True Cost of Commuting Calculator

How to use the calculator

Drawing inspiration from Mr. Money Mustache's timeless article titled "The True Cost of Commuting", this guide explains how the calculator works, breaks down the math behind the results, and empowers you to make informed decisions about your work, home, and lifestyle choices.

1. Enter Your Round Trip Distance

Input the total miles you travel both to and from work each day. For example, if you live 15 miles from work, enter 30 miles for your round trip.

2. Enter Your Daily Commute Time

Based on recent Census Bureau data from 2023, the average one-way commute time in the United States is 26.8 minutes. I set the calculator default to 53 minutes that would be pretty close to the average. Enter your actual total daily commute time in hours and minutes for more accurate projections.

3. Cost per Mile

The calculator uses $0.58 per mile as the default, based on U.S. Department of Energy data. This figure estimates the total cost of vehicle ownership and takes into consideration:

• Vehicle depreciation
• Maintenance and repairs
• Insurance
• Registration and taxes

4. Hourly Wage

The default value of $29.81 reflects the average hourly wage in the United States, according to the U.S. Bureau of Labor Statistics. Enter your actual hourly wage for more accurate results. If you're salaried, divide your annual salary by 2,080 (40 hours × 52 weeks) to get your hourly rate.

5. Workdays per Week

Enter how many days per week you commute to work. The default is 5 days, but adjust this if you have a different schedule or a flex work situation.

6. Gas Price and Fuel Economy

• Enter your local gas price per gallon.
• The default fuel economy is 25.4 MPG based on 2021 data.
• Adjust these values based on your vehicle's actual performance.

7. Monthly Car Payment

• The average monthly payment for a new vehicle is an eye-popping $737 per month.
• If you're vehicle is paid off, you can enter $0 for this input. And congrats on the payoff!

When you click the "Calculate True Cost of Commuting" button, the calculator takes your input values (like distance, time, wage, and vehicle costs) and runs them through a series of formulas to determine both the financial impact (including direct driving costs, gas costs, and the opportunity cost of your time) and time investment of your commute. Give it a try now!

Understanding the formulas

Annual Direct Cost = (Daily Round Trip Miles × Days per Week × 52 weeks) × Cost per Mile
            

Annual Time Cost = (Daily Commute Hours × Days per Week × 52 weeks) × Hourly Wage
            

Annual Gas Cost = (Annual Miles / MPG) × Gas Price per Gallon
            

The Rule of 172

I emailed Pete Adeney about this tool for feedback and guess what? Pete got back to me the same day (so cool!) and suggested I add the Rule of 172 to these calculations so people can see the difference in their wealth over time. Here's a direct quote from Pete's email:

"For example, when I talk about the effect of monthly savings over a decade, I project it out using a "Rule of 172″ calculation. With no compounding it would just be 12 x 10 = 120 times the monthly expense over the course of ten years, but with the effects of compounding it becomes an even larger 172 times."

Here's the exact formula I applied to the calculator for you home gamers:

Future Value = Principal × (1 + r)^t

Where:
- Principal = Your total annual commuting cost
- r = 7% (0.07) annual return
- t = Time in years (10 or 20 years)
- ^ means "to the power of"
    

About this calculator

Back in the late 2000s and early 2010s, blogs were sort of like the Wild West of ideas. During this time period, I always loved stumbling upon a writer you'd never heard of and going down the rabbit hole of their archives, devouring post after post. This might be like finding a new favorite author, Youtuber or maybe someone on X today.

For me, one of those writers was Pete Adeney, better known as Mr. Money Mustache. Pete isn't your typical finance blogger. He's a retired software engineer who became a beacon for the FIRE movement or Financial Independence, Retire Early.

After retiring in his 30s, Pete began sharing his unconventional insights about money on his blog. His posts weren't about dollar cost averaging into a stock index, but how to live a rich life on far less than society says you need.

One of Pete' ideas that hit home for me was the concept of commute time. Funny enough, I was living that exact reality when I discovered the post: driving about an hour each way to a cubicle job, five days a week.

The more MMM I read, the more I realized how much of my time was being wasted. I knew I had to make a change. And I'm happy to report that I eventually did find a new job with more pay and a better work / life balance.

Inspired by Pete's teachings, I built the True Cost of Commuting to Work Calculator. I hope this tool will help you see what I saw back then: that those miles and minutes add up to something bigger than we realize. It's a way to put Pete's insights into practice and maybe even take one step closer to designing a life that works for you: financially, personally, and purposefully.