maintenance. If you can do most of it yourself, great. But sometimes hiring an expert to do the job right for $40 is better than frying your entire electrical system for $1700.
  • Commuting takes hours from your day, years from your life and contributes to overall pollution. Don’t brag about your gas-guzzling vehicle. You don’t look rich, you look rude.

7 thoughts on “The Walking Path to Early Retirement

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