Saving Pennies or Dollars? Riding a Bicycle

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saving pennies or dollarsSaving Pennies or Dollars is a new semi-regular series on The Simple Dollar, inspired by a great discussion on The Simple Dollar’s Facebook page concerning frugal tactics that might not really save that much money. I’m going to take some of the scenarios described by the readers there and try to break down the numbers to see if the savings is really worth the time invested.

Ron writes in: Does it really save a lot to ride a bicycle around town instead of driving? I have a Ford pickup that gets about twenty miles per gallon If I were to drive to the post office and the grocery store, it would be a four mile round trip. From what I can see, that bicycle ride would only save me about sixty cents in gas.

This is a lot trickier than it sounds. The biggest reason is that the cost of using your truck for this excursion is much greater than just the cost of gas. So let’s start by running through these expenses.

Gas If gas is $3.50 a gallon and your vehicle gets 20 miles per gallon, that’s $0.18 per mile just for gas.

Prorated cost of the vehicle Let’s say you bought this truck for $15,000 and intend to drive it for 100,000 miles. That means that the cost per mile for the vehicle itself is $0.15.

Oil If you can get your oil changed for $30 every 3,000 miles, you’re adding $0.01 per mile to your drive.

Other maintenance This varies so much from vehicle to vehicle that it’s difficult to estimate, but I’d put it at at least $0.03 per mile.

There’s also the fact that some number of failures are going to happen while you own the vehicle, which has to be prorated into the cost. If you have three repairs of $1,000 each, you’re going to be spending $0.03 per mile to effectively cover those repairs.

Insurance Insurance needs to be prorated into every mile that you drive it, too. If you drive it 1,000 miles a month and insurance costs you $80 a month, you’re spending $0.08 per mile to cover insurance.

That’s $0.48 per mile, right there.

If your trip to the post office and the store requires four miles of driving, then you’re burning $1.92 in that short trip.

Now, what about that bicycle? The bicycle I own cost less than $100 and requires no upkeep other than air, which I get for free at the gas station. I’ve ridden on it for thousands of miles by now, which gets me down well below $0.10 per mile in cost.

Riding that trip, for me, would cost about $0.30 on my bike, give or take.

Clearly, riding a bike for simple errands is less expensive than using a vehicle. However, the vehicle is going to be quicker than the bicycle. How much quicker depends heavily on where you’re at. For example, I can get to many destinations within my town almost as quickly on a bicycle as I can in a car because I can take shortcuts through parks, utilize bike lanes, and so on. This varies a lot depending on your community.

There’s also the fact that bicycle riding is far better for your health than driving a car. The exercise you get while riding a bike has health benefits in the long term and energy benefits in the short term, a value which is again hard to calculate but leans toward the bicycle strongly.

Is riding a bike around town going to save you a mint? No, but it will save you a little and it’ll improve your health at the same time without adding too much time to your day.

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39 thoughts on “Saving Pennies or Dollars? Riding a Bicycle

  1. A retired mechanic once told me the best way to predict how long your car would last is number of times you start the engine, not number of miles on the odometer. Cold starts damage your engine the most. So using a bicycle for short trips could help extend the life of your car.

  2. Using a bike, calculating everything as you did for the car, you need to consider more than the initial cost & free air: add in tire replacements and a tire repair kit, brake repair/maintenance, a helmet, bike shoes if you use cleated pedals, oil for the chain, bike gloves if you wear them, bike shorts or a padded seat, & probably some medical cost for spills or the possible more major accident.

  3. I’m not sure if pro-rating the car insurance per mile is appropriate here. You pay the same regardless of how much you drive; if it was sitting in the garage or if you were driving cross-country, the insurance rate would not change.

    Personally, I find it inconvenient to ride my bike for errands. I “bundle” my errands so I get them done during my lunch break at work or on one weekend afternoon. I like to ride my bike for pleasure, though.

  4. Insurance needs to be prorated into every mile that you drive it? Really? I pay the same monthly premium whether I go on a road trip across the country (3000 miles in a month) or just run a couple of short errands a week (300 miles in a month). Unless I were to cut way down to a low-use discounted policy, my insurance is a fixed cost, not something that increases or decreases by the mile.

  5. @CNM — you beat me to it, I was thinking the same thing. At the margin, which is what we are talking about here, your insurance cost won’t change if you ride your bike to the PO once in a while.

    If you stop driving to work, and ride your bike instead, your rating class would likely change (“pleasure” rather than “commuting”) and your premium would change. In that case, accounting for insurance would be appropriate.

  6. Some car insurance policies do take into account your routine driving habits (how long a commute, whether you use it to commute, as #5 said, average distance traveled in a given period, etc.).

  7. Bikes need upkeep other than air.

    Nor do I find running errands on one convenient (I don’t have panniers). If it’s close, I walk. Or bundle them and drive as already mentioned.

  8. I would say if you can run an errand on a bicycle do it. Not so much for the savings because if you can’t replace the truck totally with a bicycle, you will still have to pay the maintenance, insurance, and purchase costs.

    But think about this, no matter what else you do today, you rode your bicycle 4 miles. You had some time alone, outdoors, to think, to improve your health. You did something for yourself, you did something for the fun of it.

    To me, this is worth it, even if it costs the same and takes twice as long.

  9. I always get a little frustrated that people assume everyone can ride bikes everywhere. My town is very unfriendly to bicyclists. Narrow curvy roads, lots of hills, no sidewalks or bike lanes. To get to the grocery store (only a few miles away), I’d have to go down (or at least cross) two busy roads with speed limits of over 40 mph (no crosswalks either). I’d love to ride my bike to run errands, but am scared of being hit.

    I wish people would take this into account more when suggesting that everyone should ride bikes.

  10. You must also count the savings from externalities. Car use has more costs that just the price of gas to the consumer, and those costs do get passed to you as well in the form of energy costs, taxes for water treatment, etc. Of course fuel use (and the cost of road construction, etc) is heavily subsidized as well, but it’s too simplistic to consider just the cost of fuel and maintenance and insurance.

  11. While I agree that riding a bike is more affordable than driving a car, I’m not sure you’ve done a thorough analysis on the bike. There are maintenance costs, etc. You should actually have a tune-up done annually, which runs just shy of $100 (give or take.) Not to mention any gear you might acquire if you “get into” biking. Some places require licensing for bikes as well.

    And how would sunk costs play into this scenario? If the truck and bike are already paid off, it’s not really costing you anything more to drive them besides the money that’s now coming out of your pocket.

    Just some random thoughts.

  12. Like others have pointed out, I disagree with pro-rating insurance. It doesn’t not factor into a trip to the grocery store or not. It only matters if you are planning to sell the car and go car-free.

    Also, I am all for making cities more bike-friendly but personally I am not willing to bike down a busy road, too scary for me with all the idiots out there!

  13. One more point: I think it more likely that a pickup truck will be driven for 300,000 miles than 100,000 miles, which brings the new cost per mile down to $.05. Maybe that’s not a big deal, but could be taken into consideration. I wish I could ride a bike more, but where I live it is not safe. (Nevermind I have my infant with me most of the time).

  14. @#11 “And how would sunk costs play into this scenario? If the truck and bike are already paid off, it’s not really costing you anything more to drive them besides the money that’s now coming out of your pocket.”

    But assuming that the life of the vehicle is finite, every mile you drive brings you one mile closer to the “death” of the vehicle, which brings a replacement cost. So, a cost per mile approach makes sense here.

  15. My two cents: A lot of people are afraid of getting hit, but my experience (I used to commute up and down Broad Street, in Philly, before I decided that I was better off risking a mugging than getting hit by a car) is that most cars are careful–AS LONG AS THEY CAN SEE YOU. So my mom’s warning, to stick as close to the curb as possible, clearly does not apply. Even so, it’s best to use common sense and avoid large, multilane roads whenever possible. I eventually ended up taking a parallel side street to work, but like I said, it wasn’t without its heebie-jeebie moments.

    Also, if you’re going to bike to run errands, consider getting a bike rack. Where I live (the Netherlands) these metal triangles are standard. People carry everything on them (even each other), using bungees, or just holding onto the thing while it sits on their bike. I would highly recommend getting bike panniers, as well. These can be costly (a good set, made with fabric, will set you back about €50 here) but they make life SO MUCH EASIER.

  16. Having been both a bike commuter and car-free at different times, I find that replacing any individual trip with a bike doesn’t save much money. What really saves money is replacing one car with a bike. When my household is a one-car household with transportation supplemented by heavy bike use, we save a lot on insurance, maintenance, cost of a car, and gas.

    When we had no car and biked everywhere, we incurred car rental costs. Renting a car for a weekend once a month was cheaper than owning a car, though. Naturally this is not realistic for a lot of people. But, I biked on busy 45-mph roads with no shoulder every workday for four years, and never had a car come close to hitting me. Part of that is good fortune, but a lot of it is learning how to occupy space in traffic, communicate with drivers, and use other safety skills. I did take one spill when my tire got caught in a railroad track, but it required no medical attention. I replaced my helmet afterwards just in case, at a cost of $50.

    Even daily cycle commuting does not require much gear. Panniers are a one-time cost. Helmets are extremely important, but you only need one. Lights and their batteries are necessary – even if you never intend to bike after dark, you don’t want to get caught without lights.

    Everything else they will try to sell you at a bike shop is unnecessary for getting around town. Street shoes and toe baskets are much more practical for a transportation bike than specialty shoes and pedals. You don’t need special bike clothes. If you’re biking to get around town and run errands, and are not a cute young woman, you will probably feel kinda stupid walking through grocery stores in spandex bike shorts anyway. If anything, you’ll need a pair or two of shorts or tights to wear under your street clothes for comfort; but if you bike all the time, your body gets used to it and you don’t need special clothing to prevent chafing, etc.

    In other countries you will often see people cycling for transportation. It looks pretty different from Americans who use bikes for sport or as a toy. Too many Americans learn about cycling from shops and magazines that are trying to sell them stuff they don’t need!

  17. JS’s comment (#1) is right. Starting a car and running it for a short trip is hard on it mechanically. Engines have operating temperatures, and until it reaches it, it’s more susceptible to wear and damage. That goes for exhaust systems and transmissions too.

    Also, until the car is warmed up, it uses significantly more fuel. Depending on the outside temperature, it could use up to twice as much until it reaches operating temp.

    A vehicle that averages 20mpg mostly on the hwy is definitely NOT getting 20mpg driving 2 miles to the store in winter. Then again, biking may not even be an option in winter…

  18. Some bike shops (and REI) offer classes on what I’m going to call defensive riding.

    You are a vehicle. Don’t ride on the sidewalk and stop at stopsigns.

  19. I’m with #9 Dana – we’re also in a bike-unfriendly town (not only the traffic & road conditions, but unfenced dogs and few places to secure the bike, among other things). So if you’re looking at adding bike use to your life, be sure to check that out before you buy a bike or sell the car!

  20. I agree with the others that you’re underestimating bike maintenance costs. I ride my bike twice a day five days a week for 20 minutes each time. I need tune ups at about £50 twice a year. Even if I do it myself I need to buy degreaser and lube, new brake pads, a new chain every couple of years, etc.

    The biggest savings comes if you can drop the car altogether. Our household (two parents and a 3-year-old) survives just fine with no car. In a city with a half-decent transit system it is not that hard to survive on foot, bike, and public transit. We either get our groceries delivered or carry them home with us on the bus or on the bike.

  21. I wrote my own post with a trackback to here… but apparently Trent doesn’t enable trackbacks! Feel free to read it on my site… but in essence I completely disagree. Riding a bike can save THOUSANDS of dollars if the bike is in place for a car, or if you are able to avoid tolls/parking fees by using a bike.

  22. Having groceries delivered is a fantastic way to make a car-free life easier. I fondly remember those days . . . especially when I was living in Saskatchewan and it was -40 in the middle of the winter. The $5 delivery fee was worth every single penny for a person who had to walk home with groceries otherwise.

  23. No one rides a bicycle for “thousands of miles” without incurring expenses. My experience is tires, inner tubes, brakes, bearings/races, derailleurs, sprockets and chains seldom last thousands of miles. And if you pedal with sustained effort in order to maintain decent speeds, everything fails faster. Including the frame.

  24. I have had the same bike since 1993. I have biked across the US twice on it (total spent on one trip: $600, and that includes lodging though that trip was in ’93), and then had it as my only vehicle for 7 years. Learning to maintain your own bike is much easier and cheaper than learning to do so with a car. I needed a new chain once in all those years, my wheels have never gone out of true, I’ve changed brake pads about 3 times, replaced the pedals once, replaced handlebars twice, once for comfort, once from breakage. Most of the maintenance has been lube and patching tires, then replacing tubes after I’ve decided I have too many patches on them. I am pretty sure the total I have spent on maintaining my bike is less than what we spent to replace the clutch on our old car.

    I agree that some of these comparisons (such as insurance) Trent is making would make more sense if you were talking about replacing your bike with a car. One little thing that is cheaper on a bike- you don’t pay for parking if you go downtown. A bigger thing, if you do actual bike touring: much much easier to find lodging when you can fit your bike into your tent, or just pull it off road into the woods.

  25. There are so many different ways to analyze this. I have a super cheap mechanic for my car, and it needs brakes. I could get em done for less than $100. I also need insurance, I could get it for about $600/year, but only if I paid up front. I don’t have $700 right now, so I became a bike commuter at the start of the month.

    I have a work vehicle, so I just do my errands in that, which makes this super easy for me. I will buy some panniers eventually. I also have friends to work on my bike for me, so repairs will probably cost me parts and a six-pack.

    I recently compared the cost of riding my bike vs driving my car vs taking transit. If I’m a bit disingenuous, transit costs more than my car. But biking most places, and paying for the bus only a couple times a week, plus one cab ride, is much cheaper. Since I can almost walk anywhere as fast as the bus gets there, and can definitely bike (even though I’m still walking up the hills) faster, this is such an easy decision for me.

    In writing this comment, I realized that having work done cheaply is a big part of my cost savings, with any vehicle. I recommend cultivating some kind of support network if at all possible.

  26. I commute to work by bike every day, and it saves a (very small:-) fortune. I bike app. 50 km a day. If I had to pay for public transportation the cost would range from 2×12$ a day for one way tickets to ~200$ for a monthly pass. If I drove a car, I would expect the cost pr. kilometer to be about 0.30$ (leased car, gas, wear and tear) AND I would probably go more like 70 km to avoid congested areas.
    The cost of a bike can be anywhere from 200$ to many thousands, but I usually aim at the area of 1200$ – too cheap to be a target for thievery, but a quality that gives me pleasure to use on a daily basis.
    With the usage pattern I have, I put 6-7000 km on the bike a year. This results in upkeep in the range of 200 – 300$ a year (changing the gear parts, chain, tires, tubes, brakepads..) Some done myself, some done by professionals.
    This means that comparing to the cheapest public transportation, I’ve paid my bike by the 6 or 7 month mark, and for every year after that, I save ~2000$. This is a worthwhile saving for me. Especially considering how much more efficient it is to double my transport time as exercise time as well. The bikeride is app. 1:10 min, whereas the train and busride is an hour sharp. Add in the extra shower and change at each end, and we are approaching 1:25 x 2. So there is a considerable time investment, but not a huge one. Less than an hour pr. day.

    I never ran the number for driving a car, since I don’t have a drivers license, but with the above assumptions we are talking double the savings of public transportation.

    The risk of injury is higher of course with that many kilometers on highly trafficked roads and with varying visibility levels. This might be included in the cost-benefit analysis, but to me the exercise and freedom cancels out the risk.

  27. A final problem we have in our area regarding riding bicycles is the climate and air quality. We have 2-3 months each summer with temps in the high 90′s to upwards of 100 every afternoon/early evening – usually combined with air quality alerts. Winters are foggy and drizzly. Not optimum riding weather if you’re using it for a work commute, particularly if you have any distance to ride. I can’t tote a hair dryer & dry clothes every day, and am not willing to wear myself out & sweat through my work outfits in an overheated afternoon.

  28. Biking as an option depends on distance, terrain, weather, what you’re carrying/bringing back, and time.

    The latter – time – is something I think is often overlooked. Our time isn’t free, and saving a dollar or two on gas might not be worth the potentially significant extra time required by biking. I think it’s better to look at biking from a health/excercise standpoint, as long as the roads/paths are safe.

  29. I find it interesting that so many people are frowning on biking for running errands because of weather or time.

    I walk to do many errands (can’t bike – two small children and roads around here aren’t safe enough for a trailer). I do it in almost any weather except pouring down rain (misty or foggy – just wear a jacket!), and I mainly do it because it’s way more interesting and feels more “productive” than an hour spent on a treadmill at the gym.

    Not that long ago, our culture biked and walked almost everywhere because cars were pretty expensive. As a community, we were in much better shape (not going to argue the health aspect, since those days were also before many vaccines, antibiotics, and modern surgery).

    Do you really save all that much time by driving for errands (I “bundle” my walking errands, too) if you also add in the time you don’t need to spend at the gym?

  30. I must add a comment in response to the weather/climate comments. The 7 years that I had a bike as my only vehicle were in Eugene, Oregon, with 9 months of daily rain every year. I biked everywhere all year, as did (and do) many people who live there. The right gear keeps you dry- good rain pants, good helmet liner, good rain jacket, and definitely good fenders for your bike so you don’t get the muddy stripe up your back.

    The summers are very hot and dry in Eugene- biking was much cooler than walking, and I never needed a change of clothes for my job- which was retail, dealing with customers, etc.

    I think if you don’t want to bike, you shouldn’t, but if you WANT to bike and the weather intimidates you, it may be worth researching the gear. I happened to love biking and also happened to be broke during that time, so I made it work, and it worked great. These days, I like to walk more than bike, but I also drive- it’s easier with 2 kids, and I’m older and lazier than I used to be…

  31. I just wanted to concur with elyn’s comment (#26): my husband has been an avid biker for the entire time I’ve known him (10+ years), and was even before that. He’s had to replace a bike once, when it was stolen. Otherwise, he just repairs and/or upgrades what needs it. For all three of our bikes, I’d estimate that he’s spent around $1500 over the last decade. Not an inconsiderable amount, but not astronomical, either. In my experience, the cost of bike maintenance is negligible.

  32. Biking’s really popular in the Netherlands, it saves a lot of money, the Dutch are a thrifty nation. Biking instead of driving cuts down on air polution and traffic and parking congestion. Biking’s a good idea if your town’s fairly flat and crime free. I have a big basket on the front of my bike and a few bungy cords in case something needs to be carried. A bike’s pretty handy around town.

  33. I wonder about those air quality problems…maybe if everyone rode their bikes rather than driving, we wouldn’t *have* air quality problems. Something to consider (though it’ll never happen.)

  34. @Elyn–I’m so totally envious of you!

    I have impaired balance due to old child abuse, and would love a multi-speed cargo trike for stability. The problem? Theft risks. Anyone have any ideas on how to secure one without garaging it? Atlanta’s close enough that thieves could make a few quick benjamins on one just by cutting cables.

    Best solution for city dwellers–purchase extended-cab truck cash for hauling family and heavy loads, insure for liability only, and use bike for everything else. Failing that, rideshare or carpool and use bike for primary transport. I’m a small-town woman, would use bike in town and find an unemployed/underemployed person who needs gas money for longer errands.

  35. Little Pitcher- I used to live in a tiny apartment with no garage and I kept my bike in it with me- I think my bike is very pretty, so I didn’t mind looking at it right there inside. Sometimes, I would put vases of flowers in the crate for fun. I even fit a very large cargo bike inside once for a few weeks (I think cargo bikes are ridiculously cool to look at as well). Currently, we keep our bikes in a locking bike shed. Pretty easy to find them online, this one cost us about $300 at the big chain hardware store, and it fits neatly under our back porch. Fits two adult bikes with room to spare.

    I have a friend who is completely paralyzed on one side- he gets around on a recumbent trike pretty handily. I can find out where he got it if you are interested.

  36. Whether biking to do errands or commute full-time is right for an individual clearly involves a careful individualized analysis. For purposes of this article, the focus is errands within 4 miles and a vehicle that gets 20mpg. The answer is obvious – ride your bike! My issue is that this articles centers around the cost analysis. It’s not just a financial decision. 20 miles per gallon is pathetic at best. Do what’s better for the environment and better for you. Ride a bike!!!

  37. 35 years ago, before something in my lower back went out and my knees quit working as designer intended, I enjoyed riding a bicycle.

    The bicycle is a marvel of simplicity in engineering. A device that then could be bought new for $250 multiplied your walking speed by a factor of 4. Compare that to a car that might then cost $5,000 new that could multiply your average speed by a factor 12 on the same local commute. By the way, that is generous. My average speed on my current local commute according to my car’s computer is actually 29 mph.

    As far as cost per mile, well I use to enjoy a 70 mile round trip ride to a neighboring town and back on a nice Saturday. I discovered the cost in fried pies and sodas required to keep my bicycle on the road on this journey was almost exactly the same as the cost of gasoline for the same trip.

    Back in those days, when the weather allowed, I also commuted 7 miles (one way) to work. Really, bicycle commuting isn’t practical given this country’s notion of personal hygiene without a shower and a locker containing work clothes at your place of employment. At one place I worked back in the day, a genius (really) from an Eastern block country, considered riding a bicycle the normal preferred method of commuting. The powers that be kept him locked up in a backroom where the customers would not be offended by his body odor.

    If you are young enough and healthy enough to enjoy a bicycle, go for it. Not as a proof of your frugality, but as a joy. One of my many regrets is not riding across the country or riding the length of US 1 on my bicycle when my heart, knees, and back made it a real possibility.

    By the way, you bicycle riders out there, stop at stop signs (I didn’t) and stay out of the middle of the road, especially on narrow country roads with blind curves and short choppy hills. You will live longer.

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