One of the most perpetual lies people tell each other is that you have to spend money to make money. Many entrepreneurs, for example, believe that they should invest a lot of money and effort into their business before it will take off even though there’s no empiral evidence to support this claim. While I’m a firm believer that you shouldn’t spend money to make money, I am going to do so anyway. In fact, I already did.
The image at the top of this post probably spilled the beans already, but I invested in a brand-new road bike. Of course, a bicycle is just as much an investment as keeping a balance on your credit card. The two-wheeled technical marvel depicted above requires a running tab at the local bike shop to keep up with maintenance alone, for example.
Still, I consider my
shiny matte black new Trek Madone 2.5 an investment. It’s an investment in myself, in my health and in my hobby.
I’ve written before about expensive hobbies and non-essential spending, so I’m not going to rehash the arguments brought up in that discussion. However, it’s safe to say that putting money towards avoidable expenses like hobbies is an essential part of financial independence because they help you to fully enjoy life, at least in my book.
Another topic I’ve touched upon earlier during a discussion on the advantages of living car-free is the benefit of bike usage. Indeed, riding your bike instead of burning fuel to go places leads to improved health through better physical fitness – not to mention the huge savings.
It’s true that a hobby or two and good health are major assets to have on a personal level, but that still doesn’t make my new bike an investment. The return on money spent isn’t monetary in value, but rather a difficult to grasp notion of life enjoyment.
Enter my employer.
Because the Belgian government wishes to incentivise commuters to jump on public transportation networks and cycle to work, our legislative has since long introduced a system that many Belgians make good use of: a bike renumeration. Basically, you can apply for a fixed fee for each kilometer you ride to work on your bike.
In my case the fixed rate is set at €0.21/km. While that doesn’t sound like much, keep in mind that my daily commute is about 65 kilometres both ways. That’s €13.65 each day I take my bike to work. Still not worth it? To put that number into perspective, I strongly urge you to read this post in which I explain how much I earn by the hour after taxes – spoiler alert: it’s less than €13.65.
Now, riding to and from work every day simply isn’t an option for me. There’s early and late meetings, telecommuting and bad weather, just to name a few things that would keep me from cycling to work five days a week. For my 2015 goals I have nevertheless set myself a target of at least 50 bike commutes. At the moment I’ll smash that number easily since I’m averaging two days already.
Let’s assume I manage to bike to work 100 times every year by factoring in holidays and the like. That’s €1,356 earned simply by peddling on a luxurious piece of kit rather than sitting on my lazy bum in the train.
Still not convinced?
That’s why I’ll be conducting this very experiment and report about it on my blog. Intuitively we all feel that a return of €1,356 on a €1,583 investment in the first year alone is a good deal. However, there’s recurring maintenance costs to take into account – and like I said, this type of bicycle requires a running tab even if you take good care of it.
Over the coming months I’ll report on both my expenses and the money earned from riding to work so you guys can follow along. That way maybe you’ll find that cycling to work is a good idea for you too if you have access to a similar renumeration scheme like I have.
Until then, I already consider this entire setup a win-win situation. On the one hand there’s a high chance that I’ll make money by biking to work, while on the other hand I could fall short but at least I’ll have reduced the overall costs of my previously expensive hobby.
As Charlie Sheen would put it, epic winning!