Downsizing To One Car Can Lower Auto Insurance Costs

The required insurance for owning more than one vehicle can be costly. A 2014 KPMG study found that fewer than half of American households will own more than one vehicle in 25 years. If it's feasible for your family to downsize to only one car, your car insurance rates and overall costs may decrease.

The sale of one car is money in your pocket

If you're able to sell your extra car for a good price, the money you receive can be used for other things, including paying off your remaining vehicle. On top of that, losing a car means not having to pay to insure it or pay for its gas. Instead, this money can be used as an offer if someone allows you to carpool with them or to pay for your one car's gas. Other costs, including license and registration fees and repairs and maintenance, will also decrease as a result of only owning one vehicle.

The transition of eliminating a car from one's household can be tough, but there are a couple of ways to work around not having additional vehicles.

1. Coordinate with your household

Even with one car, you may be able to find a schedule that works for everyone. Of course, with more family members, things tend to become more tricky, but by sharing schedules frequently, you can potentially find a feasible system.

Make the options known to all family members ahead of time. If changes to the plan occur, either the schedule will change a bit or family members will have to find other modes of transportation to get around.

2. Use public transportation

The cost of riding the bus or subway can be substantially less expensive than paying to insure multiple cars. In larger cities that are more walkable, you may be able to downsize to no cars, and rely solely on public transportation, bicycle or your own two feet. If it's necessary for you to have a car on certain occasions, accessible shared car rentals, like Zipcar, are available.

3. Carpool

Sharing rides is a great way to save money, as well as eliminate the need for additional vehicles. Take turns offering rides to co-workers who live nearby and vice versa. Offer neighbors and friends gas money or lunch on you if they're willing to let you tag along on their commute or to run errands.

Before you take the leap to becoming a one-car household, make sure to take factors like access to other modes of transport into consideration. Although the thought of losing a car can seem impossible to some, if you're looking to save on car insurance and other costs, owning only one car can make a difference.

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