The trip to work is a true journey for some 3.4 million commuters that travel at least 90 minutes each way to and from their jobs on a daily basis. Pundits call it "extreme commuting" and, according to the U.S. Census Bureau's 2004 report Journey To Work, trips of 90 minutes or more are the fastest growing category of commute since 1990. Why do people go to such extremes? Primarily, it's for the money! Read on to find out the financial pros and cons of living farther away from where you work.

Big City Salary, Small Town Living
There are two major issues driving the growing trend of extreme commuting. By far, the leading issue is money. The real estate boom that has taken place in the United States in recent years has seen housing prices soar. Today, particularly in the immediate suburbs of major metropolitan centers such as Los Angeles and New York, many people simply can't afford to live near where they work.

This reality is forcing an increasing number of people to move to what is being called the "exurbs," which are basically the suburbs of the suburbs. As a result, the national average commute time has increased and the number of extreme commuters has nearly doubled since 1990. In 2000, the average daily commute was 25.5 minutes - extreme commuters came in well above that average, driving in excess of 90 minutes to arrive at work each day. This may seem like a long time to spend on the road, but the tradeoff for extreme commuters comes in the cost of their housing. In fact, it is not uncommon to see price differences of more than 50% between housing near major metropolitan centers and that in the exurbs. This is a huge factor if you consider that housing is the largest single expense for most households and, according to the National Association of Home Builders, the prices for new homes have nearly tripled over the past two decades. Extreme commuters also benefit from other cost breaks. Car insurance, for example, tends to be lower due to the lower traffic volumes and less frequent accidents in the exurbs. Tax rates may also be lower, as outlying areas aren't required to support the aging infrastructure and social services programs required in the city. (For related reading, see Shopping For Car Insurance.)

Along with the lower cost of living, the exurbs also offer what some people see as a better quality of life. Large homes with large lawns, low crime rates, no poverty or traffic-clogged roadways and fewer people are all part of the appeal of life in the exurbs. In general, living farther away from core metropolitan areas is believed to provide the safe and unhurried lifestyle that is usually associated with small-town life.

The Other Side of the Coin
Although extreme commuting can provide financial and quality of life benefits, the more time that is spent commuting to and from work, the less time commuters have to spend at home with their families. While the average commuter spends more than 100 hours per year on the highway, according to the U.S. Census Bureau, an extreme commuter can rack up those hours in just a little over two months. Additional detractors include the relative lack of cultural institutions and shopping opportunities that exurbs provide compared to their metropolitan counterparts.

While most people escape to the exurbs for financial reasons, many of them fall into a trap when it comes to housing. Instead of buying a modest, affordable home, they instead cave in to the temptation to buy a big house and stretch their budgets in order to do so. Once this choice has been made, these people are locked into the extreme commute for the long haul, since most jobs in small towns don't come with the big city salaries required to support large homes. While a financially cautious commuter could spend a decade doing the drive, pay off any outstanding bills and then trade in the commute for semi-retirement (or least a lower-paying job closer to home), the people in the big houses often can't afford to stop working in the city. (To learn more, see Paying Off Your Mortgage and Mortgages: How Much Can You Afford?)

Long commutes also result in higher maintenance costs for cars and trucks, as well as big gasoline bills. While few people keep a car long enough to make vehicle replacement an issue, racking up more miles on your automobile does mean that you will need to change your oil, replace your tires and buy brakes more often than your city-based friends. (For more insight, see Getting A Grip On The High Cost Of Gas.)

To Drive or Not to Drive?
The decision to make extreme commuting part of your lifestyle is largely a matter of personal choice. Will cultural opportunities and fine dining offset the need to live in a small apartment or an overpriced, undersized house? Or will wide open spaces and family-friendly places offset the hundreds of hours you will have to spend on the road? These are decisions that each person must make for him or herself. However, with the continued high costs of housing in metropolitan areas, it is likely that the 3.4 million extreme American commuters will continue to grow as more workers decide to hit the highway. Extreme commuting may not be for everyone, but for those who accept the tradeoffs, using a hefty city-based salary on exurban expenses can provide good value.

For related reading, see Wheels Of A Future Fortune.

Related Articles
  1. Retirement

    5 Ways to Use Your Home to Retire

    Retirement is going to cost a lot, and for homeowners who face a shortfall, their home can be a source of income. From downsizing to renting, here's how.
  2. Home & Auto

    Read This Before Buying a Vacation Home with Friends

    Going in with friends to buy a vacation home will save you on the mortgage and expenses. But if there's conflict, it could end up costing your more.
  3. Home & Auto

    The Most Expensive Neighborhoods in London

    Understand what makes London such a desirable place to live and why it is so expensive. Learn about the top five most expensive neighborhoods in London.
  4. Professionals

    How to Get Boomers & Millennials To Work Together

    Baby boomers and millennials don't often see eye to eye, but getting these two generations to play nice is important for any company.
  5. Home & Auto

    Why Housing Costs Shouldn't Exceed 30% of Your Budget

    Financial experts will argue that there’s no problem with allocating 50% of your net income to housing, but that barely leaves enough money for living comfortably. Reducing housing expenses to ...
  6. Investing Basics

    Tiny House Movement: Making Market Opportunities

    The tiny house movement throws all assumptions about household budgeting and mortgage management out the window, and creates new market segments too.
  7. Investing

    Where Should I Keep My Down Payment Savings?

    While saving up for a down payment, where should you keep your money. A bank? The stock market? It all depends on your timeline.
  8. Home & Auto

    The Most Expensive Neighborhoods in Manhattan

    Understand why Manhattan has some of the priciest residential real estate in the world. Learn about the top four most expensive neighborhoods in Manhattan.
  9. Home & Auto

    The Most Expensive Neighborhoods in Los Angeles

    Understand the layout of the greater Los Angeles area and what is driving up home values. Learn about the top eight most expensive places to live in LA.
  10. Credit & Loans

    Yes, You Can Buy a Home with a Reverse Mortgage

    A special type of FHA-insured reverse mortgage called the HECM for Purchase lets seniors use a reverse mortgage to buy a home.
  1. Can I borrow from my annuity to put a down payment on a house?

    You can borrow from your annuity to put a down payment on a house, but be prepared to pay an assortment of fees and penalties. ... Read Full Answer >>
  2. Can I take my 401(k) to buy a house?

    Once you reach 59.5, you can use the funds in your 401(k) retirement savings account to buy a house or any other expense ... Read Full Answer >>
  3. Can I take my 401(k) to buy a house for my children?

    Under the standard regulations for 401(k) retirement savings plans, you may elect to withdraw funds from your 401(k) for ... Read Full Answer >>
  4. How is market value determined in the real estate market?

    Anyone who has ever tried to purchase or sell a home has probably heard a lot about the property's fair market value, or ... Read Full Answer >>
  5. What does the American Dream mean to different generations?

    The American Dream at its core is the belief that every generation should enjoy greater prosperity than the generation before ... Read Full Answer >>
  6. What are the most common business deductions and expenses for small businesses?

    Among the most common expenses and business deductions for small businesses are the expenses of getting the business started, ... Read Full Answer >>

You May Also Like

Trading Center
You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!