Do I need a car?

I recently read an article from a new blog source I have: the 'Barefoot Investor' who specialises on providing financial advice for those not from the 'grey brigade'. The article was justifying why one would not own a car. I shared similar concerns when I sold my car earlier on this year and actually posted the costs associated with owning a car.

I have not owned a car for the last 6 months, although does it count if you are living in Europe? So what if I was living in Melbourne again? well - this is a thought I have tossed around recently.

It is true, the advantages of owning a car are predominantly subjective: (i) it can be enjoyable to drive (well I enjoyed driving my WRX); (ii) it is convenient (for shopping, etc.); (iii) it can be a part of your identity (status?). But, and this is a BIG but - a car is v.expensive! it does not make sense as an investment - by its nature it depreciates rapidly in the first few years of ownership; there are annual registration and insurance costs, and petrol is so variable - all these costs add up. Moreover, a car is not necessary - you can enjoy other aspects of traveling (e.g. reading in public transport), you can shop frequently (in small amounts) to avoid the need for a car, and even for weekend-getaways you can hire a car! There are also short-term hire car services available in the inner city suburbs of Melbourne - and your carbon footprint is significantly reduced.

So - I have decided - I am going to try not to own a car in the short / medium term. Like it is mentioned in the article - I am going to 'tread my own path' and bugger off status / perception.

Now all I need is that my girlfriend and all my mates to live near me ;)

Bye, bye blue

DSC00642, originally uploaded by markyjones.

Well, it is a sad day - 24.04.2006, I sold my Subaru, MY05, World Rally Blue, WRX. Owned for 19 1/2 months (purchased September 10th, 2004) and sold for $33K.

Interestingly, I read an article in Smart Investor, April edition, 2006 which quantified the cost of a car, in terms of the loss of its value (i.e. depreciation) daily. From the article, the cost of other cars (and the cost of what my car ended up being) were:

evils of depreciation ...
Porsche 911	$111.23/day
BMW 330i	$49.59/day
Holden Commodore VZ	$37.12/day
(my) Subaru MY05 WRX	$15.17/day
Hyundai Accent	$14.77/day

Some interesting concepts are raised by this including what a car actually costs? This is what I broke it down to being:

and more costs!
insurance	$4.50/day
registration	$1.70/day
petrol	$1.70/day
services	$0.85/day

Sheesh! so according to this my car cost approximately $25 a day - thats more than what I pay for rent - that is a fairly expensive total cost of ownership (TCO) - and I haven't even mentioned the environmental costs - something for a later blog.

I will say this, however, it was a great ride - see you later subie ;)