Money Matters

Cars, do you really need them?

If you’re lucky enough to live near a train station, tram or bus stop, chances are you use public transport, either to get to work or school or just to avoid the hassle of driving and parking in the CBD. According to the VISTA 2007-2008 summary of survey results, however, only 7.7% of trips made in Melbourne were on public transport, whereas a whopping 77.1% of trips were in cars.

Cars are often the more reliable and convenient form of transportation. Some places just aren’t easily accessible via tram, train, or bus, and some jobs (like Cheap Geek’s new position) require cars. But if you live in inner-urban Melbourne where there are half a dozen public transport options on your doorstep, do you really need a car? Or is it just an oversized, CO2-emmiting, fuel-and-money-guzzling safety blanket?

That’s right. Money guzzling. Your safety blanket is the AntiThrift. It requires registration, insurance cover, and maintenance. At the time of this post, annual VicRoads registration for a standard light motor vehicle garaged in Melbourne costs $696.50. Insurance requires another $965.96*. A minor service is somewhere upwards of $185 per year**. And a major service, like today’s 80000km service on my bunged-up Corolla, will you rob you of your hard-earned $900. That’s a couple of grand, and we haven’t even factored in the costs of fuel, financing, and depreciation.

If you want the specifics, RACV has a car owning and operating costs guide which breaks down ‘the cost of financing the vehicle, depreciation, scheduled services, registration, insurance, fuel, tyres, etc. The calculations are provided as a guide to the car operating costs of a vehicle over a five year, 75,000 km (15,000 km per year) period.’ Otherwise, stick to the weekly and annual costs of some examples I’ve lifted from guide:

Compare this to just using public transport. A 365-day Zone-1 full-fare Myki pass costs $1306.50, whilst a 365-day Zone-1-and-2 full-fare costs $2021.50. Even with the occasional taxi fare and car hire, you shouldn’t be spending more than $3000 per year, which is still significantly less than the owning and operation costs of a Suzuki Alto GL, the cheapest new car to run as per the RACV.

So if you’re already at first or second base with public transport, you might as well go all the way. Dump that safety blanket of a car. It should save you money, even after the counselling fees.

*This is an average for mid-2011, taken from ‘Melbourne drivers the winners: RateCity’s Bi-annual Comprehensive Car Insurance Comparison’.

**It costs $185/12 months to service a new Holden Barina at a Holden dealership.

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