How Going Carless Can Save You Money

Quick Answer

Going carless can save money by eliminating expenses such as car payments, gas and auto insurance. However, you must weigh the savings against the inconvenience—and possible expense—that going carless might cause.

Portrait of a woman wearing protective helmet riding e-bike to work.

Owning a car drives up your cost of living. In 2022, the average yearly cost to own and operate a new vehicle totaled $10,728, AAA estimated. That figure includes expenses such as fuel, car insurance and maintenance.

Going carless certainly can put a lot of money back in your bank account—perhaps thousands of dollars a year—but it can also cause difficulties in other areas. Before ditching your car, be sure to weigh how this would affect your life. Would it really be worth it to go carless?

What Is Going Carless?

Going carless doesn't mean you must give up driving entirely or let your driver's license expire. Instead, it simply means you no longer own a car and no longer must carve out part of your budget to operate one.

However, going carless does mean you'll need to find other ways to get around, such as:

  • Public transportation, including buses, subways and trains
  • Ridesharing services like Uber and Lyft
  • Taxi services
  • Walking
  • Biking
  • Carpooling
  • Rental cars

Before you decide to give up your ride, ask yourself these six questions.

  1. How much will the transportation alternatives cost? You want to be sure you won't be spending more money to go carless, instead of less money.
  2. How would you get around in case of an emergency, such as a last-minute trip to the hospital to treat a broken arm? Is there a relative, friend or neighbor who could give you a ride? How close are public transportation options?
  3. Are you able to drive someone else's car? If you frequently borrow a spouse's, partner's or friend's car, they should add your name to their auto insurance policy to make sure you're covered when you're behind the wheel. As extra protection, you might want to buy a non-owner insurance policy. This policy offers liability coverage for property damage or bodily injury that you cause when you're driving someone else's car.
  4. Can you rely on a friend, relative or neighbor for transportation to places like a doctor's office or grocery store? If you live somewhere without easy access to public transportation, you'll still need to be able to get places on time.
  5. Are you old enough to rent a car? Some rental car companies place age limits on rentals. For instance, you must be at least 20 years old to rent a car at most Hertz locations in the U.S., and 21 years old at most Enterprise locations.
  6. Are you planning to have or adopt kids in the near future? If so, being without a car might make it tougher to carry out tasks like dropping off your child at their daycare center or school.

How Can Going Carless Impact Your Finances?

You may be aware of how much you're paying each month on your auto loan or lease. But do you have a good idea of how much money you're spending on things such as fuel, insurance and maintenance?

The chart below, based on AAA, Experian and Federal Highway Administration data for 2022, shows average yearly costs for owning a new car.

Annual Costs of Car Ownership
Average Annual Cost in 2022 Basis for Calculation
Car payment $8,400 Based on an average monthly loan payment of $700 for a new car in the third quarter of 2022
Depreciation $3,656 loss in value per year Based on difference between new-vehicle purchase price and estimated trade-in value at the end of five years and 75,000 miles
Fuel $2,424 Based on average fuel cost of 17.99 cents per mile and average yearly mileage of 13,476
Car insurance $1,588 Based on full coverage for a personal vehicle of a driver who is under 65, has more than six years of driving experience, has no accidents and lives in a city or suburb
Maintenance, repairs and tires $1,304 Based on average annual cost of 9.68 cents per mile and average yearly mileage of 13,476
License, registration and taxes $675 Based on the average national cost

Alternatives to a Carless Lifestyle

So you realize you don't want to give up your car, yet you still want to cut costs. Here are seven tips for saving money on transportation.

  1. Look into switching car insurance companies. By shopping around for coverage, you might be able to slash your car insurance premium. The Insurance Information Institute recommends obtaining quotes from at least three insurers to compare costs, coverage options and other factors.
  2. Consider pay-per-mile car insurance. A pay-per-mile policy charges a base amount in addition to a fee for the number of miles you rack up each month. This might be an attractive option if you work from home.
  3. Drive carefully. By being careful on the road, you can avoid speeding tickets, crashes and other incidents that can raise your car insurance premium. In addition, responsible driving (such as not speeding) can save money on gas.
  4. Maintain your car. Regular maintenance, such as scheduled oil changes, can prevent major (and expensive) problems down the road.
  5. Do maintenance yourself. If you're handy with tools, you might take care of oil changes, tire rotations and other routine maintenance at home rather than paying a mechanic for this work.
  6. Buy a more fuel-efficient car. A vehicle that gets 30 MPG will cost $848 less in fuel each year than one that gets 20 MPG, according to That's assuming 15,000 miles of driving annually and a fuel cost of $3.39 per gallon. Over a period of five years, those savings would add up to $4,238. Be sure to weigh that savings against any higher costs associated with the more fuel-efficient car.
  7. Use public transportation. Even if you have a car, you might leave it at home and sometimes opt for public transportation, such as buses or trains, to reduce expenses.

The Bottom Line

Going carless can trim your expenses, enabling you to redirect money to retirement savings, debt reduction and other purposes. But if you don't want to go carless, you can still decrease transportation costs. For instance, you can use Experian's free tool to compare car insurance quotes and perhaps score a lower rate.