In the next couple months, my personal situation will change leaving me with an important decision to make vis-a-vis my vehicle and modes of transportation.
My current situation: living in the suburbs, driving to work
- Monthly insurance premium: $150
- Access to public transit: No
- Commute to work: 40 km one way
- Parking costs: nil
My expected situation in a couple months: living down town
- Monthly insurance premium: approx. $400
- Access to public transit: Yes
- Commute to work: 8 km one way
- Parking costs: $200/month at residence
The way I see it, I have three options:
Keep my car and continue driving to work: my insurance premium is significantly higher because I am living in a more congested down town area. I now also have to pay to park in the building. My costs of operating a vehicle are really high but I have a high level of mobility to go anywhere there isn't public transit.
Keep my car in storage, use public transit: keeping my car in storage allows me to reduce insurance coverage to just theft/fire. I will still be paying for parking/storage costs. However, I get to own a car and if my circumstances change again, I can change my coverage to reflect this. It also saves me the hassle of having to sell the car, and buy another one in the future.
Sell my car, use public transit, rent a car when needed: it will be nice to not have to pay for fuel, maintenance, parking and insurance. Using public transit costs a fraction of owning a car. On the other hand, I might need a car in the future and there is the overhead of having to search for a car with a good record, pay sales tax, etc. The way insurance is calculated, I lose points for not being continually insured during the time I didn't have a car.
- Approx. blue book value of car: $6,000
- Approx. mileage on the car: 110,000 km
- Reason for significant increase in insurance: I am moving from the suburbs of a small city to the down town core of a large city. I recently got a speeding ticket. I am a single, 24 year old male.
- Car utilization: apart from my commute to work, I expect to walk everywhere while living in down town, especially during the week. I could see myself using the car maybe every other weekend to visit friends who live in the suburbs- however, this kind of use is infrequent and I could see the merit in renting a car for the day and using it for all my errands that need me to have a car.
Which of the three options is most cost effective and why? Are there any factors apart from convenience, time, and money I have overlooked?