A set of car keys.

Can You Live Without A Car

For many Americans, the automobile is the ultimate symbol of freedom and they could not dream of living without it. If you could though, you could save a lot of money. Our cars and trucks cost us thousands and thousands of dollars each year. Money that might be better off invested. But can you really live without an automobile and if so, how much will you save.

Giving Up Your Ride

This might sound extreme for some but giving up your vehicle might just be the best thing that you ever do for your budget and your retirement account.

Let’s add up all of those vehicle expenses and see what that vehicle is really costing you. After we do that, we’ll look at some alternatives that you can consider.

Vehicle Expenses

Your car or truck might be costing you more than you think. Take a quick look and let’s do the math.

Car Payment

The average car payment in the United States on a new car is just over 500 dollars at $530 according to nerdwallet.com. That is 6000 dollars a year.

If you were to take that money and put it into a moderate growth investment account, you would have over 200,000 dollars in 20 years. That is at a modest growth of 5 percent a year, you could end up with more on a more aggressive account.

Auto Insurance

This is an expense with a huge variety of rates. The rate that you pay for auto insurance could range anywhere from 100 dollars to over 300 dollars a month. That translates into 1200 dollars to over 3600 dollars in a year.

Once again, taking this money and putting it into an investment account would have a huge impact on your retirement fund. After 20 years, you could have 40,000 dollars to well over 120,000 dollars hidden away.


This is also a variable expense which depends on the cost of fuel in your area, the mileage of the vehicle and how much you drive. Let’s do the average of everything. The average American drives about 13,000 miles according to the DOT. The average vehicle gets about 24 MPG and the average cost of fuel is $2.50.

This means that the average driver will use 541 gallons of fuel which will cost them $1352. That is 46,000 in 20 years in the same investment account.


Assuming that you vehicle does not need major repairs, maintenance costs should be minor. That being said, they still add up.

Based on the average mileage, you will need 4 oil changes a year at a cost of $50 a piece. You will also need an annual air filter change at a cost of around $30. That is $230 a year in total just for basic maintenance.

As a vehicle ages, it may require other maintenance procedures such as transmission fluid changes, belt changes, new spark plugs, tires , etc. A simple transmission fluid change can easily top 300 dollars alone and a new set of tire s can go for over 800 dollars in many cases. You can see where these costs could add up.

Adding It All Up

Now, let’s add up al of the basic costs. Auto payments, insurance, fuel and basic maintenance. This could range from 8,782 dollars to 11,182 dollars a year.

Investing that money would yield anywhere from 300,000 dollars to over 380,000 dollars in just 20 years. That represents a huge portion of your retirement fund and could potentially be much higher with a more aggressive retirement fund.

Vehicle Alternatives

It is easy to see where you can save big by ditching that automobile, but you still have to get around. Here are some alternatives that you can consider.


This is likely only an alternative for those in large metro areas, but it might be a viable choice for those in larger suburbs.

Walking is free and has another benefit, it is good for you. You will probably find that you not only save money by switching to walking, you also might just lose a few pounds and add years to your life.

The only downside is that it makes grocery day a bit more challenging but that can be solved. You can either shop in smaller quantities and more often or you can turn to an inexpensive delivery service. The slight cost for turning to deliveries will be greatly offset by your vehicle savings.

Public Transportation

A vast majority of the country is served by some form of public transportation. The cost of it, is a small portion of what you would pay to own your own vehicle.

While owning a vehicle would cost you around 800 dollars a month on average, public transportation is around 100 dollars a month nationally. That is for the average monthly pass, it could be less if you ride less frequently.

There are also a lot of  side benefits to using public transportation. It is better for the environment, it is generally safer and it gives you time to do other things. You do not have to worry about driving, so you can read, play on your phone or do whatever you like.

Ride Sharing

If you only need access to a vehicle or individual transportation from time to time, a ride sharing service like Uber or Lyft could be just the thing. You can use one of these services for the occasional times when public transportation does not work for you or that you can not walk.

The beauty of a ride sharing service is that you get access to a vehicle without paying all of the high expenses that come with car ownership. You save money and others who desperately need money can earn it with their cars.

Posted by
James Car

James Car is a finance, loan and budget expert based in the United States. After attending Brookhaven college, he went on to become a successful entrepreneur. He now enjoys writing articles that help people save and make the most of their money.