Giving Up the Car: How to Compare the Real Yearly Cost
Last checked November 2026. Offers and rules change: confirm with the provider before you rely on them.
Whether giving up the car saves you money depends on your own figures, not on averages. Add up what the car costs you in a full year, including the value it loses, then price the same journeys by taxi, bus and delivery. This page gives you the method; you supply the numbers from your own paperwork.
Why do the sums at all?
Most of us think of the car as costing "a tank of petrol now and then". The big costs are the ones that arrive once a year or not at all in cash: insurance, servicing, and the money the car quietly loses in value. A car that covers only a couple of thousand miles a year can work out at a surprising amount for each trip. On the other hand, if you live where buses are scarce, the car may still be the cheaper and better option. The only way to know is to write it down.
Step 1: what the car costs in a year
Find last year's paperwork or bank statements and fill in each line. Use real figures wherever you can.
| Cost | Where to find your figure |
|---|---|
| Insurance | Your renewal letter or bank statement |
| Vehicle tax | Your DVLA reminder or direct debit |
| MOT test | Last year's garage receipt |
| Servicing and repairs | Garage invoices. If last year was unusually cheap or dear, average the last three years |
| Tyres, battery, wipers | Receipts, spread over the years they last |
| Breakdown cover | Renewal letter |
| Fuel or charging | Add up a few months of card payments and scale up to a year |
| Parking and permits | Resident's permit, hospital and town car parks |
| Depreciation (loss of value) | What the car was worth a year ago minus what it is worth now. A free online valuation, or the price of similar cars for sale, gives a fair idea |
Add the column up. That is your yearly cost of keeping the car. If you would sell the car, note down separately what it would fetch: that is a one-off sum that could sit in savings or pay for a lot of taxi rides.
Step 2: what you actually use the car for
For two ordinary weeks, jot down every trip: where, how far, and whether you could have done it another way. Then add the occasional journeys that do not show up in a fortnight, such as hospital appointments, visits to family and holidays. Sort them into four groups:
- Could go by bus or train. With a free bus pass the bus fare is nil at off-peak times, and a Senior Railcard cuts most rail fares by a third.
- Could be replaced by delivery. The weekly shop, prescriptions and bulky items. See supermarket home delivery.
- Would need a taxi or a lift. Evening trips, places with no bus, days when you are carrying a lot.
- Could use a community scheme. Dial-a-ride or a volunteer driver; see community transport.
Step 3: price the alternatives
Now put a yearly figure on each group.
- Taxis: ring a local firm and ask the fare for your three most common trips. Multiply by the number of times a year you would make each one, there and back.
- Buses and trains: nil with the bus pass at qualifying times; otherwise the fare. Add the yearly cost of a railcard if you would buy one. Our railcard calculator shows whether it pays for itself.
- Delivery: the delivery charge or pass for your supermarket, multiplied up for the year.
- Community transport and lifts: the fare or mileage contribution the scheme asks for, or a fair amount towards a neighbour's petrol.
Add those up. That is your yearly cost without the car.
Step 4: compare, then look beyond the money
Subtract one total from the other. If going car-free is cheaper, the saving plus the sale price of the car is real money that can make taxis feel like a normal expense rather than a luxury. If the car is cheaper, you have a sound reason to keep it for now.
Money is only part of the decision. Be honest about these too:
- Safety and confidence. If driving has become stressful, that matters more than the sums. A driving assessment can tell you where you stand.
- Independence. Will you still go out as often? People who plan their alternatives before the car goes tend to stay more active than those who stop suddenly.
A halfway house
If you decide to stop: the practical steps
- Sell or transfer the car and tell DVLA, using the log book (V5C) or the online service on GOV.UK. DVLA refunds any full months of vehicle tax remaining.
- Cancel the insurance and ask for a refund of the unused part. Ask for written proof of your no-claims record in case you ever need it.
- Cancel breakdown cover and any parking permit.
- Apply for your bus pass if you have not already, and ask your council about taxi vouchers; see taxi cards and travel tokens.
Common questions
Is it really cheaper to take taxis everywhere?
For some low-mileage drivers in towns, yes; for others, no. It depends on how many trips you make and how far. That is why the method above uses your own figures rather than a national average.
I have a disability. Are there other options?
Possibly. Look at the Motability Scheme, the Blue Badge (which you can use as a passenger in someone else's car) and your council's taxi voucher scheme.
Do I have to tell anyone when I stop driving?
Tell DVLA when you sell or scrap the car, and cancel your insurance. If you are stopping because of a medical condition, DVLA will want your licence back; see eyesight and driving for the reporting rules.