Is having a car really worth it at all?
With his car still in the shop, Cooper took Uber to happy hour; the next morning, he took a Lyft to work, then an Uber home. He began walking everywhere within two miles of his apartment, trading convenience for sunshine. Soon, he lost all sense of urgency to pick up his ailing Bimmer. By paying his bills, he let the car make one final, four-figure blow to his bank account, then he sold it on Autotrader, in no rush to find a replacement.
That was two years ago. Cooper has since joined a small-but-growing percentage of Millennials who’ve ditched their cars to instead rely on ridesharing for commuting and jaunts around town.
Today we’re going to explore five reasons you should join them:
1. It’s cheaper
For many of us, having a car is like paying a second rent. The only difference is that the costs aren’t nearly as predictable month-to-month. To merely own a car requires monthly financing or lease payments, titling, registration, insurance, and depreciation costs.
If you wish to actually operate your car, you’ll need to pay for gas, scheduled maintenance, buy new tires eventually, wash your car, and other fun, unforeseen expenses.
What’s the financial bottom line? If you finance or lease a $33,000 car, you can expect to pay $10k/year for the first several years.
By contrast, if you live within five miles of work, the cost of ridesharing can be well under $5k/year. Yes, it becomes cheaper to own the car each year, but the costs of a new car won’t even out to ridesharing until the twelfth year of ownership.
2. It’s more rewarding
In April 2016, Uber rolled out its UberVIP program so quietly that today, most people still aren’t aware it exists. To become a VIP, you must complete 10 rides per month and maintain a high passenger rating. If you ditch your car to rideshare commute, you’ll easily achieve this status and enjoy its signature perk. For the same cost as an UberX, you can summon an “UberVIP” car, with a highly-rated driver in a nicer-than-average vehicle. UberVIPs enjoy the pseudo-luxury of Buicks, Acuras, and Avalons, while the rest of us suffer in the comfortless cloth seats of Priuses and Corollas.
Lyft’s incentives are more heavily geared towards drivers, though riders can rack up Delta Skymiles by registering both accounts at deltalyft.com.
Keep in mind, however, that as both Uber and Lyft continue to aggressively develop and modify their business models, perks may be introduced or discontinued on a whim. For example, just weeks ago, Uber ended their partnership with Starwood Preferred Guest, which allowed riders to accrue hotel points with each ride.
Like airlines, however, ridesharing apps will surely always offer some sort of loyalty incentive, much to the profit of the rideshare commuter.
3. It mitigates risk
According to an outdated albeit interesting joint survey between HuffPo and YouGov, 63 percent of Millennials admitted to texting at a red light, compared to just 53 percent of Xers and 40 percent of Boomers.
While legal in some states (even New York), texting at red lights is more dangerous than you might think. The last time you looked up from your phone and saw the light had turned green, did you first look both ways to make sure no pedestrians were still in the crosswalk? Or did you just gun it, so as not to irk the driver behind you?
Even if we’re stationary, reducing our focus and situational awareness while operating a two-ton vehicle significantly multiplies our chances of causing an expensive, perhaps even fatal accident.
Ridesharing all but eliminates this risk. A Consumer Affairs investigation found that in addition to driving newer, safer cars, ridesharing drivers better maintain their rides than the average commuter, keeping up with maintenance and safe. Plus, if an accident were to happen, you’d be in the back instead of the front, statistically the safest part of the car.
While your responsible UberVIP driver absorbs the elevated risks of driving, you can text or type to your heart’s content in the backseat, leading us to a lesser-celebrated perk of ridesharing…
What would you do with an extra 50 minutes per day, or four hours per week with your computer? Get some extra work done? Start that book? Plan a vacation?
That’s how much time Cooper won back in his day when he began commuting from the back of a Lyft. In line with the national average, he spent over 200 hours per year commuting: listening to podcasts and Spotify, but otherwise wasting the time away.
Now, armed with a laptop and mobile Wi-Fi, he turns the back of UberVIPs into mobile offices. He even claims that he’s paid off his annual ridesharing bill doing contract work from the back of Buicks, Mazdas, and Volvos.
He doesn’t always work, however. Sometimes, he just wants to have a conversation.
As countless pop stars have lamented in their lyrics, technology is disconnecting us. Uber and Lyft, however, serve as vehicles (no pun intended) for meeting people outside of our bubble, sharing a conversation, and departing before things get awkward.
Between Lyft’s statistically happier drivers and UberVIP’s curated driver list, rideshare commuters can expect to meet polite, colorful, and interesting characters at a frequency even podcast hosts don’t get.
Still, this level of potential interactions could be a pro or a con, depending on your degree of extraversion. If you’re one of those people that wishes Uber had a “no small talk” option, the threat of broken silence alone may be enough to deter you from the ridesharing lifestyle.
To sell or not to sell?
Now that we’ve reached the end of our list, you might be wondering: What reasons are left to own a car in the year 2018? If you’re even a mildly-extroverted, financially-savvy urbanite, there may not be many left.
While we’re financially-minded here at Money Under 30 and love saving you a buck, we also love cars. In fair defense of our four-wheeled friends, before wrapping up, here are five things you may regret giving up if you choose not to own a car.
Paying off a car is a great way to turn average credit into excellent credit in preparation for applying for a mortgage.
With a large down payment, you can minimize your interest and monthly payments to ensure you always pay on time, and by the time the car is yours, you’ll have a four to five-year record of on-time payments to bolster your credit score.
What if Uber decides to apply surge pricing to your commutes each way, and your transportation budget suddenly doubles? What if there are simply no drivers available when you’re late for a date or a meeting? What if your city (Austin) or country suddenly bans ridesharing? What if your passenger rating drops and suddenly nobody will pick you up?
Lyft and Uber have proven convenient, if not always dependable, modes of transport. Rideshare commuters can expect a delay, or a surge prices, several times a week. UberVIP does not solve the issue, as UberVIP drivers are currently rarer than a regular UberX. Furthermore, the ridesharing never-ending legal battles don’t support a vision of stability.
While expensive, owning your own mode of transport is a dependable way to get where you need, when you need (well, unless you drive a high-mileage Fiat).
While Uber and Lyft connect people, they won’t reconnect you to your college friends a state away. Lyft has a maximum range of 60 miles, and while Uber technically doesn’t have a trip limit, it does require you to “notify the driver” of a long drive, presumably so they can decide not to pick you up in advance.
Cars enable the freedom to explore other cities, states, even countries with little advance planning. And while the bus is a more frugal alternative, a ten-ton Greyhound that dumps you at sketchy parking lots at two in the morning doesn’t quite evoke the same sense of liberation.
4. Peace and quiet
Most Ubers aren’t Maybachs, and don’t feature the soundproof plexiglass you can slowly raise in delicate bourgeois fashion to divide yourself from the driver.
Aside from your bedroom, your car may be the only private space you have in your life. It’s your space to vent, have intimate conversations, or blast your pump-up playlist on the way to the gym.
5. The joy of driving
Now that car manufacturers have generally mastered things like safety, tech, and luxury, they’ve turned their attention to making their boring cars fun, and their fun cars exhilarating. Last week we drove a 2018 Kia Rio, a car that costs $13,900 new, and it was a blast, taking us back to our go-karting days in eight grade.
Purpose-built fun cars like the Mazda MX-5, Toyota FR-S, and VW Golf GTI are so beloved by their owners because they turn the “task” of driving into a thrill that never wanes for a decade of ownership. Unlike high-end Porsches and BMWs, these cars are designed to be fun at legal speeds, and can be bought for under $20k.
While they’re ironically cheaper to buy and insure than your average midsized sedan, there’s little financial justification for buying one of these sports car instead of ridesharing. But if you place a high price on your own happiness, the ROI of a fun daily driver is immeasurable.
While we’re die-hard fans of driving (especially manual transmissions), we concede that for many of us under 30s, especially in urban areas, owning a car doesn’t make financial sense against ridesharing. Uber and Lyft are convenient, safe, and as long as the two are at each other’s throats, will remain competitively cheap.
However, these apps cannot entirely replace the conveniences, freedom, and potential joy of owning our own ride. Before you abandon driving entirely, you have little to lose by test-driving a few fun cars within your price range.
We can’t absolutely say you should sell your car and rideshare or not, but we can say with certainty that you should look closely at which would benefit your lifestyle, budget, and happiness in the long-term.
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