Hello fellow Junior Mustachians and Senior Mustachians that I try to emulate! This is my first post and I'm looking for some insight on a recent (hopefully good) investment. I'm an engineering college student that lives 12 miles from campus, and I alternate semesters between full time schooling, and full time work at a company I landed an engineering internship at, however this company is 45 miles away from home!! So I recently purchased a Kawasaki Ninja 250cc motorcycle to save money on gas during my daily commute to work/school. This motorcycle gets 61 MPG, as opposed to my previous commuting car, a 1999 Pontiac Firebird V6 that gets 26 MPG on average. I could have gotten a scooter that gets more miles per gallon, but its highway to school and work, so that kills the scooter idea. Also, I can't move closer to school or work because I'm currently living for FREE with my parents until I graduate. The motorcycle cost me $3250 total after title, registration, plates ect. And I currently have student loans at 6.8% that I could have invested this money in, saving me $231 a year in interest. But this is where the costs end.
Insurance for the bike is $222 a year, however getting the bike gave me the balls to take my car off full coverage and replace it with liability insurance reducing it's premium by $372 a year, equating to a savings on insurance of $150. I figure I'll be driving the car much less now (cold/rainy days only), so my actual risk of causing an accident is much less. I didn't have to buy a helmet or safety jacket since my brother had his left over from his old motorcycle he sold before moving out, and he gave them to me. What a nice guy!
While I'm working, each day I drive 90 miles round trip, and I figure I'll be able to ride the motorcycle to work 3 out of 5 days of the workweek (it might rain forcing me to drive the car), saving me on average $24 a week in gas. While I'm in school each day I'll drive 24 miles round trip to school, once again riding the motorcycle 3 out of 5 days due to rain, saving me on average $6.40 a week in gas. I'm in school for 4 months out of the year, and I work for the remaining 8 months, so the combined yearly gas savings are $943 per year. Also, motorcycles are much cheaper to maintain than cars are (two small tires instead of 4 large ones, they use MUCH less oil, no transmission/differential fluid to change, smaller brakes, the list goes on) but these are very hard to quantify so its more of an afterthought.
Summary
Yearly Costs:
Registration/Plates - $27
Insurance - $222
Student Loan interest - $231
Yearly Savings (estimated):
Gas - $943
Insurance (car now on liability) - $372
Maintenance - Unquantifiable
Total Yearly Savings = 1315-480=$835
So what do you guys think?? Good investment or bad investment? Are there any flaws with my math/assumptions? And lets please leave this to a purely financial discussion and not get into the safety of motorcycle riding. That discussion is for the Complainypants that's afraid to save some money!