Cost of Living: Hear Ren’s #1 tip for saving on transport

Bryce: [00:00:28] Welcome to Get Started Investing a podcast where we attempt to answer the most common money and investing questions from the community. If you are joining us for the first time, a huge welcome. We do strongly recommend that you scroll up and start at episode one. Now we are licensed, but we are not aware of your personal circumstances. All information on this show is for education and entertainment purposes, and any advice is general advice. With that said, let's crack on. My name is Bryce and as always, I'm joined by the equity buddy Wren. How are you? 

Alec: [00:00:57] I'm very good. Bryce. Excited for this episode. This is the second part of our five part series on Cost of Living. You mentioned at the top there that we are answering some of the most common money questions, and this is the big one. At a moment like this, when it feels like costs are rising across the board. The question on everyone's lips is what can I do to manage those costs? Yes, and we don't have a great answer. Unfortunately, that isn't a great or easy answer at the moment, but there are a lot of little things that we can do that add up. 

Bryce: [00:01:31] All right, Ren. Well, we've got a question that's come in from Alan from the Equity Mates community. Let's take a listen. 

EM Community: [00:01:36] Hey, equity mates, It's Alan here from the Virgo Beach on the sunny coast. Been listening since day one, since the early days of your podcast journey. And I just want to throw a question out there. And with these tough times, cost of living ever increasing, I wanted to get your take on what is a good way to reduce my transport costs. Thanks very much. Keep up the good work. 

Bryce: [00:01:59] Joe. Nice first one, Alan. It's great to hear from day one fans, Day one listeners out there. Thanks for sticking with us from 2017. If there are any other Day one fans out there, let us know. Jump into the Facebook community group at today's episode. As Alan sort of alluded to, it's all about transport. Two way that we can reduce our transport costs across the board. But before we jump into that exciting news that we announced last week and that Wren is the pre-order of our second. 

Alec: [00:02:26] Book, it's called Don't Stress, Just Invest. And we really wanted to set out the most straightforward and easiest way to do enough when it comes to investing. We step through how you can automate your investments, why you should automate them into and what that will mean for you in the future. So it is available for pre-order now. Wherever books are sold. We'll include a couple of links in the show notes and it is live and released on the 22nd of August. So very exciting times and hopefully it helps you on your investing journey. 

Bryce: [00:03:03] Love it. You can check it out. We'll have a link in the show notes. Go and grab yourself a copy before it sells out. So today, Transport. Last week we spoke about furnishings and household goods, and this week we're looking at transport. This is one of the big buckets as part of the Consumer Price Index. If this is the first episode you're joining us, the Consumer Price Index is a basket of goods that is measured and the change in price is measured every three months to give us a sense of inflation. For a bit more detail on that, have a listen to our previous episode where we break it down a little bit. We should firstly start by looking at what goes into the transport category. So we've got new and used vehicles and we know during COVID used vehicles went through the roof, fuel and lubricants, vehicle maintenance and repairs. So you car services, public transport fares, your insurance premiums on cars and vehicles, your registration fees, your road tolls, tyres, and also any vehicle leasing and financing costs.

Alec: [00:04:06] And over the past 12 months, this has unsurprisingly moved higher, up 4.3% between March 20, 22 and March 2023. On first glance, that feels low, I reckon, just based on rising fuel costs and stuff like that. Although actually fuel costs probably rose more between 21 and 22. But some of the bigger drivers motor vehicles up 5.9%, spare parts and accessories up 14 and a half per cent, maintenance and repair of motor vehicles up five and a half percent. 

Bryce: [00:04:41] Right. Well, let's have a look at how this falls in our budgets, because I'm sure it's slightly different. You no longer have a car. 

Alec: [00:04:51] Yeah. 

Bryce: [00:04:52] I do have a car. 

Alec: [00:04:53] Yeah. 

Bryce: [00:04:55] Your partner has a car.

Alec: [00:04:56] Don't factor that in. 

Bryce: [00:04:57] Okay. Vehicle. So in terms of transport costs for my budget and main factors for me, car service, car rego, petrol and tolls and then any I guess miscellaneous public transport that I do. So we recently got slugs. $2,900 for a car service. That is about that is definitely not what we usually budget for. We just hadn't had IT service since pre-COVID. And they essentially said that you brake pads are done if you don't have it, they always say. So I gave them a call and they said, no, you really need to do it. But between tolls, petrol, radio and service, we budget 1580 a year. Insurance is actually probably one of the biggest factors, but we'll talk about insurance when we get to the insurance. So yes, service and rego, petrol and tolls. Tolls. I find if you didn't live in a capital city, you can save a lot. I remember when we used to I used to drive to work at Woolworths whilst I didn't have the car. It was through a work car. You could easily clock up to 300 bucks a month in tolls, which was just. It's just nuts. Yeah. Yeah, it's unbelievable. So, yeah. 

Alec: [00:06:09] So that's your budget. I guess the question is, what are the things that you've done to reduce cost? 

Bryce: [00:06:16] So most recently my wife has stopped driving to work completely. So that cuts, tolls and petrol.

Alec: [00:06:23] How does she.

Bryce: [00:06:24] Bus. Yeah. Yeah. So she, she buses. Because not only that, she was then having to pay for parking when she got there as well. So we've reduced cost of parking costs of tolls and costs of petrol. Outside of that we can't really do a lot with rego and I think our learning from the servicing thing is the more regular you get it serviced, the more I guess opportunity you have to avoid large lumpy payments and you can probably deal with the cash flow a little bit better.

Alec: [00:06:55] Big revelations coming on this episode. 

Bryce: [00:06:59] But for us it's back to public transport. I walk to work. So I think we're fortunate in that I don't I personally don't have a massive commute. 

Alec: [00:07:05] So neither of you are driving your car to work. You've given up your golf membership. I don't know when that comes in. 

Bryce: [00:07:12] That's in force right now. 

Alec: [00:07:14] So you're not driving to and from golf, which was a key reason to have the car. Yes. You live in the most central part of Sydney. Mm. Have you thought about making that big step.

Bryce: [00:07:26] Selling it. 

Alec: [00:07:27] Getting rid of the car? 

Bryce: [00:07:28] No, because we, we like, we like travelling down to the south coast. I think that's the biggest. 

Alec: [00:07:33] But you travel down with your wife's family and there are. 

Bryce: [00:07:37] We are not going the same. 

Alec: [00:07:38] There are multiple cars leaving Sydney. There's also a train station. 

Bryce: [00:07:41] There is a train. I took the train the other day. It was very, very good, very easy.

Alec: [00:07:45] The only challenge is getting from the train station to the hill. 

Bryce: [00:07:49] Yeah, yeah, yeah. And taking bikes and golf clubs. 

Alec: [00:07:53] That you can take bikes just right up the hill. 

Bryce: [00:07:56] Have you seen this hill. 

Alec: [00:07:57] I ave I went to your wedding. Yeah. 

Bryce: [00:08:00] Yeah. Now it's a fair call. I think the flipside is it because it's sitting there, what we really use the car for each week is a Sunday trip to the shops and we do our weekly shop and that's really about the only time we use the car. Now. The rest of the time it sits in the street. So we could do like a come car next door. 

Alec: [00:08:18] Come on. One trip to the shops. 

Bryce: [00:08:20] Yeah. 

Alec: [00:08:22] Think of how much money you would save if you just think and think of the insurance that you're paying and all of that parking permit. I'm sure a city of Sydney would sting you for one of those that you could your woollies online delivery fee would would be a massive saving compared to having a car for a once a week shop.

Bryce: [00:08:39] Yeah, well, as I said, it's just sitting there, but we need it, you know, getting to Wagga, there's, there's instances where we need how. 

Alec: [00:08:46] Often are you going to get that.

Bryce: [00:08:47] You easily save it in. You would easily save the car justified against the price of a plane ticket. No question. 

Alec: [00:08:54] Rex. Rex. What's that in you want bonds. I know. 

Bryce: [00:08:59] They're expensive. 

Alec: [00:09:01] Cars are expensive.

Bryce: [00:09:02] They are. Guess it's sitting there. It's a minimum 1500 dollar on road cost for us to just sit there. 

Alec: [00:09:09] But it was more than double that this year. 

Bryce: [00:09:11] Yeah, yeah, yeah. This year we've at least had four and a half go out. Yeah. And that hurt. 

Alec: [00:09:16] Now you can get to Wagga a few times without that really hurt. Well Bryce, there's a reason that I'm pushing you so hard to sell your car and that is because I took that plunge last year. I had all the same reservations that you did. How am I going to visit Bryce's parents in Wagga? How am I going to go with Bryce and have down the south coast? But once I took that plunge, my life changed. So let's take a quick break and then I'll tell you how I manage this transport category, including one very controversial call. All right, Bryce, we're back. We're talking cost of living. And in particular, in this episode, we are talking transport. Before the break, you explained how you manage this bucket of spending, this category. And Mr. to quote Bryce a few weeks ago, and get started investing. I'm such a good saver. There's nothing more I could do to save. 

Bryce: [00:10:16] We've done what we can 

Alec: [00:10:18] Transport category blew this year. You spent three times what you budgeted. 

Bryce: [00:10:23] Yeah, well, that's because we weren't anticipating 3 Grand. It's really servicing. 

Alec: [00:10:28] Well, let's. Let's get to what I have done. About two years ago, I had a similar situation to you. I had a mechanic say that to get a what is that pink slip? Blue slip, the one that you get roadworthy. It was going to cost me about three and a half full grant. And my car was I loved my car, but it was pretty old. 2006 I think was the model. And I did some research on how much I would be able to sell it for, and it was probably about four or five grand, so I'd be spending about four grand to get it roadworthy again. And, you know, if I turned around and sold at the day after, I'd get five. So I made the decision that it probably wasn't worth getting repaired and I'd try and sell it. And so I sold it. And I have become a bus guy.

Bryce: [00:11:23] Nice.

Alec: [00:11:24] And once you become a bus guy, you'll never look back. So that's my biggest saving there. Obviously, I'm not spending on fuel or anything anymore. Tolls. 

Bryce: [00:11:38] Car repairs when you share the cost with your partner. 

Alec: [00:11:41] Well, I don't drive the car. So like if we're doing a wedding and like we've had a number of country weddings, I'll chip in for fuel. But other than that, I don't know. Nothing. 

Bryce: [00:11:56] I mean well, I mean like, I don't know. I have no idea. But like, do you get to a point where like, it's obvious that it's your collective car? 

Alec: [00:12:04] Put it this way, I would never think that I could drive it. 

Bryce: [00:12:10] Right. I yeah.

Alec: [00:12:11] Like, I don't feel and I don't feel any ownership of the car yet. 

Bryce: [00:12:15] Yeah, yeah.

Alec: [00:12:16] Yeah, yeah. I pay for half a garage. You can jump in the Facebook group and tell me if I should do more here. No, Now I'm feeling self-conscious about it. 

Bryce: [00:12:27] Well, I mean, that's where it got to with me and have, like, have owned the car. She. It was her car, but it became like.

Alec: [00:12:32] You were driving it to golf and like you were you were using it. Yeah, well. 

Bryce: [00:12:36] That's that's what I mean. Like, it got to a point where, like, we're obviously married and it became our own family car. Yeah. Yeah. Well, you know what I mean. 

Alec: [00:12:49] All right, well, now you've really only thought. Well, let's let's continue. I want to throw something quite controversial out there that I believe is saving me money. UBerOne. 

Bryce: [00:13:02] What's UberOne? 

Alec: [00:13:03] It's a subscription service. Monthly subscription service. Okay. $9.99 a month. 

Bryce: [00:13:08] Okay. 

Alec: [00:13:09] Because there are times where as great as the bus is, it doesn't get you everywhere. And so there are times when you've got a mover or you've just had a few beers and you can't be bothered waiting for the bus. So, no, I'm $9.99 a month. According to the Uber app, I've saved $51 in the last month. [00:13:26][17.1]

Bryce: [00:13:27] But what what does it give you?

Alec: [00:13:29] So you get 5% credit back on all rides, which you can then use for future rides. And you also get a $0 delivery fee and reduced service fee on over eight. 

Bryce: [00:13:41] That's not bad. Yeah. 

Alec: [00:13:42] So Uber Eats has definitely contributed there as well. Yeah. 

Bryce: [00:13:46] Yeah, we use that a lot, don't you? The grocery shopping. 

Alec: [00:13:49] Yeah, yeah, yeah. 

Bryce: [00:13:51] One for me. If you're looking at reducing transport costs and this is probably more applicable to Metropolitan is the go gets or the Connick stores I have a subscription to go get if you actually if you have an ABN as well you actually don't have to pay the monthly subscription cost and that goes for sole traders whatever if you just have an ABN so you can get access to go get, which are the sort of share cars and they're anywhere from like nine to sort of $15 an hour and, you know, 40 to sort of $0.90 per kilometre. So for this instance where we go to the shops once a week, that's the perfect opportunity to choose a car you have.

Alec: [00:14:28] Is it like, okay, you have an ABN and you have a go get account. Yeah. And you still get your car for one night. 

Bryce: [00:14:36] Sure. You're not going to be out of convincing on this. You're going to have to convince my wife. 

Alec: [00:14:40] Well, that's two different things. I'm not going to try and convince your wife, but I'd love to get to a point where I convince you. 

Bryce: [00:14:46] It's not going to happen. It's not my car. So I chip into it. But like, yeah, we need we like the car. I don't having it, but. 

Alec: [00:14:53] I just want you to be convinced.

Bryce: [00:14:55] It's you're not going to convince me, but I'm a very I'm a strong proponent of go get when I didn't have the car and we lived down in in a share house in Rush Cutter's we use go to get quite a bit and then similarly with car next door and those sort of ride sharing apps I think are really great as well. 

Alec: [00:15:12] Why don't you put your car on COMEX? 

Bryce: [00:15:14] So yeah, I do think about it, but 

Alec: [00:15:16] Haven't done it with the

Bryce: [00:15:17] Thought. Well, it's just kind of like the management of it and I like, yeah. 

Alec: [00:15:22] Getting a part. 

Bryce: [00:15:22] I haven't really got.

Alec: [00:15:23] It is in a true place. 

Bryce: [00:15:24] Trusting it, trusting the people. Yeah, but it's one one to think about if you are in a car that's just sitting there, what is it? A connected door and Turo I think are the big marketplaces.

Alec: [00:15:35] That would be a pretty easy $100 challenge for you. 

Bryce: [00:15:37] One that's a good call is a test.

Alec: [00:15:39] Yeah. Tell us how it goes. 

Bryce: [00:15:41] And then finally, I think if you want to reduce your costs, obviously catch public transport. That's a given. But there is an app as well that I've seen going around recently. It's alright, there's probably a couple, but they give you the price of petrol at all the petrol stations in your area. And so if you're looking to fill up your car at the cheapest spot without driving too far to then outweigh the change in petrol price. Yeah, it's worth having a look. 

Alec: [00:16:06] These apps have been around for ages. I am so like I don't have a car anymore, but petrol is. I like it's an impulse purchase but it's like a convenience purchase. It's like I want something that's like on my way I reckon.

Bryce: [00:16:19] Yeah. Well I guess it depends like how much you're filling up. Like if you gonna save 20 or 30 bucks, like it's probably worth driving an extra block to find it. Yeah. Yeah.

Alec: [00:16:29] Anyway, there's also we've, I don't know if the ads are still running but we were running ads for 7-Eleven fuel price lot. So if you want, if you drive near a 7-Eleven and you want to lock in a price, you can check that out. This bit isn't sponsored, just a free extra plug for them. 

Bryce: [00:16:44] That's it. So ridesharing petrol apps catch the bus, Uber ones. 

Alec: [00:16:49] Sell your car, sell. 

Bryce: [00:16:49] Your car. There are plenty of ways that you can reduce costs in transport. We'd love to hear. 

Alec: [00:16:54] I think we should recognise that we are having this conversation from the place of two people without kids. 

Bryce: [00:17:03] Yeah, yeah, yeah, absolutely. 

Alec: [00:17:04] And for a lot of people, as soon as kids get in the equation, then the idea. Selling your car or putting it on the car next door during a wake or, you know, walking to work becomes a lot harder because you got to factor in kids dropping off and picking up sports on the weekend and all of that stuff. Yeah but I guess that's the situation we're in. And with so many of these spending categories, if you do need it, there's not a lot that you can do. 

Bryce: [00:17:31] No, it's just the small things like being conscious of petrol and those sorts of things. So we'd love to hear from you. Jump into the community Facebook group. Firstly, A Ren should be contributing more to his car costs and B.

Alec: [00:17:44] No, no contributing to my partner's. 

Bryce: [00:17:47] True. Partner's car costs. And secondly, if you have any ideas or ways in which you are saving on your transport costs, we'd love to hear from you. Next week we are talking about food and non-alcoholic beverages, so we'll pick it up then.