Introduction
Car-sharing services have been around for years, but they’re getting a lot more attention now that Millennials are taking over and driving less. The primary benefit of car sharing is that it allows you to rent vehicles by the hour or day, which is particularly helpful for people who don’t want to own cars or who want access to a vehicle when traveling. But with all the different companies and models out there, how do you know which one is right for your situation? In this article we’ll look at how much renting vs buying costs per year as well as what other factors might affect those numbers.
The Cost of Owning a Car
The average cost of owning a car is $9,000 per year. This includes all costs associated with buying and maintaining a vehicle, including:
- The purchase price of the vehicle itself
- Insurance premiums (including liability coverage)
- Gasoline for commuting and other driving needs (assuming 15,000 miles driven per year)
- Parking fees if you use public transportation instead of parking on your own property or at work/school
The average cost of this package will vary depending on where you live, but it’s generally between $5k-$10k per year–and that’s just for one person! If you have multiple drivers in your household who commute regularly by car then those numbers could easily double or triple during their tenure as motorists.
The Cost of Using Car-Sharing Services
The cost of using a car-sharing service depends on the type of membership you choose. Most services offer both pay-as-you-go and monthly plans, with each offering different hourly rates. The hourly rate is usually higher than the cost of owning a car, but it can be reduced by using the service less frequently.
In addition to membership fees, some companies charge an annual fee or additional surcharges for things like gas and insurance (if they’re not covered by your membership). For example: Zipcar charges $20 per year plus an additional $0.15 per mile driven; Car2Go charges $35 per month plus $0.25 cents per minute or flat rate per hour depending on which option you choose; DriveNow charges €29 ($34) plus €0-$1 ($1-$1) depending on usage
Why Millennials Choose Car Sharing
Millennials are the most likely generation to use a car-sharing service, and they’re also more likely than older generations to choose a car-sharing service over owning a car or taking public transportation.
The reasons behind this trend are varied: Millennials may feel that it’s generally cheaper, faster, and more convenient than other options. They may also be interested in sustainability or urban planning issues (for example, by choosing not to own cars).
While it’s more expensive to use a car-sharing service, it still can be cost-effective.
While it’s more expensive to use a car-sharing service, it still can be cost-effective.
When you own a car, you are responsible for all of its costs–the initial purchase price as well as ongoing expenses like insurance and maintenance. However, when using a car-sharing service like Zipcar or Turo (formerly Relay Rides), many of these expenses are covered by the provider. For example:
- You don’t have to pay for gas because they provide fuel cards that can be used at any gas station in the United States or Canada; this alone saves money on every trip made with their vehicles.*
- They provide insurance coverage through their partnerships with leading insurers such as Allstate and State Farm Insurance Companies.* This gives members peace of mind knowing that they’re protected against liability claims should anything happen while driving one of these cars.*
- You don’t have to worry about maintenance costs because Zipcar provides regular inspections at no cost to members.* Your only responsibility is keeping track of how many miles are driven per month so they know when it needs servicing again (which also helps them keep track).
Conclusion
With all the information we’ve gathered, it’s clear that millennials are a cost-conscious bunch. They want to save money and they want their transportation options to be affordable, which is why car sharing could be so appealing for them. We also saw that there are some tradeoffs when using this service versus owning your own vehicle–mainly in terms of time spent driving or parking as well as fees paid per mile driven. However, these costs would still be lower than those associated with buying and maintaining a car yourself (not to mention finding parking spots).