How much is your commute costing you?
In my career, I have spent years at a traveling job, other years working in Dallas but with significant commutes, and now I work at home.
If you work a regular job, you probably have a commute. You might not think about how much it costs you. Most obvious is the driving. Add up things like...
1. Mileage- you could try to add up gas and car repairs, and car depreciate from the mileage, but easiest is to go with the IRS Standard Mileage Reimbursement Rate of .50 per mile (2010 rate). So if you drive 25 miles one-way, that is 50 miles a day times 22 working days a month times .50 per mile = $550.00 per month. Ouch!!!
2. Car payment- could you get by without a second car, or with a cheaper car if you worked from home? If yes, add in the difference of your car payment, or if you have your car paid off, what the car payment would be if you were paying it off.
3. Tolls- don't forget them- they can add up. For my last job I calculated that I was paying $5.50 a day in tolls. You probably have a tolltag so you don't even think about it, but add it up.
Then after driving, add up your time...
4. Time in car - include those bad-weather days and traffic delays
5. Extra time getting ready- OK so I admit it...working from home I don't shave everyday. Figure 25-50% less time getting ready each day.
6. Time on lunch break- I used to go out a lot with people or by myself for lunch, and now I usually have a quick lunch with my family and then get back to work. For me probably saves 30 mins a day.
For all of your time, figure it at an hourly rate. If your time is worth $40/hour, and you would save 10 hours a week, then your cost is $400/week or about $1700/month (I always calculate 1 month equal to 4.25 weeks, which is close when you consider holidays).
Then add in other expenses...
7. Eating out- both on your job at lunch, Starbucks or food on your way to work, and eating out for dinner more because you don't have time to cook anything at home (or because "I deserve it")
8. Extras- gifts for your boss and co-workers, extra things you do related to your job that you don't get paid for, etc.
Once you add all of that up, do one more thing...because that amount is cash, it is after-tax. Add the tax rate to it for your tax bracket, and you'll get a clearer picture of what your commute is costing you.
Financially that is...what about all the time away from your family? What about the frustrations and emotional stress of a corporate job?
When you add it all up, your commute might be costing you more than you think!
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