Commute Cost

The real annual cost of a commute

A commute has two prices. The one people quote is fuel; the one that decides quality of life is time. Both are worth putting a number on before accepting a job that is forty minutes further away.

How it works

• Multiplies the one-way distance by two, by days per week, and by working weeks per year.
• Converts that distance into fuel used and cost, then adds parking and public transport.
• Converts the time spent into hours per year, which is usually the more startling figure.

km per year = one-way × 2 × days per week × working weeks
fuel cost   = km × (L/100km) ÷ 100 × price per litre
total       = fuel + parking + transit

hours per year = minutes each way × 2 ÷ 60 × days × weeks

use ~46 working weeks, not 52 — holidays and leave are not commutes

Worked example

An 18 km each-way drive, five days a week, 7.2 L/100 km, fuel at 6.50, parking 400 a month, 45 minutes each way.

1. km per year = 18 × 2 × 5 × 46 = 8,280
2. fuel = 8,280 × 7.2 ÷ 100 = 596.2 L → 3,875
3. parking = 400 × 12 = 4,800
4. total = 8,675 a year, or 37.72 per working day
5. time = 45 × 2 ÷ 60 × 5 × 46 = 345 hours

8,675 a year in direct cost — and 345 hours, which is 8.6 working weeks spent in a car. A job offering 5,000 more but adding twenty minutes each way is not obviously the better job.

Reading the result

• Use working weeks, not calendar weeks. Assuming 52 overstates the distance by about 13% once annual leave and public holidays are removed. Most commute calculators get this wrong by default.
• Fuel is the smaller half for many drivers. Parking, tolls and the depreciation of 8,000 extra kilometres a year frequently exceed the fuel bill. If you are comparing jobs, price the whole thing.
• Convert the hours into something you recognise. 345 hours is more than eight working weeks, or roughly an hour and a half of every working day that belongs to neither you nor your employer.
• Compare against the salary difference in net terms. An extra 5,000 gross is perhaps 3,400 net; against 8,675 of commuting cost the arithmetic often reverses the obvious answer.

Common questions

Should I count the time as money?

Not directly — you are not paid for it, so it is not lost income. But it is worth converting to hours and asking what you would pay to get those 345 hours back. Many people find the honest answer is more than the salary difference that prompted the move.

How do I compare driving against public transport?

Put both on the same annual basis, including everything. Driving carries fuel, parking, tolls and wear; transit carries the season ticket and usually a longer door-to-door time. The cheaper option on paper is often the slower one, and the comparison should show both numbers rather than picking a winner.