How Expensive Is Uber Vs. Owning A Car?
3-minute readSeptember 22, 2021
For most families, transportation is one of the highest line items in the budget. Yes, you need a way to commute to and from work, plus run errands, but does that really mean you need to own a vehicle?
Given that there are rideshare services available throughout the U.S., it makes sense that you can ditch your car and opt to get around using Uber or Lyft instead. But is that really a good idea? What are the cost breakdowns of Uber versus owning a car, and are the potential savings worth it?
Exact numbers will vary depending on the type of car you want to own, as well as other costs. Let’s break down of costs of owning a car versus the costs of rideshare services.
Is Using Uber Cheaper Than Owning A Car?
Before looking at specific numbers, let’s take a look at what you’ll need to pay when you own a car:
- Insurance – Costs will vary, but the most expensive state averages $1,824 per year.
- Car maintenance – This will depend on the make and age of your vehicle, but AAA estimates car owners will spend around $1,186 each year.
- Gas – You could pay an average of $7,929 to fuel your vehicle, assuming you drive at least 10,000 miles per year.
- Parking – This is an occasional cost.
According to the same AAA report, owning a car can set you back $10,663 on average.
Compare this to the average Uber price, coming in at $0.80 per mile. Assuming you’ll travel 10,000 miles per year (a common average for commuters), you’ll pay about $8,000 a year, making Uber slightly cheaper. However, you could pay higher prices depending on the time of the day. Keep in mind that Uber also charges a booking fee, which averages $2.80 each time.
For a more accurate estimate of how much you’ll pay each time, use Uber’s price calculator.
Is Lyft Cheaper Than Owning A Car?
Let’s use the above calculations for car ownership to see whether it’s cheaper to use Lyft. Both Uber and Lyft use similar pricing calculations – it fluctuates depending on the time of day, location, the type of vehicle and minimum costs.
On average, Lyft charges around $1 per mile, not accounting for minimum costs. In other words, it’s slightly cheaper than owning a vehicle. That being said, prices can be lower in your area so use Lyft’s fare estimator to see how much it could cost you.
Cost Of Owning A Car Versus Using Rideshare Services
What the above calculations show is that it’s hard to nail down a definitive price when comparing owning a car versus rideshare services. That’s because there are many variables at play, including the type of vehicle you own, where you live and when you need to commute.
There are other costs that can’t be calculated in dollars – your time. When you own your own car, you’re spending time maintaining that vehicle. This includes repairs, waiting at the mechanic’s and cleaning your vehicle. If you use rideshare services, you don’t need to worry about doing any of that. Think about the time you could save and what else you could be doing.
Rideshare services can also be significantly cheaper if you own a more expensive vehicle that doesn’t have great gas mileage. If you own a median-priced vehicle (like most small SUVs and sedans), then the prices differences can be blurred.
Another factor you need to consider is how much you drive. If you live in a busy area and drive less than 10,000 miles per year, rideshare services tend to be cheaper. For car owners who live in a highly dense area, you’re also saving money on parking costs.
So for those who drive more than 10,000 miles each year, it might cost less to own a car. According the previously mentioned AAA report, the average cost per mile goes down to 61.88 cents when you drive 15,000 miles and even lower at 53.31 cents.
Let’s not forget other lifestyle factors that will affect costs. For families with young children, you’re probably better off owning your own car – it’s not that convenient to have to lug a car seat everywhere. Uber has an option where you can request a car with a car seat, but you’ll need to pay $10 for the privilege and it’s only available in New York City for the time being.
Will You Ditch Your Car?
Ridesharing won’t work for everyone since it depends on financial costs and other considerations. For example, families might not feel safe using Lyft or Uber and would rather own a car instead.
There’s nothing wrong with doing an experiment to see what will work for your budget. Consider parking your car in the garage for a few weeks to see if you like ridesharing. Worse case, go back to driving your own car.
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