Published on March 14, 2016 12:28 pm, by Jen Bakker
We are a family of 2 adults and 3 children and we operate on one car. We have friends who tell us that the convenience of having a 2nd car outweighs the cost.
Every time we float the idea we take the time to do some figures.
Annual cost of purchasing a car => anywhere from $2,000 to $200,000. If we’re looking for something just for convenience and as a back up to the family car I’m going to pick a figure of $5,000.
Conservatively speaking a car that costs $5,000 will have a life of 10 years. Total annual cost = $500
Annual cost of running a car => this is based on Sydney prices, and I went with averages after a bit of research (googling).
Comprehensive insurance $800
Service + tyres + miscellaneous $600
Pink slip $38
Total Annual cost = $2,388
Total annual cost of owning and running a 2nd car
Between the purchasing and running costs, excluding petrol, parking and tolls, we would spend approx. $2,888 per year.
The cost of Uber
Each family’s circumstances are different. For us we need to calculate the times we would go our separate ways, generally on the weekends for sporting events or to get in to the city for an event or social occasion.
It makes sense that the person travelling the least distance (or drinking) would be the one to take Uber and the other the car.
CALCULATE home to the city, which is the furthest we would travel individually to socialise, and the cost of that on a bad day is $35. Given we would be unlikely to do this more than once a month, total cost for the year = $420.
CALCULATE the cost to get to the closer of 2 sporting fields, and that would be maximum $20. Given there are 40 weeks of sport for us each year, total cost = $800.
Total annual cost of Uber
For our circumstances the total cost of Uber would be $1,220 for the year.
This reinforces again our decision to run one car. It’s worth noting that in the last year there have only been 2 or 3 occasions where we have had to use Uber.
Mostly it’s easy to walk, or catch a bus, and the costs there are significantly cheaper than Uber. In our circumstances the convenience factor doesn’t come at all near to offsetting the true annual cost of purchasing a 2nd car.
Jen is an experienced banking professional who loves wine, coffee, finding a bargain and of course her three beautiful children. Since Jen's first budget led her to buy a home at 20, Jen has passionately helped others to make better decisions with their money.