Buying a bike as a savings strategy
August 25th 2017
At the end of August each year, the Bureau of Labor Statistics issues a long report about consumer expenditures. It’s not an exciting read, but it’s a really good indictor of what’s going on in our lives and what to expect. The report isn’t ready yet for last year, but this was 2015:
Leading the pack, of course, was housing, which captured 1/3 of our income (and rising).
Healthcare, insurance and pensions took another 26% (and rising).
Transportation accounted for 17% of our expenses, and food another 12%. By the time it’s all over, just 12% of your money is yours to spend on the rest of your life–unless you think strategically.
Is it possible to refocus the Big Four expenses to give yourself more discretionary income?
Biking as transportation.
Beyond the initial purchase, a car is an expensive ongoing investment in fuel, oil changes, alignments, and consumables like batteries, filters, tires, brake pads. And that’s all without a budget-busting major repair!
A reliable bike, on the other hand, requires no fuel (except what you eat), and has consumables (tires, brake pads) that cost 5% as much. If you currently have to pay for parking, the savings are even better.
As cities are rolling out necessary infrastructure and road-safe policies (like Vision Zero), more Americans are biking to work. According to the American League of Bicyclists, the number of American commuters rose 62% between 2000 and 2014. The top 10 cities for biking to work are New York, Los Angeles, Portland, Chicago, San Francisco, Seattle, Washington D.C., Philadelphia, Minneapolis, and San Diego.
If you’re in one of these cities, biking is a better option than ever. If not, and your city isn’t yet investing in safe streets, you’ll need to get to commuting incrementally.
A full-size bike in the trunk allows you to drive on dangerous roads, park outside the limits of city pay parking, and then ride in the rest of the way, banking your monthly parking costs. Your bike can pay for itself out of transportation expenses, without ever touching discretionary funding.
Biking as healthcare.
It takes only two to four hours of exercise to achieve a general improvement in your health. Cycling is:
- Easy: It’s low impact on the joints and muscles and requiring low levels of skill, and you can even coast down hills.
- A good workout: It works out all your muscles, our cardio system, your lungs, and is as intense as you want it to be
- Efficient: Commute, and you’ll get a workout while you’re doing something else. There’s no better time use than that!
- Fun: You’re outdoors, exploring, meeting neighbors, seeing new places…part of your community and the world around you. So you’ll do it more often.
Those all sound good. But is there any real evidence that biking can turn around a health issue?
- Weight loss. British research shows that a half-hour bike ride every day–just a 15-minute commute each way–will burn over ten pounds of fat over a year.
- Cardiovascular disease. A Danish study conducted over 14 years with 30,000 people aged 20 to 93 years found that regular cycling protected people from heart disease.
- Diabetes. Large-scale research in Finland found that people who cycled for more than 30 minutes per day had a 40 per cent lower risk of developing diabetes.
- Arthritis. Riding a bike is excellent exercise if you have osteoarthritis, because it is a low-impact exercise that places little stress on joints.
- Depression. Mental health conditions such as depression, stress and anxiety can be reduced by regular bike riding.
Put it together, and you’ve got enjoyable regular exercise that helps fight off the conditions and ailments that raise your healthcare expenses. Even if you can’t reduce your overall healthcare costs, increased health and reduced prescriptions can help slow the rise of this area of expenses, leaving you with more discretionary income at the end of the year.
A reliable, convenient bike doesn’t have to come out of discretionary spending. You just need to know what problem you’re trying to solve and think strategically.
So what problem are you trying to solve?