100 Ways to Improve 1% – Part 5
100 Ways to Improve 1% – Part 5
This post will be another part of my series “100 Ways to Improve 1%”.
If you are on the FIRE journey, then chances are you have already modified the “big-ticket” items when it comes to your expenses, this is looking at exploring some more fine-tuning touches you can make to your everyday life.
This list has been derived from the people at ChooseFI
Below are the links to the other sections that are part of this series:
Part 1 – Exercise and Personal Growth
Part 2 – Debt
Part 3 – Emergency Fund Savings
Part 4 – Home Expenses
Part 5 – Transportation Expenses
Part 6 – Groceries and Dining Out
Part 7 – Shopping and Services
Part 8 – Internet, Phone and Entertainment
Part 9 – Travel and Sightseeing
Part 10 – Earning Extra Money
Part 11 – Investing and Retirement Planning
Part 12 – Job and Career
Part 5 – Transportation Expenses
30) Buy Used
The average new car will depreciate by approximately 20% in it’s first year on the road, and then another 10% for the following four years. This is terrible news for new car owners, but it is great news if you are willing to buy a used car that is approximately 5 years old, where the initial high depreciation has already been realised, but you are still buying a relatively new car which will have the required modern conveniences.
31) Sell Secondary Cars that Aren’t Frequently Used
This is probably a time when I need to take my own advice, I have a secondary car which sits in the driveway 90% of the time. The cost of keeping it, including paying the required registration and insurance is more than the cost of hiring a car every time I needed a second car.
32) Pick Cars With High Fuel Efficiency
Typically, you will want to get the smallest car you can that is still big enough to fit everything you need. Also, it is important to look at the efficiency of the engine, the fuel efficiency of cars can vary considerably from as low as 5L/100km up to 15L/100km. The additional cost of fuel definitely adds up over time.
33) Avoid Speeding
The speed that you drive has a direct effect on your fuel efficiency. The slower you drive on the highway, the more fuel efficient your car will be. Cars with small engine capacity, typically use significantly more fuel at higher speeds as the engine is working a lot harder, but even with larger engines, the faster you go, the more fuel you use. Not to mention, if you do not speed, you do not have to worry about getting a traffic fine!
34) Reduce Your Car’s Idle Time
When your car’s engine is running while sitting stationary, you are still burning fuel, but you are not travelling anywhere. If you are not actually travelling anywhere and you plan on remaining idle for a decent period of time, consider shutting the engine off.
35) Take Less Shopping Trips Throughout the Week
This is something I have been particularly bad at in the past, because the shops are close by I do not mind ducking down every second day to pick up a couple of items. Not only is this terrible for fuel efficiency, but it puts me in the shops more often when I am more likely to buy more than what I need.
Create a menu at the beginning of the week and develop a comprehensive list so you only need to visit the shops at most once a week (hopefully).
36) Shop Around For Insurance Rates Every Year
If you just automatically renew the insurance on your car, then you are paying a lazy tax. Insurance companies are betting on you not looking around and just doing the easiest thing and paying the insurance, assuming that it is the best value. A lot of the time it isn’t. There are multiple comparison sites available to compare insurance rates, allowing you to pick the cheapest one. Rarely do you get any benefit as a consumer for staying loyal.
37) Avoid Fines and Demerit Points
Not only are you able to avoid the actual fine, which is a cost saving in itself, but if you do not lose any demerit points a lot of things can become cheaper. Renewing your license becomes half price, Insurance and Registration also becomes cheaper. I cannot speak for every state, but in NSW they definitely reward drivers who do not lose demerit points.
38) Consider Walking or Cycling if Possible
Walking or cycling not only provides great exercise, but will reduce your transportation costs significantly. Every time you start your car you are adding to the overall wear and tear, as well as fuel consumption. If you can limit that as much as possible you will end up saving money.
39) Increase Your Excess With Your Insurance To Keep Premiums Down
Having a large excess can be intimidating, but if you have a substantial emergency fund then it should not be a concern. Most of the time you will never use your insurance, so chances are you will end up better off if you increase your excess amount and in turn create lower premiums.
40) Use Public Transport if Possible
I probably should have put this one first, because it really is important. Not only is it better for the environment, but it will also typically save you money in the long run if you are able to catch public transport instead of driving yourself. Not only that, but if you drive in traffic regularly, then riding public transport can be a lot less stressful and give you time to catch up on your favourite financial podcast.
41) Consider if You Even Need To Own A Car
With places like GoGet now offering relatively easy car hire services, if you have good public transport in your area, you may be able to live without a car at all. If you only use a car a couple times a month, then hiring a car on something like GoGet might be more cost effective than owning your own car. This could particularly be beneficial if you live somewhere without your own garage and no on street parking.