Is Uber Cheaper Than A Car Payment?

August 24, 2015

My colleague Doug Spencer asked himself that question when his oldest daughter began to drive and so far for him, the answer is “yes!” Like many families, they have two busy kids going in different directions for school, activities and work and with a third driver, a third car seemed like the answer. For many people it probably is, but here are the reasons that Doug has decided to hold off on purchasing another car:

  1. Doug likes to drive the wheels off of his car. His car already has 170,000 miles and he wants to go to at least 250,000. The value of his car with the miles and various wear and tear isn’t too high so even if it gets a door ding in the school parking lot – which it already has – it doesn’t really impact the value of the car.
  1. Doug, like the rest of our team, travels a lot for work. He can drive his car 30 miles each way to the airport and pay $8 per day for the car to sit unused while his family is left high and dry or he can take Uber to the airport for just over the cost of the parking and gas.
  1. When he’s not traveling, Doug works from home and doesn’t have to do a lot of driving during the day while his wife is at work. Sometimes he does and his daughter has to suffer the “trauma” of getting dropped off and picked up again, but usually Doug ends up taking Uber about twice a week for a short errand.

Since they started this arrangement in the spring, Doug has spent about $80-$100 per month on Uber for those local errands, etc. To get insurance alone for his daughter could run $300 per month so Doug figures that he’s saving about $200 per month with this car sharing/ride sharing combination. This frees up money to save so that when his daughter is ready to leave the house and needs her own car, there will be more money for the cost of the car, the operating expenses and eventually replacing Doug’s car when he hits that 250,000 mile limit.

The bottom line is that our lives and economy are rapidly changing due to technology. Whether it’s transportation, entertainment or housing, we have a lot more options today to get something that fits our needs most of the time for a lot less money. Sure it’s not a perfect system, but so far Doug’s been able to trade an occasional delay and forgoing that new car smell for old car savings!