By Jason Alderman
Most baby boomers couldn’t envision their early adult years without a car. However, times are changing and younger commuters are leading the way.
According to an October study (http://uspirg.org/reports/usp/millennials-motion) by U.S. Public Interest Research Group (U.S. PIRG) and the Frontier Group, millennials – those born between 1983 and 2000 – are driving significantly less than older Americans. Many post-college drivers swimming in college debt are opting for urban living (http://time.com/72281/american-housing/) where walking, biking and mass transit tend to be easier options. Increasingly, those with a temporary need for four-wheel transportation can do so by smartphone.
Today, there are many options to conventional car ownership, but it’s important to match solutions and their specific costs to your needs. Here’s a road map for exploring what’s right for you.
Start with the cost of driving. If you already drive and budget carefully, you will have an idea of what driving costs you can incur each year in financing, fuel, fees, maintenance and insurance. For averages related to a range of vehicles, look to the American Automobile Association’s (AAA) latest “Your Driving Costs” statistics. Keep in mind that smart car ownership doesn’t always mean “new.” Online references like Edmunds.com and Kelley Blue Book can help you spot used vehicles that hold their value and keep operating costs reasonable.
Would leasing be cheaper? The buy-versus-lease question has evolved over the years and many people have strong opinions about which option is better. The answer depends on your personal situation and how you plan to use the vehicle, so consider the pros and cons (http://www.practicalmoneyskills.com/buyorlease). Many people like leasing because they can often lease a more expensive car than they could afford to buy with no down payment. But failing to observe lease restrictions can cost plenty. Remember that all leases can be negotiated and it’s important to review the terms and fine print very closely.
Read more about the potential to free yourself from car ownership at: http://www.practicalmoneyskills.com/personalfinance/experts/practicalmoneymatters/columns_2015/0116_LiveWithout.php