In a groundbreaking survey conducted by Zipcar, it has been revealed that the soaring expenses associated with car ownership have led a significant number of Americans to consider living without a personal vehicle. The survey pointed out that the combination of expensive monthly car payments and rising insurance costs has become a major deterrent for many, with 35% of respondents planning to adopt a car-free lifestyle by the end of this decade.
Furthermore, the findings indicated that an astonishing 44% of respondents were already acquainted with someone who had chosen to relinquish car ownership without facing any adverse consequences. The trend seemed particularly strong among Gen Xers and millennials, with 45% and 51% respectively expressing a higher level of enthusiasm for embracing a car-free life compared to their counterparts from older generations.
According to Angelo Adams, the Head of Zipcar, the conventional American notion of owning a car has undergone a transformative shift. Car owners are feeling the mounting stress associated with ownership and are now seeking more affordable and convenient transportation alternatives readily available at their fingertips. With the ever-increasing costs of owning a car that spends most of its time idle and parked, people are questioning the rationality behind such a substantial financial investment.
The automobile industry has experienced a dramatic shift over the last decade, with higher-end luxury vehicles dominating the market due to a low-interest rate environment and extended financing loan terms, making economy cars less accessible. The result has been a 33% surge in new car prices over the past five years, with the average transaction price reaching a staggering $47,713 in March, as reported by Edmunds. Alongside escalating car prices, consumers have had to contend with the burden of more expensive financing terms.
In the first quarter of 2023, the average monthly payment for new vehicles reached $730, compared to $656 a year earlier, according to another report by Edmunds. For used cars, the average monthly payment slightly increased from $542 to $551 during the same period. Such exorbitant costs have put immense strain on the average American’s budget, making car ownership increasingly unaffordable.
Zipcar has actively advocated car sharing as a viable solution to avoid the burdensome costs of car ownership. For those unwilling to part ways with their personal vehicles, the company suggests several techniques to reduce the overall expenses associated with owning a car:
H2: Shop Around for Better Insurance Rates
Recent surveys, including one by Policygenius, have highlighted that 33% of drivers consider switching car insurance companies to cope with rising insurance rates. Shopping for the same auto coverage strategy and limits with multiple insurance carriers can significantly increase the chances of finding a more budget-friendly deal.
H2: Seek Pre-Approved Financing
Amidst a high-interest-rate environment, searching for pre-approved financing can lead to securing a better deal on car loans. Consumers are encouraged to diligently search for pre-approved financing just as they would when shopping for an actual vehicle to ensure favorable terms.
In conclusion, the skyrocketing costs of car ownership are compelling more and more Americans to explore the possibility of living without a personal vehicle. With carless living gaining traction as a viable alternative, people are turning to car sharing and other cost-cutting measures to alleviate the financial strain. As the automotive industry continues to evolve, finding creative solutions to address the affordability issue becomes increasingly crucial for sustaining a car-dependent society.
Download our app MadbuMax on the Apple App Store for the latest news and financial tools. Interested in getting your finances in order do not forget to check Dr. Paul Etienne’s best-seller book on personal finance. To access more resources, tools, and services please click here. Also, do not forget to follow Dr. Etienne on IG or Twitter.
