Money Watch – Personal Finance Blog

I’ve recently been thinking about how much I use my car (a 1.1 litre Fiat Punto), and whether it’s something I can cut down on, and in the process, save money.

One of the problems I have is that I don’t really know how much driving my car costs me. I know the fixed costs, but I think that if I could put a definite cost on each trip, I could then easily see the savings I could make by getting finding a different way to the destination or by cutting out the journey completely.

So I’ve decided to start recording my mileage to work out my car’s miles per gallon (MPG), which will probably turn out to be the main factor in the equation.

To get a more accurate figure, I’ll also take into account insurance, tax and MOT costs (the fixed costs I mentioned above), plus some maintenance costs. Although depreciation is sometimes taken into account in these sort of calculations, that’s not something that particularly bothers me, as I don’t buy my cars expecting to be able to get any money back from then when I get rid of them (although I did have some luck selling my last car on eBay for an amazing £350, when I was expecting to have to pay someone to tow it away). I expect the Punto will be run until it falls apart, which hopefully won’t be too soon.

The first step then is to work out my car’s MPG, which will mean keeping track of how much petrol I pump in at the next fill up, and see how many miles it lasts for. I’ll report back my findings in a couple of weeks, but in the meantime, if you have any thoughts or have tried a similar thing yourself, let us know in the comments below.

photo credit: gahdjun