The best financial advice I can give you is to sell your car
What if the key to financial wellness isn't a budget app — but where you live?
Earlier this year, the New York Times published a piece marking the one-year anniversary of congestion pricing in Manhattan. They asked readers how the policy had changed their commutes, their routines, their lives.
I wrote in. And they published my response.
Here’s part of what I said:
“It has changed my life — I know that sounds a little ridiculous, but it’s allowed me to believe that perhaps America can change for the better. We live in a culture of cars — between parking spots clogging street space to building roads and intersections that are dangerous for pedestrians to the noise pollution (and air pollution!) ... not to mention the isolation and loneliness that comes from car-dependent cultures. The car, in many ways, has become the organizing principle of American life — a logic that has shaped our mental health, our economic structures — the very fabric of our communities.”
I realize I sound like a zealot. Bear with me. Because what I’ve come to understand — after years of living car-free, after becoming an insufferable urbanist who corners people at parties to talk about zoning laws — is that this isn’t just about bikes or bridges or traffic.
It’s about money.
The before
I grew up in Palisades (in Washington D.C.), a neighborhood that reads suburban despite being well within city limits — single-family homes, tree-lined streets and car-dependent.
Getting my license at 16 was a rite of passage. It was freedom — freedom from your parents, freedom to go to the mall, freedom to feel like an adult1. I remember the particular smell of my first car, a used BMW named Pepper with holes in the bumper (caused by me) and weird stains in the trunk (caused by my sister).
It represented everything I thought I wanted from life: independence, mobility, the American dream in miniature.
When I moved to New York in my early twenties, I had no car. Everyone I knew in the city was car-free — it was just what you did. I figured it would just be an adjustment. Learn the subway. Make do.
What I didn’t expect was to fall completely, stupidly in love.
Not with a person. With the city itself. With the way a Tuesday night could turn into an adventure just because you walked past a place with good music spilling out. With the friends I made on the train, at the bookstore, on the street. With the feeling of being somewhere instead of always going somewhere.
It wasn’t until years later that I understood why I’d fallen so hard. The magic wasn’t exclusively some ineffable New York quality (though, it definitely plays a role). It was infrastructure. It was the fact that I could walk to thirty restaurants, three grocery stores, and my best friend’s apartment. It was proximity. It was design.
And it was financial.
Because my money wasn’t going to things like car payments or insurance premiums or gas, I was able to spend more on things that mattered. More dinners out with friends. $6.50 to bike over the Williamsburg Bridge with LCD Soundsystem in my ears. Concerts. Broadway shows. Magazine launch parties that turned into natural wine pop-ups that turned into dinners with people I’d met that month.
I was spending money on things that brought me joy. And I had never been happier.
Research backs this up. A 2024 study published in Communications Psychology found that across seven countries, people who spent money on experiences derived significantly more happiness than those who spent on material goods. A massive 25-year review of happiness research found that spending aligned with intrinsic values and social connection creates more enduring well-being than spending on stuff.
My “stuff” budget wasn’t being dominated by a depreciating asset that spent most of its time parked. And it was awesome.
Tiktok failed to load.Enable 3rd party cookies or use another browser
What your car actually costs
The most obvious benefit of not owning a car is not paying for one.
According to AAA’s 2025 report, the average cost of owning and operating a car in America is $11,577 per year — or $965 a month. That includes depreciation (your car loses about $4,334 in value annually), finance charges, insurance, gas, maintenance, registration, and repairs. It doesn’t include parking tickets, the occasional fender bender, or the soul-crushing hours spent in traffic.
Most American households have two cars. So we’re talking about $20,000+ per year just to get around.
And the situation is arguably getting worse, not better. One in five Americans now pays more than $1,000 a month for their car — the highest share ever recorded.
For probably 80%+ of Americans, car ownership isn’t really a choice — the built environment makes it mandatory to get to your job, get healthcare, buy groceries, etc. You can’t meaningfully participate in American life in most places without one. So people buy cars because they have to.
A 2024 survey found that 13% of millennials regret buying their car because of the financial strain. Gen Z is cutting back on social activities — the experiences that actually make people happy — just to afford car payments. Half of all Americans have delayed necessary car repairs because they can’t afford them.
What traffic is doing to you
I just finished reading Life After Cars by the hosts of The War on Cars podcast. Their argument is that “cars are, without exaggeration, one of the most significant and negative environmental, political, social, and cultural forces in the history of humanity.”
That sounds hyperbolic until you start looking at what car-centric design has done to American life.
Atomization
Cars privatize what used to be public space and shared experience. You go from isolated home to isolated car to isolated destination (typically work). This contributes to loneliness, weakened community bonds, and political polarization — when you never physically share space with people outside your chosen bubble, it’s easier to see them as abstract threats rather than neighbors.
Americans spend nearly an hour per day driving on average — that’s time not spent with family, on hobbies, resting, or really doing anything productive. Traffic congestion makes this worse.
For children, car-dependent areas mean they can’t go anywhere without adult chauffeurs, extending childhood dependency, while creating enormous logistical burdens for parents, particularly mothers.
Economic segregation
Car dependency also functions as a massive barrier to economic mobility. If your car breaks down and you can’t afford to get it repaired, you might lose your job.
Car-centric development concentrates poverty in areas with (often) the worst transit access, creating geographic poverty traps where the spatial mismatch between jobs and affordable housing becomes a hard bridge without a car.
Public safety
We’ve essentially normalized a system where two-ton hunks of metal travel at deadly speeds through spaces where people live, and when someone gets hit, we blame the victims rather than the driver (or design).
Over the past decade or so, SUVs and trucks have gotten absurdly, dangerously large (which I call the vehicular arms race). Larger cars are more profitable for carmakers (in part because of regulatory loopholes). And as cars get bigger, drivers want to buy the bigger car to feel safer.
Which makes sense individually: If everyone else is driving a tank, you want a tank too. But collectively, it’s insane. Pedestrian deaths have spiked 75% since 2010, largely because getting hit by a Ford F-350 is not the same as getting hit by a Honda Civic.
Public health
Beyond the roughly 40,000 Americans killed annually in crashes, car culture creates sedentary lifestyles, air pollution that triggers asthma and respiratory issues, and urban heat islands from all that asphalt.
Studies show that longer car commutes are associated with elevated cortisol along with higher rates of depression, anxiety, and fatigue. Meanwhile, people who walk or bike to work report better mental health outcomes than those who drive.
Sprawl correlates with obesity, cardiovascular disease, and diabetes. It also contributes to isolation and loneliness. And where does loneliness thrive? In car-dependent sprawl. As one Strong Towns analysis put it: “America’s obsession with and dependence on low-density, single-family housing precludes people living close together.”
And I didn’t even mention the environmental destruction.
The larger problem is that car dependency makes the costs of cars invisible — you don’t see the health impacts, the social isolation as directly caused by cars. They’re just “how things are.” Which makes it incredibly hard to build political will to change, even though the costs are staggering.
We are under spells, people!!!
There’s a term in urbanist circles: “car brain.”
Car brain is the conditioning that makes driving feel like the only rational choice — even when it’s expensive, dangerous, and isolating. It’s the worldview that treats cars as synonymous with freedom and independence, while viewing alternatives like transit or biking as inferior, impractical, or vaguely un-American.
But why is it that people get so defensive when you suggest maybe, just maybe, we don’t all need a two-ton machine to buy coffee. Most of us are stuck in a trap, and admitting it’s a trap feels like admitting we’ve been duped.
Once you’re spending $700/month on a car payment plus insurance plus gas plus maintenance, you have to convince yourself you want it. Cognitive dissonance is painful. So you find reasons to rationalize the thing, to love the thing.
The car becomes part of your identity — your freedom, your autonomy, your adulthood. Decades of marketing have linked car ownership to independence, sexuality, status, the American dream itself.
A lot of the car brain mentality mirrors everything I write about in money psychology. We treat car ownership as a personal choice, just like we treat financial decisions as personal choices. But the choices were often made for us, decades ago, by policymakers, developers, car manufacturers, and oil companies.
The walkability premium
People know walkable neighborhoods are valuable. That’s why homebuyers pay a 35% premium for walkable real estate. Renters pay a 41% premium.
But walkable cities shouldn’t be a luxury good. They should be the default.
I’m choosing to look at it in a positive light — that when Americans actually get access to walkable neighborhoods with good transit, they pay a premium for it. Housing prices in transit-rich areas of DC, NYC, and Boston are astronomical because people want to live there. The demand exists. We just haven’t built the supply.
I don’t think most people are deeply, spiritually committed to car ownership. I think most people want autonomy, convenience, and not having to think about logistics. In America’s current infrastructure, cars deliver that — expensively, stressfully, at great cost to our health and relationships. But if we redesigned cities so walking and transit delivered the same autonomy and convenience?
What should you do with all of this:
If you can access a walkable neighborhood: Do a real cost-benefit analysis that goes beyond just comparing rent. Yes, that urban apartment costs more than the suburban house. But add up the car payments, the insurance, the gas, the time, the stress. Consider also what you’d spend — and what you’d save — on your health, your relationships, your sanity. For a lot of people, the “expensive” city is actually cheaper.
The H+T Index is a good place to start — it calculates true affordability by combining housing and transportation costs. What it shows, over and over, is that the “cheap” house with the long commute often costs more than the “expensive” apartment near transit.
If walkability isn’t accessible to you right now: You can still think about these trade-offs the next time you’re making a housing decision. You can advocate for better transit, for zoning reform, for bike lanes in your community. You can pay attention to local politics — the YIMBY movement, mixed-use zoning fights, transit funding votes. This stuff is financial wellness work, even if it doesn’t look like it.
When you think about what you want from your financial life, it’s also worthwhile to factor in the cost of isolation. The cost of time lost to commuting. The cost of a lifestyle that requires a $12,000/year machine just to function
What I actually believe
I haven’t owned a car in over a decade. And I’m increasingly convinced that this — not any investment strategy or budgeting framework — has been the most significant financial decision of my adult life.
Not because living in New York is cheap (it’s not). But because of the built-in walks to errands that keep me healthy, the neighbors I actually know, the hours I don’t spend in traffic, the money I’ve put toward experiences instead of a depreciating metal box — these are the financial infrastructure of my life.
I’m not saying everyone should move to a city, but I think we should stop treating financial health as purely a matter of willpower and following specific rules. Where you live matters. What you can walk to matters. What you have access to matters.
Maybe, when we think about building an economy that works for all of us, we should be asking: What would it mean to live somewhere designed for humans instead of cars?
See you next week,
Hanna
Tiktok failed to load.Enable 3rd party cookies or use another browser
I did, at one point, have a GPS tracker installed on my car because I kept sneaking out. So admittedly not full freedom.
Even in less walkable cities, you can become car-lite if you live in a less dense part of the city or in a streetcar suburb and change your mindset about “reliability”. My wife and I live in less dense part of Minneapolis. We own 2 ancient fuel-efficient cars (a 2006 sedan and a 2015 wagon). We have never had car payments. We have cheap insurance. When one of them dies, we will go to one car. Everyone in our lives - especially our most rural/suburban car dependent family - thinks it’s nuts we don’t upgrade our cars given how much money we make.
Essentially, we both drive a few days per week. April through October, we drive even less. I fill my car up once every 4-6 weeks most of the time. The way we’ve done that is by decentering cars in our daily lives. Here’s what we did:
1) make alternate transit access as part of your house hunt and job search. my wife works in downtown Minneapolis. Before, we were living in St Paul, and there was poor transit connection to her job so she had to drive and park. I saw that this was a missed opportunity (it’s not like she was working in an exurb with no transit connections). When we were searching for a house, I insisted we move to places where my wife could more easily bus or bike commute. It feels like car ownership means everyone I see househunting barely cares about how hard it will be to get to work from their exurban paradise. As long as they get their gift wrapping room and huge kitchen, they don’t care how isolated they will be. I feel like this is a mistake.
My wife has a new job, and it’s also in downtown Minneapolis. She was careful not to apply for jobs in farflung suburbs unless they were primarily WFH. (My job is like this, but I only work in the office one day per week.) I feel like people don’t factor in the commute enough in their job searches when they are car dependent. Sure, most people won’t accept a 120min commute, but most people with cars don’t prioritize finding jobs with NO required car commute. More people have this option than they think.
A lot of this is more possible in less expensive car-dependent Midwestern cities and mid-sized towns where houses aren’t as insanely expensive and there’s still a lot of preference for suburbs.
2) reorient your life around proximity as much as possible. Essentially, what can you do in your neighborhood instead of in a suburban strip mall that you have to drive to? Yes, walking or biking to grocery shop most of the time at the natural foods coop down the street is more expensive than driving to the suburban supermarket. Still doesn’t add up to a car payment for a “reliable” new car.
Sometimes my wife and I will drive to trendy destination bars or restaurants, but more often we go to one of the good enough places in the neighborhood we can walk to. We are members of a nonprofit theater near downtown that we can bike to instead of driving to a suburban mall to go to an AMC. Our gym is biking distance. Biking together to is built in to date nights in the warmer half of the year. I feel like this is where millennial optimization culture really harms us. It’s more important to go to the best trendy restaurant than it is to go to the good enough restaurant in your neighborhood, which cements car culture as the norm, since the best often requires driving
And, uhhhh, controversial opinion, we drop friends and acquaintances in our neighborhood once they move out to some farflung suburb unless they’re willing to come to the city to see us. (Unless we are really really close.) generally people who move to suburbs hate when this happens, but most acquaintances are not worth driving 30min for. It also demonstrates we have very different values. This is why we’re all lonely, btw, bexause we’re trying to get blood from a stone when it comes to social enrichment and closeness when it always involves driving. (I didn’t expect any of our neighbor friends in St Paul to remain close when we moved.)
Once we reoriented our daily lives to focus on doing as much as possible locally, we ended up driving less.
3) spend your new car money on an e-bike. As a fairweather biker in cold and snowy Minnesota, getting an e-bike has eliminated 75% of my in-town car trips for half the year.
PSST: if you think this won’t work for you because you have kids, I see tons of parents in my neighborhood with cargo bikes with toddler seats.
4) learn how to use and tolerate the bus system even if you drive. This is a huge one. I used to bus commute to downtown from a streetcar suburb. So many people use public transit when they are young and immediately forget about it as soon as they are car dependent. The justification for an expensive new car is often “I absolutely need a reliable car to get to work because there is no other way”. However, if you live in a less dense part of the city and/or a streetcar suburb, this is absolutely untrue. Most people are just so used to the convenience of a car that they cannot even fathom the inefficiency of the bus. I don’t deny the bus can suck, but if it’s not your main method of transit, you can rely on it a little more and just accept the inefficiency as temporary.
My shitty 2006 car is out of commission for repairs for a few weeks every year. If my wife needs her car, I will just take the bus. It’s not amazing and it requires advanced planning, but it’s a perfectly serviceable solution a few weeks per year. Instead of framing this as “I must have a reliable car because the bus sucks”, I frame it as “I can have a cheap old car that occasionally needs work because the bus is a viable if a cheap alternative.”
This works well if most of you moved your daily activities into your neighborhood.
“Most American households have two cars. So we’re talking about $20,000+ per year just to get around.”
This is where using averages creates a fantasy version of reality. I live in a town that requires you to drive. I also own 3 vehicles (old, bought very used w no financing), and I would estimate that between fuel, maintenance, and insurance, I’m somewhere around 2k/year on the high end (unless something catastrophic breaks). If my neighbor finances a 100k Land Rover and we average out our expenses, my shit is gonna look MUCH more costly. I know that’s not the point of your article, and maybe I’m more of an outlier, but hard data usually omits real world circumstance. Nuances are worth exploring too (and fuck do I often wish I lived somewhere walkable)