The True Cost of Commuting
No one enjoys commuting: it's a waste of time, fuel, and money. How much money? According to one new infographic, you spend $795 a year for every mile you live from your place of work -- enough to pay the interest on $15,900 of a mortgage.
Let's start with the worst-case scenario: if you travel 38-miles round-trip to work (the average American commutes less than 40 miles per day), and you use the IRS estimated cost of driving to be $.51 per mile (including financing, maintenance, depreciation, and so on), your commute costs just over $19 per day. Multiply that by 250 workdays per year, and you get $4,750 spent on commuting.
But what if you own a fuel-efficient car and it's all paid off? In that case, you might be able to drive down the cost-per-mile to $.17 (plus insurance), which averages out to $1,615 for the year.
To be honest, though, most of us aren't in that position. So what if we split the difference between the low and high ends, assuming a per-mile cost of $.34? Fine. Take that sum, multiply it by two to account for your round-trip, then multiply by the number of work days in a year (the infographic uses 250). You find that your commute costs around $170 per year for every mile you live from work. If you add in the cost of your time lost on the roads, the figure goes up to $795, which is roughly the cost of the interest on $15,900 worth of mortgage with a 5% interest rate.
As with any collection of data, it's always a good idea to examine the source. In this case, the source happens to be Streamline Refinance, which is obviously in the business of encouraging people to purchase homes or refinance the mortgage on their existing digs. Telling people they can buy a more expensive home if they live closer to work is exactly the sort of thing you'd expect to hear from a company like Streamline.
(Also, much of the graphic is written in a font situated halfway between Comic Sans and Tekton. That may not affect the validity of the data, but for design snobs, it's cause for suspicion.)
Nevertheless, Streamline's numbers are interesting. Even without factoring in the cost of personal time wasted on the road, it's clear that commuting is a creeping expense -- one that seems relatively small, but adds up in big ways over the course of a year.
Of course, we're not mortgage agents or number-crunchers, so we'd appreciate some input from CPAs and other mathletes. Feel free to leave your two cents in the comments below.