I’ve been harping for years about the value of getting and using ebikes, and specifically, how this single decision to get around with an ebike can be worth millions of dollars to you. The math simply doesn’t lie. Cars are extraordinarily expensive to own and maintain, and opting not to use a car, if you can do it, is worth a lot of money.
But realistically, I get it. If you live in the United States, a car might be a necessity for you. Indeed, even though I bike year-round as my primary mode of transportation and constantly talk about the benefits of using ebikes over cars, I actually don’t live in a car-free household. My wife and I own one car – a 2023 Chevy Bolt EV that we bought two years ago to replace an aging Toyota Prius that had just had its catalytic converter stolen.
Owning this one car comes with some large costs. We had to pay high upfront costs to buy the car, plus we pay monthly insurance and yearly registration fees. While we don’t pay for gas, we do pay for electricity to charge it. There’s also some maintenance to deal with, although our maintenance costs have been light so far. These costs add up to thousands of dollars every year, but ultimately, it’s a cost we’re willing to bear. My wife works far out in the suburbs, so she needs a car to get to work. Plus, the convenience of having a car on hand is worthwhile.
The big decision for us, I think, wasn’t about buying this one car. It was about the decision to buy a second car. When my second son was born a few years ago, I was faced with this exact decision. With two children to transport, I needed to make a choice – was I going to get a second car so I could get the kids around when my wife had our car, or was I going to make do with just one car and use an ebike to get my kids around.
I opted to go with the ebike and to transport two kids, I specifically opted to buy a cargo bike (the Urban Arrow, specifically). This single decision – to get an ebike instead of a second car – can be worth millions if I stick with it for the long haul.
This is where the real value of an ebike can come into play. In most places in our country, it’s probably unrealistic to go completely car-free. But going with one car might give you the best of all worlds. You still have a car when you need it, but you save thousands every year by not dealing with a second car. I think there are millions of people out there who could make do with just a single car – if only they’d consider it.
Replacing A Second Car With An Ebike
It’s pretty common in the US for an average household to own two or more cars. Indeed, according to data from the US Census Bureau, 37% of American households own two cars, and 22% own three or more cars. In other words, nearly 60% of households in the US own at least two cars.
It makes sense why so many households have multiple cars. In most of the US, we’ve built our cities in a way where if you don’t have a car, you’re not going to be able to leave your home or participate in society. That means for many households, you’re forced to buy a car for each adult member of the household (and sometimes, even teen members of the household), at a cost of thousands of dollars per year in ownership costs for each car.
While going car-free can be difficult, and perhaps even impossible depending on where you live, it’s not as big of a leap to forego the second car and try to make it work with just one car for two adults.
Most people don’t travel as far as they think to most places. Indeed, the majority of car trips in the US are 5 miles or less. Traveling 5 miles with your standard ebike is only a 20-minute bike ride if you’re riding at an average speed of 15 miles per hour (which I’d consider pretty slow on an ebike). Even commute distances for most people aren’t that long, with median commutes in most states at around 6 to 8 miles typically – or about a 30-minute ebike ride for most people. When you consider that more people than ever are working from home now too, the need for a second car could be even less.
And the big reason people get cars – to move children or to get groceries – can be handled with electric cargo bikes. I’ve been able to haul everything, including $200 or $300 worth of groceries from Costco, Christmas Trees, multiple bags of mulch, and even a piece of furniture that I couldn’t fit into my car, but that could fit in my cargo bike.
This is why I bought my cargo bike. It was an expensive purchase, but it does almost everything my car can do. For the few times I do need a car, I can use the one car I own or I can rent a UHaul if I need it. And while the upfront cost of my cargo bike was high, it’s still far less than the upfront cost of a decent car, not to mention the maintenance costs are minimal (here’s a post about what I spent on my cargo bike after 5,000 miles).
I said this already, but replacing a second car with an ebike, in a way, gives you the best of all worlds. You get huge cost savings by not paying for a second car. And you’ll still have a car for the times when you really do need it.
The Massive Financial Benefits Of An Ebike As A Second Vehicle
I’ve written in detail about the massive financial benefits of ebikes, so I’m not going to go too deep into it here. If you want to learn more, check out my post, An Ebike Could Be The Best Investment You Ever Make. I also have a speech I gave at EconoMe on the massive financial benefits of ebikes.
The main things to understand about a car are (1) how much you need to save in your portfolio to cover your car expenses and (2) how much the money you spend on your car could be worth if saved and invested (i.e. opportunity cost).
Cars aren’t cheap and even if we don’t notice those costs, they are real costs that you bear. Things like upfront costs, car payments, depreciation, maintenance, gas, insurance, and parking all go into the cost of our cars. Data from AAA shows that if you add those costs up, your average car costs over $12,000 per year in ownership and maintenance costs. A two-car household with two people driving their cars regularly might be spending $24,000 per year just on their vehicles.
Using the 4% rule (which says you can withdraw 4% of your portfolio to cover your expenses), you’d need $300,000 to cover your car costs. A two-car household would need $600,000 to cover their cars. For those of us trying to reach financial independence, that’s a lot of time we’re going to have to spend to earn the money to pay for those cars. Foregoing one car and using an ebike instead could mean $300,000 less you need in your portfolio and perhaps years of time you can gain back.
The opportunity cost of that second car is also significant. If you’re spending an additional $12,000 per year to own a second car, you’re looking at money that could be worth over $1 million over 30 years. Most of us will own cars for much longer than 30 years, so that’s potentially millions of dollars you could have if you opt to use an ebike instead of a second car for many decades.
The Financial Independence Community Thinks Outside The Box
What I find interesting is how in the financial independence community, many of us are willing to do crazy things to achieve our financial goals. We’re willing to save 50% or more of our paychecks to become financially independent and we’re trying to retire decades earlier than most people.
And yet, when we think about our transportation needs, most of us don’t do much other than drive old cars or buy cheaper used cars. This is all pretty normal advice that you hear everywhere. But I like to think we’re a bit beyond the normal advice. The beauty of this community is we’re already primed to think differently.
I think there are very few people who absolutely need two or more cars. Most of us are already working from home more often. We have phones that can get almost anything delivered to us when we want it. We can use Uber or Lyft or get a rental car when we need to get somewhere by car. And most importantly, ebikes (and even better, cargo ebikes) can replace the majority of trips you might have thought you need a car for.
Final Thoughts
Riding a bike as a form of transportation is something that can seem weird at first, but eventually becomes normal once you start doing it. It’s a mindset shift, very similar to the mindset shift many of us had when it came to thinking about financial independence.
These days, when I think about going anywhere, my mind naturally thinks about how to get there by bike. Getting somewhere by car is a secondary thought for me – even weird to me (why drive when I can bike there just as fast with way less stress). It takes time to make this mindset shift. But once it happens, you’ll never look back.
So many of us have more cars than we need. And it all comes at a huge cost. We’re trading years and years of our lives to pay for these cars. That’s a trade-off that I don’t think it worth it for most people.
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More Recommended Ebike/Scooters
Check out these other ebikes and scooters I've reviewed:
- Urban Arrow Ebike – Last year, I made one of the largest purchases I’ve ever made – I bought a $9,000 electric cargo bike from Urban Arrow. In my Urban Arrow review, I will discuss what it is and why I decided to buy this bike, as well as discuss how impactful a bike like this can be on your journey to financial independence.
- Troxus Explorer Step-Thru Ebike – The Troxus Explorer Step-Thru is a fat-tire ebike that I’ve had the pleasure of riding for a while now. It has amazing power, great looks, and awesome range. If you’re looking for a great fat-tire ebike that offers a lot for the price, the Troxus Explorer Step-Thru is definitely one for you to consider. Check out my Troxus Explorer Step-Thru Review.
- Hovsco HovBeta Ebike – The HovBeta is a folding ebike with great specs and a lot of interesting features, and importantly, it’s sold at a good price point. I’ve had a blast commuting with it and using it to do deliveries with DoorDash, Uber Eats, and Grubhub. Check out my Hovsco HovBeta Ebike Review.
- Vanpowers Manidae Ebike – The Vanpowers Manidae is a fat tire ebike that I’ve been riding as my primary winter commuting bike and have also been using it to do food delivery with apps like DoorDash, Uber Eats, and Grubhub. After clocking in a decent number of miles with this ebike, I wanted to write a post sharing what my experience with the Vanpowers Manidae ebike has been like. Check out my Vanpowers Manidae Review.
- Sohamo S3 Step-Thru Folding EBike Review – A Great Value Folding Ebike – The Sohamo S3 Step-Thru Folding Ebike is an entry-level folding ebike that offers a lot of value for the price point. I’ve been riding the Sohamo S3 for a while now, putting the bike through its paces, and I have to say, this bike has exceeded all of my expectations. Check out my Sohamo Review.
- KBO Flip Ebike – The KBO Flip is an excellent bike. I’ve had a great time riding it and think it’s a versatile bike that can be used for a lot of purposes and can fit a variety of lifestyles. It’s worked out great for me as a general commuter bike and as a food delivery bike. Check out my KBO Flip Review.
- Hiboy P7 Commuter Ebike – The Hiboy P7 is an excellent electric commuter bike that’s offered at an affordable price point. The range and speed of this bike are both very good, so you won’t have any trouble getting anywhere you need to go with it. As a food delivery vehicle, this is also good – with how much range it offers, you’ll be able to work all day on a single charge. Check out my Hiboy P7 Commuter Electric Bike Review.
- Himiway Escape Ebike – The Himiway Escape is an interesting bike for anyone looking for a moped-style ebike. If you’re a gig economy worker, the Himiway Escape is particularly interesting and it’s possible to think of it as an investment, especially if you can opt to do deliveries with the Himiway versus using a car. It’s not cheap, but you can definitely make your money back when you compare the mileage you’ll put on your car versus using an ebike. Check out my Himiway Escape Bike Review.
- Espin Sport Ebike – The Espin Sport is a good ebike for someone who is looking for an ebike that feels and rides more like a regular bike. There are many ebikes that are really only bikes in name. In reality, they’re basically electric mopeds. The Espin Sport, by contrast, is a bike you could probably ride without the battery and you’d feel like you’re just riding a regular bike. Check out my Espin Sport Review.
- Varla Eagle One Scooter – The Varla Eagle One is an excellent scooter that can make sense for a lot of people. It can work as a primary mode of transportation. You can use it to work on gig economy apps like DoorDash, Uber Eats, and Grubhub. And it can also be a recreational vehicle if you’d prefer to use it for that. Check out my Varla Eagle One Review.
- Varla Falcon Scooter – The Varla Falcon is an excellent scooter that offers a good amount of power at a lower price point compared to more powerful scooters. It’s not exactly an entry-level scooter, nor is it a high-powered scooter. I think it fits somewhere in-between those two categories – an intermediate scooter if I had to give it a category. Check out my Varla Falcon Review.
- Hiboy S2 Scooter – The Hiboy S2 is an excellent entry-level commuter scooter that's perfect for someone looking to save some money in transportation costs and improve their commute. Check out my Hiboy S2 Review.
- Hiboy S2R Scooter – The Hiboy S2R is one of the more interesting electric scooters I’ve been able to test out. It’s not a high-powered scooter, but for an everyday transport option, it’s very useful, especially given some of the unique features that it has. Indeed, for the price, the Hiboy S2R might be the best value scooter I’ve used. Check out my Hiboy S2R Review.
- Fucare H3 Scooter – The Fucare H3 is a fun scooter and I’ve enjoyed testing it out. For a daily commuter or quick trips or errands, the Fucare H3 is probably the scooter I’ll use. It’s portable and easy to maneuver, so it’s just easier to take on the road when I need it. Check out my Fucare H3 Scooter Review.
More Recommended Investing App Bonuses
For additional investing app bonuses, be sure to check out the ones below:
- M1 Finance ($100) – This is a great robo-advisor that has no fees and allows you to create a customized portfolio based on your risk tolerance. You also get $100 for opening an account. Check out my M1 Finance Referral Bonus – Step-By-Step Guide.
- SoFi Invest ($25) – SoFi Invest is an easy brokerage account bonus that you can earn with just a few minutes of work. Use my SoFi Invest referral link, fund your SoFi Invest brokerage account with just $10 and you’ll get $25 of free stock. I also have a step-by-step guide for the SoFi Invest referral bonus.
- Webull (20 free stock shares) – Webull's current promotion gives you 20 free shares valued between $3-$3,000 each if you open an account using my referral link. Here’s a guide I wrote about how to earn your free shares using Webull.
- Moomoo (15 free stocks) – Moomoo is a free investing app currently offering 2 different referral bonuses if you open an account using a referral link. Read my Moomoo referral bonus guide for more information.
- Robinhood (1 free stock) – Robinhood gives you a free stock valued between $2.50-$225 if you open an account using my referral link.
- Public (1 free stock) - Public gives you a free stock valued between $3-$70 if you open an account using my referral link.
More Recommended Bank Account Bonuses
If you’re looking for more easy bank bonuses, check out the below options. These bonuses are all easy to earn and have no fees or minimum balance requirements to worry about.
- Upgrade ($200) – Upgrade is a free checking account that’s currently offering a $200 referral bonus if you open an account and complete a direct deposit. These bonus terms are easy to meet, so it’s well worth doing this bonus as soon as you can. Here’s a post I wrote with more details: Upgrade $200 Referral Bonus – Step By Step Directions.
- Ally Bank ($100) – Of all the banks out there, Ally is, without a doubt, my favorite. At the moment, Ally is offering $100 to customers who open an eligible Ally account and meet the requirements. Here are the step-by-step directions to earn your Ally Bank referral bonus.
- Fairwinds Credit Union ($175) – Fairwinds Credit Union is offering a referral bonus for users that sign up using a referral link. Fairwinds has no fees or minimum balance, so this is a particularly easy bonus to earn. Since this is a smaller credit union, my gut instinct tells me this offer won’t be around long, so if you’re in a position to meet the bonus requirements, grab this bonus before it’s gone. Here is my step-by-step guide on how to earn your Fairwinds Credit Union bonus.
- Chime ($100) - Chime is a free bank account that offers a referral bonus if you use a referral link and complete a direct deposit of $200 or more. In practice, any ACH transfer into this account triggers the bonus. This bonus is easy to earn and posts instantly, so you’ll know if you met the requirements as soon as you move money into the account. I wrote a step-by-step guide on how to earn your Chime referral bonus that I recommend you check out.
- US Bank Business ($900) – This is a fairly easy bank bonus to earn, since there are no direct deposit requirements. In addition, you can open the Silver Business Checking account, which comes with no monthly fees. Check out how to earn this big bonus here.
- GO2Bank ($50) - GO2Bank is an easy bank bonus that I recommend people take advantage of if they have an easy way of meeting the direct deposit requirement. I like that it’s easy to open the account and that the bonus pays out quickly. Check out my step-by-step guide on how to earn your GO2Bank $50 referral bonus.
- Current ($50) – Current is a free fintech bank that’s offering new users a $50 referral bonus after signing up for an account using a referral link. Current is an easy bonus to earn and also gives you access to three savings accounts that pay you 4% interest on up to $2,000. That means you can put away up to $6,000 earning 4% interest. That’s very good and makes Current an account I recommend to everyone. Check out my step-by-step guide on how to earn your Current Bank bonus.
- Novo Bank ($40) - Novo bank is a free business checking account that’s currently offering a $40 bonus if you open a Novo business checking account using a referral link. In addition to being a good bank bonus, Novo is also a good business checking account. It has no monthly fees or minimum balance requirements and operates a good app and website. Indeed, it’s the business checking account I currently use for this blog. Check out my post on how to easily open a Novo account.
- Varo ($25) – Varo is a free fintech banking app similar to Chime or Current. It’s currently offering a $25 bonus to new users that open a new Varo account with a referral link. The bonus for this bank is very easy to meet, all you need to do is spend $20 within 30 days of opening your Varo account. Check out my step-by-step guide to learn how to earn this bonus.
Kevin is an attorney and the blogger behind Financial Panther, a blog about personal finance, travel hacking, and side hustling using the gig economy. He paid off $87,000 worth of student loans in just 2.5 years by choosing not to live like a big shot lawyer.
Kevin is passionate about earning money using the gig economy and you can see all the ways he makes extra income every month in his side hustle reports.
Kevin is also big on using the latest fintech apps to improve his finances. Some of Kevin's favorite fintech apps include:
- SoFi Money. A really good checking account with absolutely no fees. You'll get a $25 referral bonus if you open a SoFi Money account with a referral link, and an additional $300 if you complete a direct deposit.
- 5% Savings Accounts. I'm currently getting 5.24% interest on my savings through a company called Raisin. Opening a Raisin account takes minutes to complete, it's free, and all of your funds are FDIC-insured. I explain how it works, why I'm now using it to store my emergency fund and any other cash savings I have, and why I recommend everyone check it out in this review.
- US Bank Business. US Bank is currently offering new business customers a $900 signup bonus after opening a new account and meeting certain requirements.
- M1 Finance. This is a great robo-advisor that has no fees and allows you to create a customized portfolio based on your risk tolerance. You also get $100 for opening an account.
- Empower. One of best free apps you can use to monitor your portfolio and track your net worth. This is one of the apps I use to track my financial accounts.
Feel free to send Kevin a message here.
Hi! Getting a bike instead of a second car sounds like a smart financial move, I suppose! Especially with the rising costs of having multiple vehicles.
I got 2 ebikes for me and my son last year. They’re great. Now, we ride whenever we need to go anywhere nearby. Previously, we used to walk. Biking is way more fun and faster.
We shared one car for over 20 years now. Luckily, we also have pretty good public transportation so we never really need a 2nd car. That’s one advantage to living in the city.
One concern I have that wasn’t metioned is safety. With a car, you are wrapped in metal so if you get in an accident, your risk to bodily injury is much less. E-bike, motocycle or bike, you’re much more exposed to the crazy drivers that don’t give a crap about you.
Right there with you on the ‘burbs. It’d be laughable if it wasn’t so facepalm-worthy how many things most of them get wrong, on the transportation front as much as anything. But you’re spot on that fixes are right there for the taking . . . if they want to. Hopefully a virtuous circle gets created at some point.
Right on. We bought an ebike a few years ago, but have been a city-based, one-car family for more than 25 years. The number of times that having only one car has presented any issue i can count on one . . . maybe two hands. And while the ebike hasn’t been a total game changer for us on a macro level, it has: (1) allowed us to replace many commutes we might otherwise have taken by car, and so in time will more than pay for itself; (2) spurred more overall commutes (that is, we might have stayed home because we didn’t want to drive the car somewhere, but were happy to take the trip by ebike); (3) made for commutes that are not just easier, but faster than by car; and (4) allowed for more exercise, which I hope will have some (money-saving) health effects.
This all said, I once wrote a post somewhat similar in theme arguing for greater consideration of living in a condo/apartment over a house. A commenter remarked that my post didn’t resonate with him because he lived in a very rural area (where, I presume, condos/apartments were in short supply at best). That was something I hadn’t considered. So, I think an ebike as a replacement for a second car/truck could be tough for rural folks. That said, I’m positive that even in rural areas, an ebike could replace (many) commutes and thus save a lot of dough by way of less gas consumption/purchases; less wear and tear on the car/truck; and possiblly less in insurance on the second car/truck by way of lower rates for staying under a miles threshhold.
So for rural people, I agree that cars are much more of a necessity, although I wonder what the driving patterns are for rural people. In any event, the rural population in the US is just 14% and I have to assume is continuing to drop as young people move out and the rural population continues to age.
Most people in the US actual live in urban and suburban areas.
The suburbs are where I think ebikes are really powerful because the distances most people are actually traveling in the burbs to places they need to go isn’t that far. Even in the burbs, the grocery store is probably within a few miles. It just seems far away because of how car-centric those places are.
And interestingly enough, burbs are actually well positioned to create good cycling infrastructure because they already have plenty of space to create separated bike paths. In a city, creating bike infrastructure is a trade off because the space is limited. Not so in the burbs.
When I’m out in the burbs, I always ask myself why there isn’t a separated bike path on every street. The space is already there.Then you put an ebike into the mix and suddenly the burbs can be great places to get around outside of a car. The advantage here too is that unlike mass transit which doesn’t work well in the burbs because of density issues, safe bike paths and ebikes can work there regardless of density.