One thing I haven’t done in the 21st Century is finance a car. My Ford Aerostar van was already paid off when I hauled two kids, a dog, a cat, and a U-Haul trailer from California to Maine in 1999, and moved back to the state where I grew up. There was one more vehicle: a piece of junk I bought from my son when he went to college and for which I handed him $600 in cash. For my six hundred bucks I got about three months of driving. That was in 2006; I haven’t owned a car since.
Thus I have no personal experience with what it costs to buy and keep a car today. I suffered a bit of vicarious sticker shock recently when I picked up the AAA Explorer magazine and read an article about car loans.
Apparently, there’s something called the 20/4/10 rule. Make a 20% down payment, pay off the loan in four years, and keep the cost of payments and other car expenses below 10% of your monthly household income.
According to the article, the average price of a new vehicle is now north of $47,000. Part of this is because Americans love to drive big pickup trucks and SUVs even as they complain about the cost of the gas they guzzle. Financing a $47,000 vehicle by the 20/4/10 guidelines would mean a down payment of $9,400 and a monthly car payment of $846 at 3.85% interest for 48 months.*
Yikes. Several years ago, AAA estimated the average annual cost of owning a car at $9,000 per year. It has surely gone up since then, as these numbers would seem to indicate. Giving up car ownership is like earning a $10,000 raise. So why aren’t more people doing it?
“I couldn’t live without my car.” You will hear variations on this theme whenever you present the idea that car ownership is a choice, not a requirement. “How will I shop for groceries, or take my dog to the vet, or get my guitars and amps from home to gig and home again? How will I get to work? What if one of my kids gets sick, or my aging parents have an emergency?” All these and more are valid concerns for individual car owners who have bought into a car-dependent life. It’s not a question of money; it’s a feeling that there are no alternatives.
But when you peel back the assumptions underlying our mass car culture, you begin to realize that it doesn’t have to be this way. We don’t all need cars all the time. Why can’t cars be time-shared, like condominiums? Why do veterinarians have to set up practice on the outskirts of town? Why can’t employers incentivize carpooling and the use of public transportation? Why can’t we use the gas tax to finance more buses and bus drivers? Why can’t we build walkable, interconnected communities instead of strip malls, suburbs, and parking lots?
Maine is rural, and rural residents balk at paying taxes for public transportation they don’t use. But city taxpayers finance roads so that rural commuters can drive thirty or more miles to work.
Yes, Maine needs more public transportation. But the political problem is that the majority of Maine voters don’t use it. That’s why it’s important to use what’s already here, even if it’s inadequate. Think of your car as a last, not first, choice. Go to that Sea Dogs game by Concord Coach bus and skip the parking. Use their once-a-day coastal bus service to attend one of the many summer events in the Rockland area. Take the Community Connector to work, especially if your employer incentivizes it, as mine does.
There is a huge groundswell of people who want to throw off the yoke of car payments and car ownership. But many of them feel trapped by the infrastructure we’ve created that caters to the automobile rather than the human beings who, often reluctantly, drive them.
By establishing that people will use public transportation even when it’s difficult, we can demonstrate the demand that will make it easier in the future.
* – All figures are from Drive Smart: The Perils of Protracted Loans, by Peter Bohr, AAA Explorer, page 10, July/August/September 2022 issue.