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About a year ago my wife’s father passed away at 67 years old. He retired 3 months prior to receiving the worst news of his life and died 2 months later; never having pulled a dollar from his retirement funds or enjoying his new work-free life.

This was a wake up call to me – I was not happy. If I got hit buy a bus tomorrow I would leave this world thinking I had squandered away my precious little time on earth. We live on a huge planet and it’s impossible to see it all on 4 weeks of vacation a year. At least my father in law had traveled all over the globe.

I had not.

I started to envision how sorry my tombstone would read: “This guy spent a lot of time making spreadsheets and driving up the NJ turnpike.

We only get so much time on earth and for some that time is cut tragically short. To make matters worse is the fact that nobody knows how long their tenure will be. So it’s best to assume you’re not on the right side of the age distribution. Otherwise you may regret it when you realize its too late.

We are all programmed to think that you work until 65 and then you can enjoy your life’s work. But you’re old then and can’t run as fast as you used to or climb up big ole mountains anymore. And that’s what I love to do. That’s what I want to do. Nah, this can’t be it…I’m 34 and 65 is SO FAR AWAY.

I can’t wait until I’m 65 to live.

Something needed to change but was it? People told me to get a new job. But that wouldn’t solve anything as I don’t hate my job or my employer. My issue cannot be solved by sitting in a different cubicle or making spreadsheets for another type of business.

I wanted freedom – the choice to do what I want with my time. The freedom to not have to build my life around work. I wanted financial independence.

So I read, and read, and read. Blog after blog (Mr Money Mustache, The Mad Fientist, Scott Alan Turner,Our Next Life, Rockstar Finance just to name a few). Listened to podcast after podcast. And after all this reading and listening I came up with the following plan to achieve my goal. It’s quite intricate and complex so be prepared:

  1. Stop spending money on stuff
  2. Invest that money wisely
  3. Enjoy financial independence and ride your bike all day

That’s it.

So I made a list (in excel of course) of all our expenses and went through them one by one. Cut the cable, changed power providers, downgraded phone service, fired the maid, started driving slower, cut my own hair, bring lunches and breakfast to work. The list goes on.

But what was the most effective thing I did?

Bought a folding bike for $600.

Oh my sweet Dahoni Jones, whom you may remember from Part 1 of my So You Wanna Start Bike Commuting series. The best investment I’ll ever make.

My commute is epic – about 48 miles each way and requires a car, gas, criminally high tolls, parking, and excessive depreciation on my beloved Outback. In other words: it sucks. But it makes sense to work where I work at this moment in time. We’ll leave it at that.

I did a drawing of my commute which very accurately shows a day on the Jersey Turnpike. 


OK, but where does Dahoni Jones come in?

I was paying $225 per month to park next to my building at work. That’s a whole boatload of money. Like $2,700 a year, $13,500 over 5 years, or $27,000 over 10 years. Vomit! Just throwing money away.

But one day, after sitting in traffic for 35 minutes to move 2 miles a light bulb went off. “I typically bike 3 minute miles. If only I can park here I would save a ton of time.”

Since I wasn’t moving I was able to look around and found the answer! A parking lot which charged $56 per month 2 miles away from the office. Holy moly, I can save a ton of time and cash while doing the thing I love to do. This is the most no brainer of and idea I’ve ever had! 

And, well, that was it – I literally started the next week. I could have used a beater bike, as I’ve previously blogged, but the folding bike was convenient for the multi modal situation and would pay itself off in 3 months so I wasn’t worried about that cost. This was easy money. But what about the rain, snow and cold…I got gear for that!

Lets get to the numbers. As we know from The Opportunity Cost Machine  I’m saving more than just the $169 a month. I made a model which you can download and figure out how much you can save too! 

Lets look at inputs:

Variable Inputs Current New Diff
Daily total miles driven 96 94 2
Daily tolls  $15.10  $15.10  $-
Daily parking  $-  $-  $-
Daily public transportation  $-  $-  $-
Monthly parking  $225  $56  $169
Monthly public transportation pass  $-  $-  $ –
Car payment  $-  $-  $-
Fixed inputs Current New  
MPG of car 30 30  
Non gas price per mile  $0.23  $0.23  
Cost per gallon of gas  $2.29  $2.29  
Yearly savings (S&P, bank account) 6.0%    
Commuting days per month 20    

Which equates to the following monthly costs:

Monthly Totals Current New Diff
Gallons of gas used 64 62.6 1.3
Cost of gas  $147  $144  $3
Parking  $225  $56  $169
Public transportation  $-  $-  $ –
Tolls  $302  $302  $-
Depreciation and other stuff  $442  $432  $9
Car payment  $-  $-  $-
Total Monthly  $1,115  $934  $181
Total Yearly  $13,382  $11,207  $2,175

So, assuming 6% market return, the $181 I save each month will be worth the following in 1, 5, and 10 years:

Time Savings  ROI Annual ROI
1 Year  $1,056 11% 11.2%
5 Year  $ 11,148 1073% 63.6%
10 Year  $ 27,682 2814% 40.1%

And BOOM there it is, a 40.1% guaranteed ROI for 10 years! For the naysayers who gripe about all the costs associated with the bike and gear – that literally pays itself off in 5 months! After that its all gravy!

So, in summary, I spent roughly $1,000 (we’re being generous as I spent a lot less in gear) for the chance to get roughly $30,000 in 10 years. Even if I put the money into a 1% savings account that would be worth about $20,000 in 10 years (37% annualized ROI) .

But why is this the BEST investment I’ll ever make? Surely my hair cutting kit, coffee pot and crock pot have a higher ROI so why don’t I talk about them instead?

For one the savings are huge versus the other investments. Hair cutting and coffee cost an estimated $500 each per year. But its more than just ROI we’re looking at here. Riding also equates to about 20 minutes of additional exercise a day which people in our country sorely need. I always hear people complain about not having time to exercise but this allows one to exercise while they commute! Hows that for multi-tasking in the corporate world? Excuse busted!

But there’s still more. The bike signifies my commitment to my future as it was the first step in a series of frugal moves. Putting on galoshes and riding through the rain reminds me why I’m doing this. It’s more than saving a few bucks a day, it’s a small sacrifice for a much loftier goal.

Plus its fun as hell! Sitting in city traffic sucks.