Before I really get into this months article I wanted to share a quick and easy little idea to save money and reduce energy use. I ran across this tidbit in a book called “Living Homes” by Thomas J. Elpel. It’s about cutting your refrigeration costs, at least for those of us who live in colder climates. Here it is, take some plastic containers such as 2-liter soda bottles or milk jugs and fill them up with water, leaving some space at the top. Cap it off and during the winter months put it outside to freeze. The extra space in the jugs is to allow room for expansion as the water freezes. This expansion is also why I wouldn’t recommend glass containers. Once it’s frozen, or at least cooler than your fridge, put it in your fridge. As it thaws simply set it back outside to refreeze. That’s it!
The colder block of ice will help cool the interior of your refrigerator and keep it from running as much. If your fridge isn’t running then it isn’t using electricity so your power bill goes down. I started doing this a couple weeks ago and I swear I haven’t heard my refrigerator run since! It also helps to keep your fridge full. This provides thermal mass, which helps retain temperatures. So for those of you in the warmer climates, who don’t have all this nifty frigid air outside, just filling unused spaces with bottles of water will help the efficiency of your refrigerator. When you open the door all the cold air may rush out but the thermal mass of the cold water won’t. Since I’ve been sharing this tip with all sorts of people I meet I thought I’d share it with Art Calendar readers too. Ok, on to this month’s article.
I’ve written previously about how I track all expenses each month, tally them up in their various categories, and evaluate the fulfillment I’ve receive from each expense. When I’m looking to reduce my living costs I go to this data. What are the expensive categories returning only marginal fulfillment? Tackling the biggest ones likely involves the greatest alterations in lifestyle, but they can also yield the most savings.
Before doing this it helps to spend some time seriously considering what you want your lifestyle to be. I desire to live a creative life, discovering and bringing about beauty. I also desire a slower pace to things where I have time to contemplate and enjoy what I’m doing rather than being rushed to get on to the next thing. Friends and community are important to me. The avoidance of dwelling on negativity is a huge issue for me when sculpting my lifestyle. When my thoughts get into a rut stewing over ugliness it can spoil my whole day.
Remember this whole process is about sculpting the life YOU desire. Knowing what is important to you is necessary when making major decisions. Otherwise it’s likely some advertiser out there will be eager to tell you, and sell you, what they claim will make you happy. Often the goal is really more about selling you things than providing fulfillment.
When I look at my monthly expense categories I see that a major one is always transportation. I expect this is fairly universal, so I’ll write about some of the things I do to control these costs AND increase my joy of life. I’ll start with my car. Where I live, and I suspect most of you as well, a car is necessary especially for artists who need to haul paintings, sculpture, and basic materials around. Sadly, public transportation is almost nonexistent where I live.
I purchased my current car in November of 2003. It’s a 92 Ford Escort. When my previous vehicle up and died I was without a car for about two weeks. It took me so long to find a new one because I was being quite particular to select a vehicle that matched with my lifestyle goals. Your goals and needs may be different but I’ll describe what influenced my choice.
It had to have front wheel drive. I live in Michigan, known for having icy and snowy road several months out of the year. Extensive experience has shown me that rear wheel drive handles VERY poorly in snowy weather. It’s not a terribly fulfilling experience to constantly get stuck in a mere two inches of snow, be towed out of a ditch, or, worse yet, have an accident. Thankfully I haven’t experienced the accident part, but having a car I can control on an icy road is a good first step to avoiding one.
The car also had to have a hatch back with a fold down back seat. I’ve found that this configuration works very well for me as an artist hauling around stuff. While it’s not a huge vehicle, I can still easily transport large, long, or awkward things. I can extend long boards up into the passenger side. I can fit my bicycle inside with little effort. I can haul a full, 10-foot sheet of copper by rolling it up a bit. I can pack the back with all the stuff I need to do a demonstration of my metalworking techniques. If need be I can even lie out and sleep in the back. I personally think the hatch back configuration is great for artists. My back seat is constantly in the folded down position. I just wouldn’t consider a vehicle with a standard trunk. It doesn’t work for my uses.
Of course the big criteria for my vehicle selection is cost. Similar to many other issues I’m not just looking at initial costs. I want the overall operating cost to be as minimal as possible. I find this easiest to evaluate by looking at how much it costs per mile to run. This involves looking at several different factors.
I never buy a car new from the dealership. Thus far I’ve only purchased old, end of their life, vehicles. I’ve had eight different cars and all but one have left me for the junkyard. I run them until the end. People tell me old cars end up costing you more because of all the repairs, and I do know my repair shop quite well. However, from what I’ve seen even new cars require repairs, often more costly ones. Parts on older vehicles can often be readily found really cheap at the junkyard.
I once borrowed money to buy a car. It was a two-year loan. The car died after the first year and I had the pleasure of paying for it another year. I don’t intend to ever do that again. At the time I was in a very tight financial situation and borrowing was really the only option. Having since gotten my finances in order and always keeping that 6-month buffer in savings, I only pay cash for a car. This saves me all the money I would otherwise pay in interest on the loan. It also avoids the galling situation of paying for something you no longer have. Someone once told me, and I really don’t know if it’s true or not, that car companies make more profit from financing automobile loans than they do off the cost of the automobile. I suppose I went on enough about debt last month so I won’t harp on this too much here. Just remember, despite what car dealership ads might lead you to believe, having a monthly car payment is not a standard, unavoidable expense like the phone or electric bill.
Whether you accept that the Peak Oil Crises is for real or simply the latest fabrication of doomsayers, it’s hard to ignore that the cost of gasoline has risen dramatically in the past couple years. Personally I expect it to keep rising. When I filled up the other week at $2 a gallon I was thinking, “Wow that’s cheap!” Then I considered how differently that $2 a gallon would have seemed just 2 years ago. In fact, the costs of gasoline have been rising so fast the IRS has increased the deduction rate for your business use of vehicle miles after September 1, 2005. Will it become the norm that mileage deduction rates change throughout the year?
In seeing what was happening with gas prices, an extremely important factor I had when selecting my current vehicle was its fuel efficiency. A car getting decent miles per gallon will be saving you money throughout its life. In fact, the way things are going it will save you increasing amounts of money! My Escort gets between 30 and 33 MPG, up from the 20 or so MPG my previous vehicles had been getting. I almost had a Geo Metro getting 49 MPG, but it sold just before I could buy it. Though I generally buy a car and run it until it’s done, if I see a high MPG hatchback like a Metro for a reasonable price I’d consider swapping it for my Escort. As an added bonus, tires on these small cars are inexpensive too.
When car shopping I also only look at domestic vehicles. This isn’t for any particularly patriotic reason. Many foreign cars are made quite well, require fewer repairs, and run forever. However, since I buy cars at the end of their lives I do plan on frequent repairs, and domestic parts are much cheaper.
When it comes to insuring my vehicle I keep in mind what I’ve driving. It’s usually a $1000 beater. In Michigan liability insurance is required, as I imagine it is in all other states, but collision coverage is not. To me it doesn’t make a lot of sense to pay for collision coverage on a thousand dollar car. Heck, the deductible would probably be at least half that! The way I see it I provide my own collision coverage with that wondrously useful 6-month savings buffer. Should my car get wrecked I’d have no trouble fixing or replacing it. Isn’t that what you’re buying with insurance, the peace of mind that you’ll get through such situations?
These are some of the factors I consider when trying to find a vehicle with low total costs. Ok, lets look at some concrete numbers. Since I track all my expenses and know how many miles I’ve put on my car I can determine the actual cost per mile of my current vehicle. Now this figure will vary some over the life of the car as the initial purchase cost is spread out over more miles, the gas prices change, etc. Since I bought the car I’ve logged on 22,410 miles. The entire cost of operating this vehicle for those miles has been $6392.41. This figure includes the initial purchase price of $1000, plus all the gas, repairs, insurance, registration, etc. Everything is in there. If I divide the total cost by the total miles I get my cost per mile. 6392.41 ¸ 22,410 = 0.285. So my 92 Escort costs me 28.5 cents for every mile I drive. I just calculated this while writing this article and honestly it’s higher than I thought it would be. My last vehicle was 17.8 cents per mile, but then gas prices were lower and it had fewer costly repairs.
So how much does it cost to own and operate your vehicle? Only you can figure that out, but here are some things to consider. Most of my vehicles have gotten up to 150,000 miles before it’s not worth repairing any longer. So I’ll use 150,000 as an estimated life of a car. If you bought a car new from the dealership for $20,000 and ran it for it’s life then the base price of the car would cost 13.3 cents per mile. If you bought it for $20,000 and sold it for $10,000 after running it for 50,000 miles this figure would be 20 cents per mile. For comparison I bought mine for $1000 and expect to easily put 25,000 miles on it. That base price cost is 4 cents per mile. If my car gets to 150,000, which seems entirely likely, then I would have driven 34,960 of those miles yielding me a base price of 2.8 cents per mile. This is why I feel old cars are the better value in the long run. I have more repairs but if I bought the car new and drove all 150,000 miles I’d still have the same repairs plus a higher base cost per mile.
I don’t know what the average car costs to run per mile, but I’m guessing it will be close to what the IRS allows for a standard deduction. For the first part of this year that number is 40.5 cents a mile, for the later part it will be 48.5 cents. If this is truly average then getting a getting a cheap, fuel efficient, older car could be saving you 20 cents every mile you run it. I also LOVE figuring the “business use of vehicle” expense on my taxes since it’s one area where I legally get a deduction much greater than my actual costs.
As with other things, knowing the real costs of car use can make you consider the worth of a trip. For me a quick jaunt to the nearby town, 4 miles round trip, costs $1.14. With the current federal deduction rate it is $1.94. My frequently traveled 54-mile round trip to the city and back is a whopping $15.39 every time. At 48.5 cents a mile it’s $26.19! I used to foolishly make this trip all the time to work an $8 an hour job for about 6 hours. I’m going to let you do the math on that one to see why I never had any money. The figure is just to embarrassing to print! (Remember that $8 per hour was before taxes.)
At the beginning of this article I wrote about considering your desired lifestyle, and making major decisions to support this. Here’s where this comes into play. My art business is doing fairly well. I’ve got some major show lined up; sales and general interest in my work are increasing. However, I certainly don’t have money falling out of my pockets. If I weren’t living lean my art would still not support me. I’d love to buy a new hybrid electric car and support the latest, environmentally conscious technology. That does align with my values. Yet to own such a vehicle I would have to get a regular job, likely in that major city with a 54-mile daily round trip. The fulfillment I would get from such a car, and the lifestyle changes I’d need to buy it, pales in comparison to what I receive from being an artist, spending my days creating works of beauty. Plus I save even more gas by working at home. So I chose to drive rusty, beat down, ugly old cars. They support a fulfilling life for me.
I’ve been writing about automobiles throughout this, but they are not the only form of transportation. In fact, my car is not vehicle I use the most, it’s just the most expensive. When I considered what I desired in life I realized a car is often not the best choice for me. Most of my trips are 4 to 11 miles long going to one of the nearby towns. I would make these almost daily and the costs showed up in my monthly expense evaluation. This made me consider why I was always going into town. I realized it was more about taking a break from my work, getting out of the isolation of my studio and being around other people for a bit. Now if I were trying to budget my money I’d deny my need for breaks and sense of community. I’d cut out all extra trips to town and feel deprived as a result.
This isn’t about budgeting though. It’s about sculpting your life. So I don’t deny myself the trips, but I saw there was a better solution. It’s a bicycle. This has become my favorite form of transportation. The pace is much slower. I’m not passing by the scenery. I’m traveling in it. I can smell the air, study the trees and flowers. I get to moo back to the cows, chatter with the squirrels, and run with the bunnies. I’m interested in edible wild plants so I scope out the neighborhood to see what’s growing while I ride. Sometimes even the bike is too fast. If I see something particularly intriguing I stop, get off the bike, and check it out. These slower bike trips nourish me as an artist, provide more satisfying breaks from my studio work, and give me needed exercise. I get to enjoy where I am in the moment rather than speeding on to a future destination.
While I didn’t expect this when I began riding my bike I’ve found that biking also builds community. I see and interact with neighbors out walking their dogs or riding their bikes. It also seems to form a topic of conversation with the various merchants I go to, especially since I even ride in the winter.
I don’t just ride for pleasure. I also use the bike for functional trips such as grocery shopping, going to the bank, etc. I’ve found a set of good pannier packs makes my bicycle a working vehicle. You can fit an incredible amount into those with careful packing. The next thing I want is a trailer for my bike, like one of those used for bringing small children around. With a trailer I could bike to the laundry mat or bring larger packages of artwork to my shipper.
As an added bonus the bicycle is cheaper to operate and maintain. It doesn’t use any gas, and my biggest repair bill has been 20 bucks. Every time I go to the nearby town by bike I save $1.14. A trip to the next closest town saves $3.13, and both trips are far more pleasurable to me by bike.
Is transportation a major expense in your life? Have you seriously considered what other options are available to you and how these options fit your desired life? Is an older, smaller, fuel-efficient car a better option? Could you carpool? Are you fortunate enough to have functional public transportation? Can you walk, bike, roller blade, etc.? As I said in the beginning, tackling the largest expenses in your life can mean the greatest lifestyle alterations, but those alterations could be helping you fulfill your greatest desires.