Should you move closer to work?It’s not always a great idea to buy a home closer to work – especially if you’re the type that jumps jobs every few years. That being said, with today’s gas prices and average commute times, one can’t help but wonder how much time, money and aggravation you’d save by working just a little closer to home.
According to the CAA’s assessment of driving costs, commuting in a four-door sedan will cost you approximately 14.7 cents per kilometre – although, this number varies according to where you live in the country and how much you drive per year. So let’s say your daily commute is 40 kilometres round trip – that’s going to cost you approximately $1,580 per year in fuel, maintenance and tire costs. And that’s in addition to fixed costs like insurance, depreciation, car payments and licence and registration which will land you somewhere around $6,293 if you’re driving that same four-door sedan. If you decrease that commute down to 20 kilometres round trip, you’re cutting those costs in half – and likely seeing a decrease in your fixed costs as well. After all, you’ll probably pay less in insurance if you’re driving your car less, and see less wear and tear as well.
To put that savings into perspective, if you were to tack on the $790 on your mortgage that you’d save in shaving down your commute time, you’d pay off your mortgage years sooner and save a lot in interest charges. For a $200,000 mortgage with a 4% interest rate and 25 year amortization, for example, you’d shave off three years and save close to $13,000 in interest payments. Now there’s an argument for working closer to home!    |
