Last year I went without a car in my first year of graduate school. The result? I saved myself $2000 in student loans, just in parking, gas, and insurance. With education costs rising, cutting out car expenses can really be a smart move to consider for any student. Here are a few ways that doing so will save some money:
Insurance: Especially for undergraduate students, insurance isn’t cheap. Insurance companies operate with an age penalty that rears its ugly head in insurance premiums until age 25. Why not smile and say no thanks to this extra charge from insurance companies?
Parking: These costs can be outrageous especially if you go to school in a city. During a graduate school interview I met a girl going to school in New York City. Parking costs amounted to $25. Every single day. And she drove. Every single day. Even if you don’t go to school in a city, colleges give undergraduates their parking spots out in the boondocks. Why not just walk or take a bus that drops you off right in front of the school? You won’t have to trek in from the Netherworld and you’ll save yourself some money.
Maintenance: When you are in college are you really thinking “when was the last time I got an oil change” or “Gee, I think it might be time to get my spark plugs switched out.” My thoughts are more along the line “What on earth is going on in my chem lab today?!” Maintenance costs can not only trim expenses, but simplify life. Not to mention, skimping out on routine repairs if you do have a car can reduce the life of the car and cause even more car expense.
Gas: Crude oil is at record prices. And there appears to be no end in sight for prices to continue to increase. Enough said.
Car payments: First of all student loans are not allowed to cover car payments. Car loans have higher interest rates than student loans. Add on a young student with a scant credit history and their interest climbs even higher. If mom and dad can help out that’s great. But note to mom and dad. You have a lot of other expenses to worry about too – retirement, health care, mortgages, and your own cars for instance. Read on and see that your student does have a lot of other options and can get just as great an education without the added expense of some wheels.
So how’s a student supposed to get around if they don’t have a car?
Zipcar: Worried about getting to the grocery store? Check out Zipcar. Zipcar rents cars complete with insurance for 9 bucks an hour if you don’t have a subscription. Zipcar is spreading like wildfire among college campuses because they are finding that this helps reduce traffic and free up parking spaces. What’s more, it includes gas.
Walk: A very underrated activity. Help kick the Freshman 15 and get the blood going before class. Trust me. It’s a lot easier to stay awake in class.
Public Transport: Most cities offer student discounts for monthly passes. Even with a car this year I found getting a monthly pass saves me a couple hundred this year from parking on campus.
Hitch a ride: Some of my favorite memories from college were piling 4 other friends or perfect strangers into a car to go somewhere. From road trips to movies in town, a car full of college students is an easy and fun way to get by without having a car.
Get creative. Scooters, bikes, rollerblades: when I was an undergrad, there were even some guys in who unicycled to school every week. Why not? Part of what makes college so fun is students can get away with that sort of thing. And need I mention it’s cheap.
Part of personal finance is using some ingenuity to find solutions to expenses. Going without a car was a great exercise for me in ingenuity. It’s a great skill to develop during a student’s early financial years which can later be applied to even bigger expenses.
Image courtesy of pbo31