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L<\/span>ook out of your nearest window, and there\u2019s a good chance you\u2019ll see several expensive tonnes of metal, glass, and plastic sitting idle.<\/p>\n In fact, I am doing that right now.<\/p>\n It wasn\u2019t always this way for me. In the early phases of my investing journey<\/a>, I managed to avoid the expense and responsibility of owning my own car.<\/p>\n But I could only hold out so long. And between work trips and the need to transport kids quickly and safely, the debate now isn\u2019t whether we need a car\u00a0\u2013\u00a0it\u2019s whether we need a second.<\/p>\n Unless you live in a big city with a spiderweb of public transport routes, car ownership can feel mandatory.<\/p>\n But I\u2019m employing every strategy I can think of to avoid ponying up for an extra vehicle.<\/p>\n And with all the app-based doorstep deliveries and on-demand transport options around now, that\u2019s much easier than in the days of the Littlewoods catalogue and the milkman.<\/p>\n Cars are deeply personal. One person will swear by their 17-year-old Nissan, while another will insist it\u2019s irresponsible to drive something without a top Euro NCAP<\/a> safety rating.<\/p>\n So to figure out the cost of car ownership, I\u2019ll have to make some broad assumptions.<\/p>\n This won\u2019t match every Monevator<\/em> reader\u2019s particular needs\u00a0\u2013\u00a0or their adeptness with an oil can and socket set.\u00a0<\/p>\n But we must start somewhere, so let\u2019s start with the key spending categories:<\/p>\n Let\u2019s introduce two hypothetical investors. Both want to own a Volkswagen Polo. But they have very different driving habits and financial tolerances.<\/p>\n So how much financial damage can a modest German hatchback actually inflict?<\/p>\n Alice has a long commute \u2013\u00a010,000 miles a year \u2013\u00a0and she can\u2019t afford to be late for work, so she values the reliability of a new car and a warranty. <\/p>\n She decides to buy a brand-new Polo for \u00a320,000 outright.<\/p>\n Alice\u2019s total commitment to her car is \u00a3121 a week. Every week. <\/em>All for the privilege of driving 10,000 miles a year.<\/p>\n Note that opportunity cost reflects the investment returns you forgo on the money tied up in the car while you own it. Some of that capital can be recovered when you sell.<\/p>\n Gary can get the bus to work if necessary, so he\u2019s less worried about a new car warranty. Hence he buys a three-year-old Polo for \u00a310,000.<\/p>\n Gary mostly uses it for errands and weekend trips, and clocks just 7,000 miles a year.<\/p>\n Gary is paying \u00a372 a week. Vastly cheaper than Alice\u2019s shiny new motor. <\/p>\n We can do better!<\/p>\n Jess the car avoider<\/strong><\/p>\n Jess took a close look at the purchases made by her friends Alice and Gary, and she decided she wants to forgo owning a car entirely.<\/p>\n She also realised she doesn\u2019t want to spend a chunky chunk of her day chugging through traffic jams. Getting a job within walking distance of where she lives solved that problem.<\/p>\n Jess earns \u00a325,000 per year. That gives her \u00a321,521 after tax.<\/p>\n And when Alice points out there\u2019s a vacancy paying a much higher \u00a335,000 at her own workplace, Jess runs through the numbers:<\/p>\nA car costs more than the metal<\/h2>\n
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What\u2019s the price of a Polo, anyway?<\/h3>\n
Alice and the new car premium\u00a0<\/strong><\/h4>\n
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Gary and his sensible secondhander\u00a0<\/h4>\n
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How about skipping the car altogether?<\/h3>\n