Why You Can't Afford Not To Have A Car

You've probably read that if you're worried about money, you shouldn't own a car. Cars are expensive to purchase and have ongoing costs such as gasoline, maintenance, repairs and insurance. It's easy to spend several hundred dollars each month for the luxury of owning a car, and if money is tight, that several hundred dollars might be better spent elsewhere. What we often overlook are the ways that owning a vehicle can actually benefit us financially. Here are the ways that owning a car might actually allow you to come out ahead. (For related reading, also check out 5 Ways To Buy A Used Car.)

TUTORIAL: Budgeting Basics

1. Increased Job Opportunities
Perhaps the biggest financial drawback to not owning a car is that it limits you to working within an area to which you can walk, bike or take public transit. If you want to have a short commute, this limits you to jobs within perhaps a five mile radius of your home. If you live in an area with few employment options and you don't own a vehicle, an exhausting commute, underemployment or unemployment are strong possibilities.

If you own a car, suddenly a job that's 30 miles away doesn't become so difficult to get to. That increase in opportunities improves your chances of finding a job that pays you what you're worth and increases your odds of getting a job on a desirable career path, not just something that pays the bills. Also, some jobs require that you own a car; if you don't own one, you're not eligible no matter how qualified you might otherwise be.

Furthermore, owning a car means that you can adjust your work hours to meet your employer's needs, whether it means coming in early or staying late. You don't have to worry about whether a bus will be available or whether it will be safe to wait at the bus stop when you have to work until 8:30 at night. Your employer will value your added flexibility and dedication to your job, which should be reflected in future promotions and pay increases.

2. Expanded Housing Possibilities
You may already have good job opportunities without owning a car if you live in an area with lots of employers. But housing costs in these parts of town almost always come at a premium.

You might prefer to put the $200-$500 a month you could have spent on a car toward rent or a mortgage in such a location. But you could also put that money toward a car and live somewhere that cost $200 to $500 a month less. Why would you want to do that?

While there might only be one or two parts of town that provide lots of job options, there are probably many more parts of town that offer reasonably priced, safe places to live. When you have a car, you can access these areas. You might have access to safer, newer or more spacious housing than you would otherwise.

Owning a car can be a big help if you want to own a home because it allows you to keep your high-paying job in the expensive part of town while buying a modestly priced home in a lower-demand area.

TUTORIAL: How To Manage Credit And Debt

3. Shopping Possibilities
When you own a car, you have access to a greater selection of stores. You can go wherever you can get the best deals instead of wherever you can walk or bus to. If this flexibility means you can cover your monthly grocery needs for $250 a month instead of $500 a month, that savings alone can be enough to cover the cost of owning a car. For many people, being able to drive also decreases the time it takes to run errands and makes it easier to combine several small trips into one larger trip.

4. Stocking Up During Sales
If you have to walk, bike or take public transit, you're pretty limited in the amount of stuff you can buy in one trip to the store. Not owning a car means that if you want to stock up on an item when it's on sale, you'll either be limited in how much you can buy, and therefore limited in how much you can save, or you'll have to make more than one trip to the store, which will cost you time. The alternative is to just pay full price most weeks and only be able to benefit occasionally from sales. None of these options are great. If you have a vehicle, you can buy several months' worth of your personal staples while they're on sale and buy the majority of what you need when it's at the lowest possible price. Shopping this way can save you hundreds of dollars a year. (Saving money is great, but how far will you go? Check out 5 Signs Your Coupon Habit Has Gone Too Far.)

5. Cheaper Travel
If you have to travel from Seattle to Miami, it's unlikely that driving will save you money. But for trips that take less than a day by car, having the option to drive to your destination can really save you money. If it costs you $80 in gas to drive 600 miles and the alternative is $200 plane ticket and a $150 car rental at your destination, owning a car can really help you come out ahead. This is especially true if you have other people that need to make the trip with you. The driving cost doesn't increase when you add people to the car, but the plane ticket price multiplies when you add people to a flight. If short trips like these are a regular part of your life, it can really make sense to own a car. (For more travel tips, take a look at Tips For Skipping Air Travel.)

Owning a Car Doesn't Have to Be a Financial Liability
Unless you can safely walk or bike everywhere, you still have to spend money to get around when you don't own a car. The money that you put toward public transit can go toward car insurance. If you buy an inexpensive used car, it won't depreciate dramatically like new cars do and the insurance payments will be low. If you buy a reliable model and maintain it properly, your repair costs should be modest and fairly predictable. As long as you're responsible in your choice of vehicle, it's not that hard to come out ahead, or at least break even, by owning a car. (For additional reading, also see 5 Reasons To Buy A New Car.)