I take the commuter train to get into class twice a week. Which requires, on occasion, that I intimately elbow and bump with the 9-5 professional crowd who trek into the city everyday to work their office jobs. One month of riding with this crowd, on early morning trains, would be enough to make anyone start thinking about early retirement.

Today, I noticed a 2009 or 2010 Jaguar XJ was parked right next to my old sedan. I was appreciating the form of the vehicle when a thought occurred to me. I then looked around as I walked over to the station platform through the inch of snow that had fallen last night. I spotted a recent-model BMW 7-series, and I thought I spotted a newish Range Rover, but I couldn’t be bothered to get close enough to be sure.

Then I did some quick math. Those cars, new, sell for somewhere between $70k and $110k. Taking the commuter train into Boston five times per week costs about $4,160 per year, plus most people also need a short subway ride after the train, which would run another $676/year. Parking at the train station runs around $1,300/year, for 5 days per week for the cheap spaces, and $2,200/year for the garaged spaces. Insurance on cars like that must run somewhere between $2k and $4k per year. Fuel costs are tough to estimate. Most people who take the train live within about 15 miles of it, otherwise they would just drive into the city because the station is too far out of their way. Let’s just guess that they live 10 miles away, that’s 20 miles/day, 100 miles/week just getting to and from the train station which, at 18-25mpg with gas at, say $3.30/gallon, fuel costs must run them somewhere between $700 – $1,000/year. Maintenance on those cars isn’t cheap, though they’re new so there shouldn’t be too many needed repairs. Let’s just peg oil changes, tire wear, etc at a modest $400/year. Unless they paid cash for their cars (doubtful), there will be interest that needs to be paid, which ought to range somewhere between a promotional 3% APR to a more likely 6.5% APR which, after making a modest down-payment for the vehicle would put the cost of one year’s worth of interest somewhere around $2,100 – $6,500.

That puts these people’s commuting costs at $81k – $128k for the first year they own the car.

Which means, there are some people frugal enough and some people extravagant enough, that the frugal one could retire merely on what the extravagant one pays just to get to and from his job everyday for a year.

Now of course, people tend to trade in their cars every few years and so the annualized costs, over a couple of decades say, works out to less than $81k – $128k. But it still stuns me that, just in order to get to their job, some people purchase a machine that costs more than the capital required for a frugal retirement.