I used to work and live in North London within five minutes’ distance and it worked out quite well as I spend little no time and my monthly work-related travel expenses were only about £20 which is close to nothing when many people spend around £100-£160 per month (depending on how far from work you live). So when I got an offer to work in central London for couple of grand I had to consider that if I buy travel card it will equate to over £1K of my gross salary so the net increase in my pay would not be that big. So I was looking for a ways to make my travel arrangement more cost effective without sacrificing much of the convenient (and as it turned out I actually gained extra benefits and save time).
Few months after I started my new job I was introduced to ride2work government scheme where participating employers give their employees benefit of interest free 12-month bike finance where payments are deducted from your gross instead of net salary – which essentially means that you are saving extra 20% of bike’s (and accessories’) value as you have then reduced your taxable income. In my case I could get any bike from Evans Cycles. The certificate itself allows you to buy a new bike and any relevant equipment and accessories. So in my case I opted for medium price range bike @ £650 which was marked down to £550 and added extra accessories worth £100 or so (I also got £25 free accessories voucher when I buy a bicycle). Therefore instead of paying £700 in one go, I paid only £550 in equal payments of £46 (taking into account tax savings).
Cycling + Transport for London (TfL)
It takes just over 10 miles one-way to get to work which is 45 min by Tube, 1hr 20min by bus and about 45-50min by bike. I tried to cycle couple of times and got used to the route to work and made decision to aim for 2-3 times per week (which is enough effort yet gives me enough time in between to recover from the exercise), eight months a year (March – October) when it’s light and warm. I have seen some hard core brothers and sisters out there who cycle year round but I have not prepared myself to this yet. In the off days from cycling I get to work early in the morning taking advantage of off-peak pricing (Zone 1-4, £2.70 per ride) and go back home by bus (£1.40). The other four months I use public transport daily. Fair enough, I don’t always follow the same routine of off-peak Tube + bus, as sometimes I need to save time the traffic jams make the bus journey horrendous and so I don’t mind spending little bit extra (difference of £2.40 for peak-time Tube versus bus ride). But I also spend one month away from London on holiday so my workings kind of balance out.
I have estimated that my annual spend for work related commute is therefore around £800 per year which is saving of around £950 (yearly travel card Zone 1-4 – £1,744) or rather £1,216 (monthly travel card £167.50 x 12 months). First year savings are diminished by upfront cost – investment in bike and accessories – so it comes to only £400 – £666. Second year onwards, however, there is little to no expense as you can maintain your bike yourself for free. So I am looking at about 50% savings and more if I decide to cycle more frequent. This excludes any additional health benefits (free cardio workout) and saves me from getting costly gym membership which many people don’t really use and then feel guilty about their own foolishness when they signed up for year’s contract to begin with.
So those of you who are looking for cost optimization, this is win-win situation for your health and your wallet. I have been doing this for only a year but I foresee myself cycling more often in the future.