Do You Even Need a Car? Owning a Car vs. Uber and Other Alternatives
There used to be two hallmarks that showed a comfortable quality of life: buying a home and purchasing a car. Today, many people are questioning whether they need a car. Maybe the money that would have been spent on a vehicle could be put somewhere with better returns. Perhaps you prefer a more environmentally friendly option or a way to shift the driving risk to someone else.
If you do decide that you need a car, go beyond the marketing and figure out if owning a car is the right option for you or alternatives such as public transportation, ride-sharing, and short term rentals make more financial sense.
Benefits of Owning a Car
- Cars are time-savers, especially compared to the alternatives.
- They are also convenient, giving you freedom, independence, and flexibility. You can go or return when you want. With public buses or trains, you either follow the schedule or get left behind.
- Another advantage of cars over alternatives is safety. You don’t have to share your space with strangers or be driven around by one.
- Car ownership can also provide intrinsic benefits, like a sense of pride and happiness. Some owners may use a car as a form of self-expression, customizing it to reflect who they are.
Disadvantages of Car Ownership
- Purchasing and maintaining a car is expensive. There are several costs which are added onto the monthly car payment (already worth hundreds of dollars). Especially first-time owners can be caught by surprise on all of the expenses that go into owning your own vehicle.
- The car buying and owning process is stressful because you must make many decisions to get the vehicle you want. Then you need to deal with salespeople at the lot and shop for car insurance. You may also have to figure out parking and where to go for service and repair.
- Parking, service and repair, and getting stuck in traffic can also waste time. Think about the traffic on your commute, or how long you spend looking for a parking spot. How much time do you spend waiting for rides while your car is in the shop?
What Car Ownership Alternatives Exist?
You have many options if you decide that you don’t want a car. These alternatives have grown in popularity because they may be more convenient, less stressful, and cheaper than owning a car.
- Walking is an excellent alternative for short distances when the weather is favorable. It is something that almost everyone can do, and it has additional health benefits.
- Public transportation is where you use public transit provided by the government. The fare costs are usually low, as transportation can be subsidized by the government. The price per ride does not depend on how many riders are present.
- Taxis and ridesharing services are similar. Both involve passenger-sized cars that you can hire for travel. Taxis are usually licensed by the government, with a set rate per mile. Ridesharing services, like Uber and Lyft, are privately owned companies who contract private individuals to provide transportation. The costs, while usually low, can also be subjected to surge pricing when there is high demand.
- Car-sharing companies like Zipcar own cars that people rent for short-term use. These cars are placed in convenient public locations where locals may not have cars.
- Car sharing programs allow an owner to rent out their car to other people when it’s not in use.
- Free shuttles may exist between your college campus and the closest major airport.
- Rides from a friend are as simple as requesting a favor.
- Rental cars are good selections for one-off travel or short-term rentals. Costs may vary due to many factors. The driver’s age, driving history, source of rental, and availability of the car can cause the price to fluctuate.
Are the Alternatives Really Cheaper than Owning a Car?
It can be expensive to get to where you’re going, no matter what model of transportation you use. Car ownership alternatives may still be less than the total cost of ownership of a vehicle.
Consider owning a car versus Uber. You can add up the costs of rides over a month and see the immediate impact on your wallet. With a car, you may have to factor in several expenses. This quickly makes the cost of owning a car much higher than we anticipated.
For a quick estimate, you can use the Ride or Drive Calculator. It will show you if it’s more economical to own a car or use Uber/Lyft. The calculator was designed to question the assumption that it’s better to own a vehicle, educating people through comparing tradeoffs.
How to Decide if You Need a Car
The cost of ownership is one thing, but you should also contemplate:
- Your home’s location
- If parking is available, and at what cost
- The distance between your home and your work
- How far away is public transportation from your home and work
- Is public transit frequent enough and convenient for your schedule
- The size of your family
- How each option uses your time, and are they flexible enough to meet your needs.
Example 1: If you live on a farm or other rural area, a passenger truck could be your best option. It may be required for towing farm equipment. Buses in rural locations tend to be infrequent (if they are available), and buildings may be far apart. You may be walking or waiting for a long time if you don’t have a car.
Example 2: Let’s say you live in a large city where parking spaces and insurance are expensive. Large cities tend to have more robust public transportation systems, with frequent buses or trains. They also tend to be serviced by many alternatives like rideshare companies, taxis, and car-sharing companies and programs. You may be able to use public transportation instead of owning a car, especially if you don’t have young children.
Example 3: Perhaps you live in the suburbs and have younger kids that need be driven around to all of their extracurricular activities. In this case, you are better off owning a car as it will be more expensive to use the alternatives.
Owning a car versus public transportation or any other alternative is a crucial decision. The answer can have significant financial and emotional effects, so it’s best to consider all your options carefully. Look at the pros and cons and see how applicable they are to your specific situation. Only then can you know if you truly need a car or not.