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How to sell your car and make £1 million

Last week, after nearly 30 years of car ownership, I sold my car. Not replaced, sold. Many people I have told have been rather surprised by this, as if I have broken some unwritten social contract.

So why did I sell it? The decision was partly inspired by a book I found on the internet last year: Why You’re Better Off Not Owning A Car (see below) and partly because I usually cycle to work and have used my car so rarely over the last couple of years that the running (or rather the not running) costs were becoming excessive for such low mileage.

So what are the real costs of running a car? Leaving aside all the environmental, social and health costs, here are the hard numbers for my car (a 2002 BMW 330ci convertible):

  • Date bought: April 2003
  • Date sold: June 2010
  • Total miles driven: 42,000

There are lots of things I haven’t included, such as:

  • parking
  • cleaning
  • cleaning materials
  • parking fines
  • speeding fines
  • car phone adapter/Bluetooth
  • accident repair excesses
  • parts for DIY maintenance
  • washer fluid
  • maps
  • air fresheners
  • tools
  • manuals
  • ipod and other in-car adapters
  • de-icer and scrapers
  • tolls
  • bike carriers
  • sun shades
  • garage space used up
  • time spent on the above, and looking for parking spaces
  • etc. etc. etc.

Of course, on the other side of the balance sheet, there are costs such as public transport, bikes, car hire to factor in.

Obviously there is a huge convenience factor in having a car but, when you look into it, I think you will realise that for most people, life is not as impossible as it may seem without a car (especially if you have other family members with cars and if most of your journeys are within cycle-able distance, as they are for me).

I recommend you read the Why You’re Better Off Not Owning A Car book and make up your own mind. If you’d like help working out the real cost of your car, let me know.

Here’s the clincher. Over my (nearly) 30 years of car ownership, if I had invested the £530 a month saving by not having a car and got a 10% a year return, how much would that investment be worth now?

Answer: £1,200,000!

3 Responses to “How to sell your car and make £1 million”

  1. Steve Mills says:

    Wow! Maybe I should give up my car, but I don’t think I can cut out driving totally but cutting down on mileage would be a start”.

  2. Nigel Baker says:

    Yes and I’m going to sell the house and live in a tent! Time to write a “How to” book so you can afford to choose how you want to live.

  3. Tony Armstrong says:

    A very informative post. Most people do not consider the true cost of running their cars only tending to looking at the cost of fuel. Your example clearly shows that depreciation at £0.55/mile is by far the biggest cost. Further, mileage is often by far the biggest driver of depreciation (until really high annual mileages are covered).
    Many town dwellers could dispense with a car, especially in the now common two car families. I would love to cycle more but, for many of us, a car is the only solution to a complex business life

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