You Drive Too Much – The $5 Plan

You drive too muchYou probably don’t realize it, but you drive much more than you need to. You get into your car much more often than you should, but there’s a simple way that you can make sure that you only drive when you need to — by paying yourself a small fee every time you get into your car.

Basically, the reason that you drive more than you need to is because there is nothing to encourage you to take a moment and consider whether or not you really need to to use the car. While there are costs that are associated with driving the car, you don’t actually see these costs as you drive. When you decide to take a quick trip to the store to get something that you accidentally forgot to purchase, you don’t think how much wear and tear it will cause the car, how much gas it will expend or any of the other cost associated with driving the car. You simply get in the car and drive to the store because it’s easy.

The truth is that there are real direct and indirect costs each and every time you drive your car. So the question becomes, how do you remind yourself about the costs of driving your car? There is a simple remedy for this problem. All you need to do is charge yourself a $5 fee every time you get into the car.

There is something about the process of having to take out $5 and place it into the collection box each time you want to drive. It is exactly the little nudge that you need to make you step back and consider, “Is this trip truly necessary?”

When I tell people that I have to pay $5 to use my own car, they look at me like I’m crazy. Why would you ever pay to drive your own car? My answer is that doing so will dramatically change your driving habits for the better and improve your finances far beyond what you imagined. These are some of the direct results from implementing this system:

We are much better organized. It’s amazing the number of “necessary” trips you make when you can just get into your car and go. When you have to pay five dollars to use the car, however, many of those small trips don’t seen near as necessary. What happens is that you delay the trip until you have several errands that you can do all together.

We shop (and spend) a lot less. Since we aren’t taking constant trips to the store there is a lot less opportunity to purchase impulse items and such. We also aren’t wandering around the store wondering if we need to purchase something else. Since we need to now organize our trips into one outing, we know exactly what we need to purchase on those trips(another positive aspect of being better organized).

We save time. The combination of being better organized and taking fewer trips means that we have more free time than we did when we could use the car whenever without paying. It’s amazing the amount of time we wasted driving here and there.

We pay less in gas. Since implementing this program, we drive about 40% less than we did before paying for each drive. That has meant spending a lot less on gas than we had been. It has also meant that we qualified for a discount on our auto insurance for driving less. Although I have no real way to measure (our car has always been in good shape and we have never had any trouble with it), I assume that the wear and tear has decreased meaning we will pay less in repairs. I do know that the standard maintenance such as changing oil and air filters doesn’t need to be done so often.

We exercise more. We would have never thought about jumping on our bike to go to the movies or walking to the post office before we implemented the $5 rule. Now these are common occurrences. We get more exercise as a direct result of not taking the car every single time we leave the house.

We are helping the environment. While we always talked a good game about how we needed to help the environment, it was a lot of talk. Now that we drive less, we know that we actually are doing out part to help the environment.

We never have to worry about money for repairs. The money that we collect for driving the car is our “car fund” and is what we use to pay for all expenses related to the car. If a repair is needed, the money for that is available.

We will never have to finance a car again: The car fund, even with the reduced amount we drive, is enough that we will never have to finance a car again unless we choose to. This means we can pay in cash and get the discounts associated with that – not to mention not having to pay to borrow money.

As you can see, placing a $5 fee on your driving can have a huge effect on both your driving habits and your finances. Don’t get me wrong. We still take plenty of fun trips and enjoy a good Sunday drive. Almost all the driving reduction has come from not going out each and every time we forget something plus streamlining a lot of the trips we were making before into a single one.

You do drive too much. Much more than you ever imagined. If you want to see, try this pay to drive system. I think you’ll be amazed at the changes you see in your driving habits after a few months.

This entry was posted in Cars, Insurance, Personal Finance, Saving Money. Bookmark the permalink.

9 Responses to You Drive Too Much – The $5 Plan

  1. The Driver's Notebook says:

    Great tips! Those simple things can help save money as well as protect our car. Cars if well taken care of can prevent it having trouble such as damages and this also help save fuel mileage. If only these things be taken into consideration, we can really improve our driving habits and at the same time help ourselves save money and free from those unnecessary expenses.

  2. Jamie says:

    I’m car-free by choice. I walk to the grocery store once a week, I walk to the downtown shopping district, I walk to work, I walk to grad school, I walk to the doctor’s office. I take the bus to the vet, I take the bus to the mall. On those rare occasions (about once every 2-3 months) when I need kitty litter or another heavy or bulky item that just doesn’t work well on the bus, I use Flexcar – a car sharing program. I pay $8 an hour for the car, and beleive me, by having to pay for the car, I know exactly where I’m going, and I schedule for a time of day with light traffic! I gave up my car over a year ago, and now my transportation costs are down to an average $27 a month (bus pass and Flexcar) from over $1000 a month (insurance, parking, gas). It’s so nice to not have to worry about a car anymore. The best part is, with the money I’ve saved, I’m able to finish my last year of grad school without loans!

  3. Melisa says:

    I LOVE this article. What a great idea. I have a love/hate relationship with my car – love how convenient it is, but how how much it costs and how much I rely on it. I’m going to implement this plan starting today. I love the idea of saving money in a “car fund” for repairs and future financing. And helping the environment is pretty great too! Thanks for the info!

  4. Wai Yip Tung says:

    This is an excellent scheme! Use the ‘car fund’ piggy bank to pay for gasoline, maintenance, insurance, car loan, tax, etc. If the money you put in approximately cover these expenses, you have arrived in a correct pricing for car use (it is like to be even more than $5).

    Right now the price indicator of car usage is broken. Since the owner do not need to pay any cash to use his own car, the marginal cost per trip is considered free. Most costs are paid upfront (car price, insurance). Even those directly related to usage, such as gasoline cost, the driver has difficulty to relate this to his car usage. This sometimes reflected in irrational behavior such as driving an extra 10 miles to a gas station that is 5% cheaper, such that the saving in price offset by extra fuel consumption. As the marginal cost of driving is consider 0, people ride their car instinctively for anything.

    Car sharing has an excellent pricing model. Members pay nothing upfront. They are charged base on actual usage. While it seems expensive to be billed for something like $20 for a one to two hours trip, this price is actually closer to the real cost. When you project this number over long term it is likely to result in substantial saving over owning a car. Just because it costs $20 for a short trip ready makes you cut down on impulsive driving.

  5. Pat says:

    Very good article! This is being discussed by The Dollar Stretcher Community, so I had to come and see what they were talking about.

  6. Pingback: The Evangelical Ecologist

  7. Fern says:

    good article!

  8. Gail says:

    My parents sold me their old van for $1 last Nov.1. Since that time I think we have filled up the car 5 times and have only driven about 1500 miles. I have arthritis and it is very tempting to use the car for every little thing I need to do. Instead I tell myself I’m getting necessary exercise which is far more important. Of course, if I have to go somewhere when I’m having a bad flare-up, the car is there, one of the big reasons that my parents sold it to me. I also ride share trips to the grocery store every couple of weeks. I like the idea of paying to use the car, but I’m into dollar stretching to make the most of our money and so don’t have $5 to stuff in the kitty every time I use the car, but I am very conservate with its use, especially since I went 2 years without us having a 2nd car, we had to get creative on car use with hubby going to work.

  9. Quest says:

    This is the 21th century. How about coming up with some new inventions and ideas to help improve gas mileage.

Leave a Reply

Your email address will not be published. Required fields are marked *