how much is it costing you to get to work

This photo was taken less than a year ago and is already obviously out of date

You generally think of work as one of the things that puts money into your bank account, but working does also cost you. Getting there and back is a hit, as is the cost of coffee, lunch, and any socialising you do. If you walk to work then getting there is free, of course, but many people have a significant journey to work and back. This is easy enough to work out if you use public transport, but it is one of those nasty little creeping expenses that mounts up stealthily over the years if you drive to work.

In my attempts of purge life of some of these costs, I am cycling to work. When I moved here I made sure that I did not live too far away from work – my London commute was 1 1/2 hours each way for a journey of 15 miles, and I knew that I didn’t want to live like that in future. I live about 6 miles from work, which is far enough away to not see it on the weekend and close enough to bike. In the interests of getting visibility I figured I should change my drop-handlebar bike for something more upright, so I wanted to evaluate the business case. I’d have a car anyway, so I will stick with simple fuel costs for calculating my savings. The results were interesting – the following Javascript calculator is preloaded with my costs, but it will let you work out your own costs if you put in your own distance, MPG and petrol costs.

It surprised me – a classic old personal finance saw is that the cost of a daily skinny latte mounts up over a year, and here I was paying about the cost of a latte just to get to work and back. It validates my viewpoint on the bus service, which would cost me over twice the cost of driving. And it does add something to think I am saving £1.64 on a bike day, which adds up to about £300 a year, allowing for the fact that I don’t bike every workday, particularly in winter.

The bus service is a non-starter for two reasons. One is that due to my company’s decision to outsource a lot of the work, the outsourcing company brings people in from India on temporary 3 to 6-month contracts. Their employees aren’t here long enough to get their own cars, so they naturally use the bus. As a result it’s hard to get on the bus unless you join at the starting bus station in town. Secondly the bus service is a ripoff, £2.50 each way!

Running a car is one of the big hits in personal finance. There’s already the big one-off hit of buying it, plus the fixed costs of running a car – tax, servicing and insurance. All of these things are part of the decision whether to get a(nother) car in the first place. The utility of having a car is pretty clear in most people’s cases, unless you live in the centre of London or New York. When I living in London I got a car just before leaving the city, and I had to park it about 200 yards away!

I was surprised at the cost of what is a pretty short commute. People don’t often factor in the cost of going to work in their decision of where to live, it is usually mainly the amenities of the area and the practicality of of the commute in terms of time.  As an example, many colleagues come in from 20+ miles away, and these guys are effectively taking a £1k a year pay cut every year compared to me, and the guys doing this with Land Rovers (assuming 25mpg for the LR) are eating a £2000 pay cut.

It also meant in about seven months I’d recover the cost of the bike. I don’t cycle in December of Jan/Feb and I don’t do it if rain is forecast so I’m only halfway there so far. As petrol costs rise the case for cycling gets stronger.