Author Topic: Challenges if we ditch 2nd car? Teen learning to drive, comparing Zipcar, etc.  (Read 5323 times)

miniwrite

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Our 22-year-old Honda Accord just died, and my husband and I are considering not replacing it--at least for a while. We have another vehicle ('07 Ford Escape) that he uses to commute to work and our family can use on weekends. So we'd become a one-car family.

Can you guys suggest a few solutions to the challenges I'm seeing?

- What's the best way to compare the costs of potentially buying another cheap BACKUP car against cobbling together solutions like renting a Zipcar, taking public transportation, Uber, etc. Should I try to anticipate like 6 months(or more?) worth of use for the backup car and compare the two solutions and their cost?

Solution 1 is: Buy cheap car (purchase cost, insurance, gas, oil changes, etc.) vs. Solution 2 is: Make do (Uber charges, Zipcar charges, buss pass).

I work from home so don't drive much. Sometimes to run errands or pick up/drop off younger daughter from school. But she can take the bus home and get a ride in the a.m. from neighbors. This is why I'd like to experiment without a 2nd car if possible.

- Second, bigger(?) "challenge": We have a 17-y-o daughter who really needs to learn to drive this summer. How to do that with no backup car? She'll be home from college in the summer. Husband has the Ford Escape all day. No reasonable way to drop him at work and take back the car (it would be a 1.5 hr round trip twice daily!) Public transportation is not great toward his work area and would change his commute from 45 min x twice daily to over 2 hours x twice daily. No coworkers can carpool (he's tried).

Suggestions? Things that have worked for you?

Dee18

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17 y.o. gets summer job near dad?  Rides to and from work with him?

ooeei

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I vote have the 17 year old work over the summer to buy a car (or pay for one you buy). 

KCM5

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Is there a reason the 17 year old can't learn to drive evenings/weekends when the car would be available?

miniwrite

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OMG-- Duh! Yes, the teenager could learn on weekend and in the evenings since it will be light out at night during the summer! I didn't even think of that.

Teenager can't work near dad. She already has a good job that's walking/bussing distance from home.

How about how to compare the costs of buying a cheap car vs. Uber, bus, etc. Just a simple comparison list? Over what time period? If I look at one year, for instance, the car will obviously be the most expensive by far because of the purchase price not being amortized for long

RyanAtTanagra

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- What's the best way to compare the costs of potentially buying another cheap BACKUP car against cobbling together solutions like renting a Zipcar, taking public transportation, Uber, etc. Should I try to anticipate like 6 months(or more?) worth of use for the backup car and compare the two solutions and their cost?

It's hard to compare costs ahead of time.  I don't own a car and just use zipcar for quick trips and normal rentals for full days or more.  Sometimes I'm using them a lot, other times I'll go 6 months with zero use.  You can't use your current car usage as a gauge for how much you'll use a rental car, because you'll come up with alternative solutions part of the time.

Zipcar is what, $60/yr?  I say just get it and see how long you can last without having a second car.  If you start spending so much on rentals it'd be cheaper to buy, or at least the convenience of having a second car would we worth the cost difference, then at worst it's a cheap experiment and you'll know you're making a truly informed decision.

bridget

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How about how to compare the costs of buying a cheap car vs. Uber, bus, etc. Just a simple comparison list? Over what time period? If I look at one year, for instance, the car will obviously be the most expensive by far because of the purchase price not being amortized for long

I'd pick a per-month time period; I don't see any reason to pick something arbitrary like "six months."

Estimation of Car:

- Purchase price. Assuming you are buying it with cash, amortize the purchase price over the expected life span of the car. If you buy a $10,000 car and expect it to last 10 years, that's about $83/month. If financing, use the monthly payment.
- Insurance. Mine costs about $45/mo for one car.
- Mileage. I know people have all sorts of opinions, but I like to use the IRS mileage estimate for gas + wear and tear for the sake of simplicity. If you generally put 100 miles on your second car per month, multiply that by $0.54, for about $54 in gas and wear and tear monthly.

Estimation of "Make Do": This is trickier, because you have to run a few comparisons based on what you are actually likely to use or need. I don't think you need a zipcar membership and a bus pass and ubers; that seems like overkill. I would probably use the bus/walking/bike as my base "getting around" option, and pick either ubers or zipcar as my backup method of transportation. Uber has the benefit of not having a base monthly fee to use, zipcar has the benefit of being easier if you need to run lengthy errands, or haul people or stuff.

Try to write down every trip you remember taking in the second car the last week you used it, and extrapolate it to try to estimate the trips you take in a typical month. What happens with those drives? Does your younger daughter need a booster seat? Do you take shopping trips where you haul back a lot of groceries/go to Home Depot to pick up bulky items? Could you adjust your schedule so you do those big trips on weekends or evenings? Do bus routes take you to your most common locations? Would you go on enough bus trips to justify a monthly pass (instead of paying a couple of dollars for individual rides - in my city, bus passes are pricey enough that they aren't worth it unless you're taking the bus nearly every weekday)? You need these details to figure out a good estimate.

In my personal situation, I can walk for groceries, bike to work, bus many close places, and unusual places it's easiest to get an uber. I'd estimate 10 bus trips a month at $1.50 each for $15, and liberally estimate 4 uber rides at $25 each, for $100. So, I'd guess $115/mo. Let's say your car fits the parameters I've outlined above ($83/mo purchase price, $45/mo insurance, $54/mo mileage, for a total of $182/mo) - it'd be financially worth it for me to ditch the car.

miniwrite

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Well, lookie, lookie! Someone has already created a comparison tool!
http://bostinno.streetwise.co/2015/12/31/car-ownership-calculator-compare-to-uber-zipcar-costs/

I haven't tried it yet, but looks promising.

I actually had a coupon (Chinook Book in Oregon) toward a year Zipcar membership and the initiation cost. So I paid $35 and they also gave me a voucher for $35 of free driving! Basically free to start.

miniwrite

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Thanks, Bridget! Great analysis. Just what I was looking for.

darkadams00

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- Second, bigger(?) "challenge": We have a 17-y-o daughter who really needs to learn to drive this summer. How to do that with no backup car? She'll be home from college in the summer.

Teenager can't work near dad. She already has a good job that's walking/bussing distance from home.

So why does the 17 year old need to learn to drive now? She's away at college or working near home. My older son didn't learn to drive until he was 19. No need to since he had alternative means of transportation to all of his regular destinations like school and work. My younger son will be 20 this year. Probably won't get his license until he finishes college--he's banking all of his money. We made it clear--we'll help with college, but driving costs such as a car, insurance, fees, gas, maintenance, etc. are their responsibility. And we don't buy an extra car just because they "need" one. If they're old enough to need one, they're old enough to handle the costs.


CindyBS

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We are pretty much a 1 car family and went from 2 cars to 1 in 2012.  We have 1 car 8 months per year and "babysit" my dad's car in the winter while my parents are snowbirds in a warmer locale.

Here's how we calculated the costs - we did a cost to own on Edmunds for the year/make/model of desired car.  I knew approximately what type of car we would buy if we replaced our car that we decided to get rid of, but you could just scan Craigslist and come up with some real life cars that you would consider buying.  I did need to tweek the number Edmunds provided in regards to insurance and something else.

By far, the biggest expense on the cars we looked at was depreciation - they were all 3-5 years old.  This may not be an issue with a super old car like you are considering, but it is probably the most frequently overlooked costs when people think about car costs.

It is kind of hard to know how much transportation costs you will have without really doing it.  I thought I would use the bus all the time, but I rarely do.  I typically just schedule things when we have a car.  We have a lot of transportation options where we live - walk, bike, bus, Uber/Lyft, taxis, or car. 

We typically walk or bike when we don't have a car.  We do not have car sharing.  Honestly, a lot of making it work is a scheduling thing more than anything else.  Your 17 year old can learn to drive in the evenings and in summer.  The biggest thing is getting out of the midset of "I can driver anywhere, anytime" to a car sharing model with other adults.  Things you do during the day you may have to do in the evening. 

I also make it a point to offer to carpool places with people when I have a car, knowing that sometimes I may ask them to drive me when I am car-less.  I have a couple friends lined up at each of my kids' school that can drive my kid home "just in case".  I have yet to ask them this year.   We are fortunate that we live in a very walkable, bike-able place and being able to bike around town on your own is practically a right of passage for kids here.   

During the first 6 months I tallied every non-car transportation expense, but once it was so clearly saving us a ton of money (estimated to save about 5K per year), I stopped.  Good Luck!

CanuckExpat

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- Second, bigger(?) "challenge": We have a 17-y-o daughter who really needs to learn to drive this summer. How to do that with no backup car? She'll be home from college in the summer. Husband has the Ford Escape all day. No reasonable way to drop him at work and take back the car (it would be a 1.5 hr round trip twice daily!) Public transportation is not great toward his work area and would change his commute from 45 min x twice daily to over 2 hours x twice daily. No coworkers can carpool (he's tried).

17 year old learns to drive in a class or with a driving instructor. Driving instructor provides car, lessons much cheaper than second car right?
Bonus is that in some jurisdictions insurance for a teenage is much cheaper if they have taken lessons.

miniwrite

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DarkAdams & CanuckExpat-- The kid already took driver's ed but she needs a LOT more practice. The main reason for her to drive is for non-work activities or at night when we'd rather she not be on the bus. But your points, DarkAdams, are really good--things we often don't consider when we're used to having cars available 24/7. My own parents would NEVER have bought another car just because a teenage me "might" need it. No way.

CindyBS, thanks for weighing in! This is exactly the kind of "been there, done that" info I need. I see what you mean about the reality being that you simply schedule stuff for when you have the car. I think that's probably what we would do, too.

It may sound silly, but my sticking point now is not being able to drive my younger child to school in the mornings. We are hoping to rely on a neighbor through the end of June--just for the morning rides. That feels uncomfortable. I'll offer them gas money or give them Starbucks cards if they won't accept. But sometimes they are unreliable, and I don't know--it's just odd relying on a neighbor EVERY morning.

You said: "I also make it a point to offer to carpool places with people when I have a car, knowing that sometimes I may ask them to drive me when I am car-less.  I have a couple friends lined up at each of my kids' school that can drive my kid home "just in case".  I have yet to ask them this year.

I like that idea. I'll happily do that with other parents. Unfortunately, the neighbor family just doesn't go to the same places as we do on the weekend so it's hard to offer rides.

This may be one of those things that I just need to get used to. And maybe it will be less of an issue than I think.

KCM5

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Not being able to get your younger child to school in the mornings is not silly. It's a necessary place for the child to go.

Are there no other ways for the child to get to school other than driving by you or your neighbors? Bike? Bus? Ride from husband on his way to work?

I can understand why you wouldn't want to rely on your neighbor every day for that sort of thing unless they were very reliable and compensated - be that in favors by you, money, coffee, etc.

miniwrite

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The younger daughter could bus to school in a pinch. Too far to walk/bike, and husband leaves too early to drive her to school.

For what it's worth, I used Bridget's ideas to compare my "buy a 2nd car" vs. "Make do."

"Make do" wins in my hypotheticals. Wanna see?

REPLACEMENT CAR COSTS

Example: 2003 Honda Civic Hybrid, $6,000, keep for 7 years max
* This is an older car (12 years old already). More savings for more $$ car

Purchase/ 7 years:         
$857 year =                                           71/ mo

Miles driven/mo. 513 x .17            87/ mo   
(AAA rate for gas, tires, maint, repairs. Per mile)
Based our actual mileage

Insurance estimate                43/mo

Registration (145/ yr)               12/mo

Depreciation   (785/yr)            65/ mo   
Loosely based on Edmunds.com

TOTAL COST:               $278/ mo = $3,336/ year   


“Make Do”: UBER, Zip Car, Bus

Monthly Mtg Zip $12 x 4         48

Dentist 3x year Zip
= 36/yr =                  3/ mo

1 x school Zip (1 hr)            8

Daughter 2 more bus passes/wk
8 x 1.25                  10

A.M. bus money neighbors         20

Uber emergency               20?

Misc. Errands Zip 4 hrs         31

TOTAL                  $140/ mo = $1680/ year

Estimated Savings = $1,656/yr or $138/mo
« Last Edit: February 19, 2016, 10:50:31 AM by miniwrite »

bridget

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Looks great! The only tweaks I can think of:

1) I think amortizing the purchase price over the life of the car AND depreciation is double-counting. The amortization approach basically says "I have $6k worth of car. In 7 years I will have run it out of life and I will have $0 worth of car." It assumes that it will depreciate into nothing. I think you use price per month OR depreciation, but not both. I'm not totally sure about this - what do others think?

2) is there a monthly or yearly fee to having a zip car membership in your area? Are you accounting for that in your zip car estimates?

bridget

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Nevermind, didn't read carefully enough! Sounds like you got a deal to eliminate the zipcar fee, at least for the first year. I'd look at what it looks like with the fee to know how it'll be after that introductory deal is over, but it doesn't seem like it'll affect your numbers too much.

CanuckExpat

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If it helps, nice article from Brave New Life: How To Be a One Car Family

CindyBS

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DarkAdams & CanuckExpat-- The kid already took driver's ed but she needs a LOT more practice. The main reason for her to drive is for non-work activities or at night when we'd rather she not be on the bus. But your points, DarkAdams, are really good--things we often don't consider when we're used to having cars available 24/7. My own parents would NEVER have bought another car just because a teenage me "might" need it. No way.

CindyBS, thanks for weighing in! This is exactly the kind of "been there, done that" info I need. I see what you mean about the reality being that you simply schedule stuff for when you have the car. I think that's probably what we would do, too.

It may sound silly, but my sticking point now is not being able to drive my younger child to school in the mornings. We are hoping to rely on a neighbor through the end of June--just for the morning rides. That feels uncomfortable. I'll offer them gas money or give them Starbucks cards if they won't accept. But sometimes they are unreliable, and I don't know--it's just odd relying on a neighbor EVERY morning.

You said: "I also make it a point to offer to carpool places with people when I have a car, knowing that sometimes I may ask them to drive me when I am car-less.  I have a couple friends lined up at each of my kids' school that can drive my kid home "just in case".  I have yet to ask them this year.

I like that idea. I'll happily do that with other parents. Unfortunately, the neighbor family just doesn't go to the same places as we do on the weekend so it's hard to offer rides.

This may be one of those things that I just need to get used to. And maybe it will be less of an issue than I think.

FWIW, it sounds like my family has a couple things that makes it easier for us  1) My kids live within walking distance of their schools 2) My husband can work from home pretty much when he wants 3) We live in the Midwest and have my dad's car in the winter 4) I work 1.5 miles away from home and can bike or take the bus.  Next year we are moving building and my work will be a 10 min. walk away

This winter has not been bad, but the past 2 were horrible.  I would not have done the 1 car thing during those past years.  They held school 1 day this year when the windchill was -8 degrees and my oldest has a 25 min walk to school.  I drove him in my dad's car - I will not make them walk in that.  (especially since he has sensory issues)

You can try it and see how it goes , but I think you have some real concerns about your younger child.  The 2 people I carpool with are basically totally supportive of the 1 car lifestyle but just can't make it work themselves, but I know a lot of people who would just consider the whole thing weird and would consider it like mooching to ask them for a ride . . . .  Unfortunately, it is very hard to be car less with kids in the vast majority of the US. 

miniwrite

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Looks great! The only tweaks I can think of:

1) I think amortizing the purchase price over the life of the car AND depreciation is double-counting. The amortization approach basically says "I have $6k worth of car. In 7 years I will have run it out of life and I will have $0 worth of car." It assumes that it will depreciate into nothing. I think you use price per month OR depreciation, but not both. I'm not totally sure about this - what do others think?

Ahh, you're probably right on that. Delete depreciation. :-( 

In future years, Zipcar would cost $70/year, so I would have to add that in.

With those tweaks, I'd save only $73/ mo or $876/ year using the Zip/Uber method. I mean, it IS a savings, but is it worth it to add the hassle of booking rides in advance and not having a car for emergencies?

After year 1, adding the Zip membership back in, I'd save $67/ mo. or $804/ year.

Now I'm having second thoughts. Maybe a cheap 2nd car isn't such a horrible deal after all, considering that we don't use it a ton.
« Last Edit: February 19, 2016, 02:21:22 PM by miniwrite »

miniwrite

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Wait, are we sure about skipping depreciation?

I have to amortize the cost of the car because it's a true expense. I pay it upfront.

AND if I were to sell the car in year 2 or 3, it WOULD still have some resale value. However, the longer I keep it, the more value I lose, so that's a real expense too, isn't it?

bridget

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Wait, are we sure about skipping depreciation?

I have to amortize the cost of the car because it's a true expense. I pay it upfront.

AND if I were to sell the car in year 2 or 3, it WOULD still have some resale value. However, the longer I keep it, the more value I lose, so that's a real expense too, isn't it?

The depreciation is baked into amortization, no? Amortization assumes you will never sell it, or that by the time you want to sell it - in 7 years - it has depreciated to zero (and you "realize" that loss when you are unable to sell it). Totally willing to be proven wrong on this, but intuitively it seems like you don't have an added expense of depreciation every month in addition to what you paid for it.

miniwrite

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Yeah, I think you're right, Bridget. Thanks for explaining!

bridget

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With those tweaks, I'd save only $73/ mo or $876/ year using the Zip/Uber method. I mean, it IS a savings, but is it worth it to add the hassle of booking rides in advance and not having a car for emergencies?


I feel you here. It's pretty much why I still have a car, even though I technically don't *need* one. My car is paid off, I don't drive it much so I don't pay much in gas/maintenance, and I no longer live somewhere where I need to pay to park it. With insurance and registration and stuff it's more than $100/month, but it's only a bit more than ubers/the bus would be. (Like, $40 difference or so). There are SEVERAL way easier ways I can save $40/month, that don't create an ongoing logistical hurdle in my life. If I cut down on happy hours after work by half (or just didn't order that second beer), I'd save $40 a month. I figure I should actually do that before I cut the car. Low hanging fruit, and all.

miniwrite

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EXACTly, Bridget. Thx!