Over the past 22 months that I have been working at my job I have commuted to work by car, bus, and bicycle. I have come to love getting to work by bike over the past 4 months and cherish my 22.4 mile, 1.5 – 2 hour commute. However, I have received questions about the relative cost of cycling. Is it really cheaper than other forms of transportation?
I always assumed that it was superior in terms of cost incurred compared to both riding the bus and driving – but I had never really put any effort into crunching the numbers on it.
Well, I have finally put together a spreadsheet that helps me analyze the costs of bike commuting as compared to both driving a car and riding the bus. I made some basic assumptions in this cost analysis that definitely need to be mentioned:
- I valued my free time to my wage at work. This means that one hour spent idle is worth $16.467. This is per Benjamin Franklin’s (and other’s) assertion that time is money.
- Things that I would pay to do are worth the value of my time plus the value per hour of the thing which I pay to do. If I spend $4 to rent a movie I want to watch and the movie lasts 1.5 hours then the value of the movie would be $19.13 per hour ($16.467 + $4/1.5 = $19.13). This is considered value added and will be considered as a credit when I calculate the cost of any single mode of commuting. So, if I were able to watch a 1.5 hour movie for free on every bus ride home – it would count as a credit of $19.13 when I total the cost of commuting by bus. If this isn’t clear now, hopefully it will be in my analysis below.
- All costs are red, all credits are black. This will help visually distinguish between things that cost money and things that I count as adding value to my life.
- The time horizon for the analysis will be 5 years. This will enable the up front purchase price of items like the car and the bike to be distributed over a period of 60 months. I think that this is certainly reasonable.
The Cost of Driving
With these assumption in mind, let us examine the cost of driving to and from work. Here are the basic costs of driving and the costs associated with them:
- Vehicle – $33.33 per month – I imagine that the value of my current vehicle is ~ $2000 (Kelly Blue book agrees) so that is the monthly cost to use my car if it were to last an additional 5 years. With 165,000 miles on it right now, this might be a very generous assumption – but for the sake of this analysis I am going to make this assumption.
- Vehicle Maintenance – $25.33 per month – This includes 4 oil changes a year, $90 for tires a year, and $15o for miscellaneous repairs and fixes a year. I honestly don’t know if this number is accurate or reasonable, but it seems like it is.
- Gas – $35.12 per month – This is from a 25.8 mile daily, round trip commute where I average 30 miles per gallon. It also assumes a gas price of $2 a gallon. This is the value of gas today, but in the past year gas prices have been as high as $4.50 per gallon. I’ll include a table with different driving totals for a variety of gas costs at the bottom of this section.
- Insurance – $87.99 per month – This was the cost to insure me as the 25 year old sole driver of a 1995 Toyota Corolla with Farmer’s auto insurance.
- Time Costs – $336.20 per month – I would spend an average of 20.42 hours a month on the road if I were driving. That is about an hour per working day per month.
Total Monthly Costs: $517.97
Gas Price Affect on the Cost of Commuting
|Gas Price||Monthly Commute Cost|
The Cost of Bus Commuting
With no start up costs, bus commuting probably has the fewest cost categories to deal with. They are:
- Bus Fare – $64 per month – This is the standard fare for a monthly pass on the bus that I would ride if I were commuting by bus. Chances are it will change over the course of 5 years, but I don’t want to deal with inflation in this example so I am not going to do it.
- Time Costs – $1008.60 per month – Commuting by bus would eat up about 3 hours of my day, for an average of about 61.25 hours per month. About 100 minutes of this would be time spent on the bus and about 80 of it spent walking from the closest bus stop to my office.
- Reading Credit – $356.62 per month – While riding the bus I would have about 1 hour of reading time per day. I mostly read free books from the library or material from the internet, so there are no additional costs here. Also, since I value my time reading slightly higher than I value my time working I have put the monetary value on reading at $17.47, a dollar more per hour than my work time.
- Exercise Credit – $346.41 per month – I like to walk and it is decent exercise for my body. I do spend time walking on my own as a way to relax both my body and my mind from a day of work. It gives me time to think, which I do value. This activity has a value of $16.97 (my base time value plus $0.50).
Total Monthly Costs: $369.50
The Cost of Bike Commuting
Bike commuting is my current mode of transportation to and from work. Its costs are as follows:
- Bike – $2.67 per month – My current ride cost me $160 cash money from a nice deaf man in La Jolla. It is old (probably from the 70s or 80s), but it rides well enough to make me think it will last for 5 more years – easy.
- Bike Maintenance – $20 per month – I really haven’t spent this much so far on maintenance, but I don’t really know the costs that I could incur in the future because I haven’t learned to properly maintain my bike. I think $1200 over the course of 5 years will definitely be more than enough to cover any of fixes that might crop up, seeing as how it is 7.5 times the cost of my bike.
- Cycling Apparel – $5 per month – I haven’t bought anything in terms of cycling apparel, but I do keep thinking about buying shoes for my clipless pedals – I just can’t seem to get up the gusto to check them out and fork over the dough.
- Time Costs – $558.09 per month - This assumes 1 hour and 40 minutes in the saddle each day, or two 50 minute one way trips. That comes out to about 33.9 hours a month, on average. It also means that I travel about 13.4 miles per hour on my rides home – which isn’t very fast.
- Exercise Credit – $591.99 per month – The exercise value of cycling is very high. It is great cardiovascular activity, promotes flexibility (even though I am terribly inflexible), and strengthens the core. For the sake of this analysis I have valued my time cycling at $17.47 an hour.
Total Monthly Costs: $6.23
Cost Analysis Conclusions
It appears that commuting by car is the most expensive at $517.97 per month, bus commuting is next at $369.50 per month, and bike commuting is the least expensive (and actually “pays” me) at $6.23. Now I know that not everyone will value their time the same exact way that I did or count exercise and reading as credits, so I have included a table of the cost as I demonstrated above, without including time and credits, and without considering the credits I gave biking or bus riding.
|Everything Included||Without Time and Credits||Without Credits|
|Bike Commuting||$ 6.23||$27.67||$585.76|
In the end analysis, bike commuting appears to be the most cost effective mode of transportation given my assumptions and predicted costs. I have certainly left things out, like the difference in lifetime health care costs, but I think that this is a fair and accurate analysis.
Update: Thanks to all the individuals who left useful and insightful comments. I have appreciated them and they have helped me think about this topic with more clarity than I was previously able. I also wanted to thank Free Money Finance for hosting the Carnival of Personal Finance and including me as an editor’s pick. Apparently I did something useful with an article about commuting costs.