How to Save on Commuting Costs

Businesswomen are walking to work together through the city. They are talking and one is holding a coffee while the other is holding a smartphone.

As inflation continues to squeeze consumer spending power and more companies return to in-person work, commuters are feeling the strain of rising transportation costs. With the average annual cost of owning and operating a new vehicle reaching $10,728 in 2022, according to AAA, driving back and forth to work can take a major bite out of your budget. You can bring commuting costs down by seeking out a more fuel-efficient car, carpooling with coworkers or taking advantage of public transportation, among other options.

1. Use a More Fuel-Efficient Vehicle

If your household has more than one vehicle, use the one with the best gas mileage for your family's longest commute. Small differences in gas mileage can really add up: A vehicle that gets 30 MPG can save you $918 in gas costs annually compared to one that gets 20 MPG, according to (That calculation assumes fuel costs $3.67 per gallon and you drive 15,000 miles per year.)

Considering a new car? Make it a fuel-efficient electric or hybrid vehicle. Although federal tax incentives are more limited than they used to be, tax credits of up to $7,500 for a new vehicle and up to $4,000 for a used one are still available. Be sure to weigh potential fuel savings and tax benefits against the car's purchase price, ownership cost and any home modifications necessary to charge your new vehicle.

2. Join a Carpool

Carpooling with a neighbor, friend or family member who has a similar destination and work schedule not only helps cut your commuting costs, but also reduces the stress of fighting traffic. (Find a five-person carpool, and you'll only have to drive one day a week.) Some large employers offer employee van pools or shuttles. Check your local transit agency's website; it may have information on carpooling options and resources to help you find carpool buddies.

3. Take Public Transportation

Trading a car for public transportation can save the average household up to $10,000 per year, according to advocacy group In addition to saving money, taking public transportation gives you time to read, nap or catch up on work during your commute. Buying monthly or annual passes for public transportation is generally cheaper than paying by the day. Also check to see if you qualify for special rates, such as senior or student discounts.

4. Walk, Bike or Ride a Scooter

Depending on the distance between home and work, your fitness level and how much time you have, biking, walking or riding an electric scooter to work could not only save money, but also give you a workout. Walking to work costs the least, but also takes the longest. Electric bikes and scooters let you cover more ground without breaking a sweat, potentially making a longer commute feasible. Just make sure to wear appropriate safety gear and brush up on local laws before hitting the road. For instance, you'll want to research if riding a scooter on the sidewalk is allowed in your area.

5. Take Advantage of Employer Stipends, Reimbursements or Tax Savings

Your employer may provide stipends or reimbursements for parking fees, biking to work or taking public transportation. Some companies have programs allowing you to put aside pretax money to use for qualified parking and transit costs. In 2023, you can save up to $300 per month for parking and up to $300 for transit passes or commuting in qualifying vehicles in one of these employer-sponsored plans.

6. Find Fuel Savings

Following some simple habits can help you lower fuel costs. You'll get better gas mileage if you keep your car well-maintained, properly inflate the tires and avoid braking or accelerating suddenly. Stop-and-go traffic eats up fuel; if your commute is crowded, negotiating flexible hours can help you avoid traffic and save gas.

When it's time to fuel up, use gas apps such as Gas Guru and Gas Buddy to find the lowest prices near you. Signing up for gas station or supermarket rewards programs can earn you significant discounts on fuel. You can also earn cash back, points and other rewards by using a gas rewards card to pay at the pump.

The Bottom Line

Some money-saving commuting methods can also help you save on car insurance. For example, insurance companies often discount auto insurance premiums if you drive fewer than 10,000 or 12,000 miles annually; pay-per-mile auto insurance is another option. New cars or alternative-fuel cars may earn discounts, too.

Many states allow insurance companies to check your credit-based insurance scores, which are derived from similar data as your regular credit score. Reviewing your credit score before shopping for insurance can give you insights into what insurers might see. Working to improve your credit score could help lower your car insurance costs and see even more savings on your daily commute.