Tuesday, September 22, 2009

Budgeting 101 - Part 6, Transportation

So far, we've completed 3 sides of our perimeter; God, Food and Shelter.  The West wall will complete the circle.  The final side of our perimeter is, transportation.  You have to be able to get to work, school, church, grocery store, etc.  So figure it into the budget. Plan for it so you're not surprised:

  • car payments (though, these will be temporary)
  • gas and oil (including oil changes)
  • insurance
  • license and registration
Later on, we'll budget for maintenance and repairs, but for now, we're taking care of the basics.

As you can see, I'm only describing BASIC transportation.  I highly discourage automobile loans.  They are not necessary. If you've read IOU NO MORE, you know I've outlined a plan so that you'll never have to make a car payment again......ever.

On a side note, I can't even begin to describe how much I loathed the recent "Cash for Clunkers" program.  The memory of it, still makes my blood boil.  Millions of Americans now have new debt they can ill afford.... Ok, Sam, relax.  Have a coke and a smile.

There are still a few things we can do to save on transportation costs.
  1. Sell your car and buy a 'cash car'.  It's the only kind I drive.  I rent nice ones on vacation, but I drive paid for older ones for every day.  It saves, by eliminating payments and reducing insurance
  2. Increase your deductable on your insurance
  3. Car Pool 
  4. Whenever your job allows it, work from home one day a week
  5. Walk, or ride a bicycle to things that are close enough to do so.  This saves money and improves health at the same time.  I love multi tasking.
  6. Change your oil every 5k rather than 3k miles.  Many studies have shown that this is optimal.  But, DO change it.  Changing your oil costs a little at the time, but will save on costly repairs in the long run.
  7. Put a little thought into your excursions so that you accomplish multiple tasks on a single trip, rather than taking multiple trips out.  
  8. Use public transport whenever possible.  When I lived in the United Kingdom, I used bus and train services frequently.  There are places here in the States where this is still a valid option.  Take advantage of it.  It could save you a bucket full of cash.  
Saving money on transportation is not as easy, or as sexy as some of the other boundary items, but it's critical.  Transportation costs can be real budget busters, so plan carefully, write it down and stick to the budget.  Your wallet and your future will thank you. And remember, we'll happily provide you with a FREE Basic Spending Plan.  We're here to help.