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17 ways remote working saves money – #8 might surprise you

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Many people know that remote working can save a lot of money, but have you ever wondered how much? I’ve researched the top 17 areas of savings for remote workers.

Transportation

One of the larger expenses for non-remote workers is the cost of transportation. Costs such as fuel, depreciation, parking, tolls, public transportation, and even commute time can all be savings for remote workers that can result in a lot of money.

Let’s review some of the top transportation costs that can be saved when you switch to a remote working lifestyle.

1. Fuel

Fuel can be a large cost for the average daily 9-5 commuter. According to research done by Global Workforce Analytics, 80% of employees cite the cost of commuting to their job as a top concern. Two-thirds of these employees would take another job to ease the commute.

I can personally relate to this one. I received an excellent opportunity in a nearby city where my commute went from 20 minutes to 1-2 hours (depending on traffic). 

At the time, my vehicle was a large SUV that loved gasoline…especially the premium kind. I mean, it really loved it. I had the choice to take public transportation (trains) to work and spend 4 hours (round trip) commuting daily for about $12 a day or invest $60 in gasoline every 3.5 days. It was less expensive to ride the train daily, but took twice the time. ($240 vs $480 respectively). 

Eventually, I realized my best choice was to get a fuel efficient vehicle, so I bought a hybrid.

Working remotely from your home office, as you can imagine, can save a significant amount of money.

Potential Savings: $480 per month, $5,760 per year

2. Automobile wear and tear (depreciation)

Commuting daily can cause a lot of wear and tear to your vehicle. A lot of people do not realize this is a cost that is incurred against the value of your vehicle over time. Based on a 2018 study by AAA called Your Driving Costs, they calculated the average annual cost of wear and tear (across many vehicle types) to be $3,289. This was based on 15,000 miles driven annually.

To estimate wear and tear on your vehicle, use this simple formula:

First step choose vehicle type/value

If you have a vehicle that doesn’t exactly fit any of these categories, just pick something that is close.

  • Small sedan – $2,268
  • Medium sedan – $3,580
  • Large sedan – $3,893
  • Hybrid – $3,068
  • Electric vehicle – $5,471
  • Minivan – $4,003
  • Small SUV – $2,927
  • Medium SUV – $3,714
  • ½ ton, Crew-Cab Pickup – $3,518

(based on 15,000 miles driven annually)

Second stepdetermine the per mile wear and tear cost

According to AAA, the average number of miles driven annually is 15,000. Divide the calculated value by 15,000 to get the per mile wear and tear cost.

  • Small sedan – $2,268 / 15,000 = $0.1512
  • Medium sedan – $3,580 / 15,000 = $0.2387
  • Large sedan – $3,893 / 15,000 = $0.2596
  • Hybrid – $3,068 / 15,000 = $0.2045
  • Electric vehicle – $5,471 / 15,000 = $0.3647
  • Minivan – $4,003 / 15,000 = $0.2669
  • Small SUV – $2,927 / 15,000 = $0.1951
  • Medium SUV – $3,714 / 15,000 = $0.2467
  • ½ ton, Crew-Cab Pickup – $3,518 / 15,000 = $0.2345

Third step determine the annual wear and tear cost based on the amount of miles you drive. 

Now that you know your per mile wear and tear cost, you can calculate your annual cost. Determine the number of annual miles you drive and multiply this by the per mile wear and tear cost. For example, I have a hybrid vehicle and I am expecting that I will commute 29,400 miles in a year to my day job (only counting the commute to my job at 120 miles a day). 

Expected annual wear and tear cost calculation:

29,400 * $0.2045 = $6,012.30

As a remote worker working from your home office, you would significantly reduce the miles you drive per year. In my case as a remote worker, I estimate I would commute locally an average of 5-6 miles a day to co-working spaces or coffee shops. This would put my annual commuting miles (based on 245 working days) at 1,470 (versus 29,400) and my vehicle wear and tear annual cost at $300.62. This is a commute wear and tear savings of $5,711.68!

My results aren’t typical as I drive 120 miles a day round trip to my day job, but I am sure I am not the only one in this boat as employees cite commute costs as one of the top reasons they choose to remote work.

Potential savings: $475.98 per month, $5,711.68 per year

3. Parking

Though many employees commuting to jobs where parking is free, some employees in larger cities either pay for parking that is reimbursed or employers cover paid parking spots as a benefit to their employees.

According to Internal Revenue Service code Parking Expenses for Qualified Transportation Fringes Under § 274(a)(4) and § 512(a)(7) of the Internal Revenue Code, parking expenses are no longer tax deductible for employers. As a result, it is highly likely that this common perk will end up costing commuters.

It’s tough to say how this legislation will affect employees who have employers that have paid parking covered as a benefit. We can assume that this cost will be passed on in some shape to employees.

Potential savings: Too soon to tell.

4. Tolls

I have personal experience with the cost of tolls on my daily commute. I average about $60 per week in toll expenses in my 2-hour round trip commute. For those self-employed, if tolls were incurred as a business related commuting expense, they can generally be deducted from taxes. If you are traveling to your job as your regular daily commute, tolls are not tax deductible.

Potential savings: $260 per month, $3,120 per year

5. Commute time

The most finite resource we have as human beings is time. We often don’t think of time in terms of costs. What is an hour of your time worth?

One of the benefits of working for yourself is you get the opportunity to define how you use your time. If you invest more time into a project, you could potentially yield more income. You’re completely in control of how you use your time.

If you work for an employer on a salary, for example, you can’t typically work more hours to earn more money. It doesn’t matter if you invest 8 hours or 10 hours, you’ll still earn the same amount per day. 

So what is the value of your time? $50 an hour? $70 an hour? What could you accomplish if you had your commute time back to increase your income?

Potential savings: not quantified.

Calculate your own commuting costs:

Commute Calculator

Food

Many people don’t realize the true costs of eating out. Below, we analyze two areas of cost savings for remote workers as it relates to food.

6. Lunches Out

Going out for lunch is as much a needed mental break from the workday as it is a necessity for some. Eating out can become expensive and the remote worker eating at home can save a lot of money.

There are about 260 work days in a year. Americans receive an average of 15 vacation days a year, which leaves us with 245 working days. At the extreme, let’s assume we eat out all 245 days. The average commercially prepared meal costs $13 (in the US). Annually, we will have spent $3,185 on lunches. That’s roughly $265/month.

The average home-cooked meal costs around $4 for groceries. That is a $9 savings per meal which equates to saving $82/month and $980/year.

If you were to invest $82/month for 30 years at a 12% annual return (historically, the 30-year return on the S&P has been 12%), this would be $265,967.

Keep that in mind the next time you head out to Chipotle for lunch!

Potential savings: $984/year

7. Take Out Dinner

Along the same lines, according to the Bureau of Labors Statistics, the average US household spends $3,008 per year eating out. I’ll spare you the investment math as you can apply the same logic as above, but if you consider the average home-cooked meal cost at $4, you will realize a savings of  $1,968/year.

As you can see, there is a large cost benefit to giving you more time to prepare home cooked meals as a remote worker.

Potential savings: $1,968/year

Health

Maintaining good health is really important. As a remote worker, you have the opportunity to work in a reduced stress environment. As such, you can realize cost savings from living a healthier lifestyle.

8. Mental health costs

Stress is a common issue related to workplaces. Whether you’re trying to balance your work and home life or responding to the demands of the job, stress is hard to avoid. 

I researched this topic and found some surprising statistics. The data is a bit out-dated (2015), but I can imagine it hasn’t fluctuated much.

Workplace stress causes a staggering 120,000 deaths and nearly $190 billion in healthcare costs annually. Check out the research here.

As a remote worker, I have to imagine workplace stress is lowered substantially which should result in a savings.

Potential savings: Not quantified.

Finances

As a remote worker, there are areas in your financial life where you may be able to realize cost savings.

9. Tax deductions

If you aren’t taking a standard deduction on your taxes, you may have the opportunity to deduct money on your taxes through the home office deduction.

You can qualify for this deduction whether you reside in a single-family home, an apartment, a condo or a boathouse. Temporary lodging, such as hotels, don’t qualify.

Also, your home office must exclusively be used for business purposes. For example, if your office is also your kid’s toy room, this is not eligible. Your residence must be your principal place of business. You can obviously meet clients elsewhere, but your home office must be used for administrative and business purposes to qualify.

To determine your deduction, you have two options: the simplified option and regular method.

The simplified option allows for less record keeping. To calculate, you would multiply $5 per square foot (maximum 300 square feet). In addition, you can itemize other home-related expenses on Schedule A. With the simplified deduction you cannot deduct depreciation. There are other requirements about the simplified method you can read about here.

With the regular method, you can deduct actual direct expenses from your business such as repairs and other expenses you would deduct on Schedule A. In addition, you can deduct indirect expenses such as mortgage interest, insurance, home utilities and general home repairs based on a percentage of your home you use for business. Learn more about the regular method here. 

My advice is to find a tax professional to review which option is best for your situation.

Potential savings: Not quantified.

Time

Time is precious. It is a finite resource and your time is worth something. Below, we discuss ways you can save time that can then translate into more cash in your pocket.

10. Personal time

Do you put a value on your personal time? By working remotely, you can free up a bunch of personal time. Think about the time sacrifices we make to have a 9-5 type job. We waste time commuting to our jobs, attending company events, coworker happy hours, baby showers, and the list goes on. 

At the end of the day, every hour we spend working in the 9-5 trap is an hour wasted. It doesn’t matter how much effort you put in to it, you will still have a biweekly paycheck deposited to your account for the same amount as the last week.

By escaping the 9-5 and remote working, you save a bunch of time to further your hustle. As the cliche goes: time is money.

Potential savings: Many hours a day.

11. Starting a side hustle

Following along with the last point, the freedom and time savings you gain by remote working will allow you to start a side hustle. Imagine if you had an extra 3-5 hours a day to spend on whatever you wanted to spend. What could you accomplish with those additional 25 hours a week? Could you create another income source to allow you to earn and save more money? 

Potential savings: The sky’s the limit

12. Doing your own yard work

According to improvenet.com, the average cost of lawn care is $61 per cut. In the summer months, this can end up being a weekly expense that can end up costing $200-$300/mo.

Call me crazy, but I am one of those guys that actually likes to cut the grass. As a 9-5 commuter, I recall not having the time to do it, though.

Potential savings: $200-$300/mo, $2400-3600/year.

13. Housekeeping

Paying housekeepers is born out of necessity, laziness or convenience. Maybe it is a combination of a couple of these. Regardless, as a remote worker, you will have more time to do your own housekeeping.

According to research done by ThumbTack.com, the average cost of house cleaning for a 1-bedroom apartment is between $80-$110. A 3-bedroom 2000 square foot house can range from $150-$250. Do this a couple times a month and you are racking up some serious dough!

Potential savings: As much as $500 per month, $6000 per year.

Miscellaneous

Below, we’ll discuss other ways where you can save money in the remote working lifestyle.

14. Coupon clipping

As we’ve highlighted several times in this article, remote working will save you precious time during your week. That being said, you may be able to find more time to clip coupons to save yourself extra money on groceries.

Potential savings: Not quantified.

15. Clothing costs

Many offices have a dress code that includes business or business casual dress. Maintaining your clothing to meet your employers dress code can be quite expensive. According to the website FirstQuarterFinance.com, the cost to dry clean an outfit can range from $4-8. One weeks worth of clothing can cost as much as $40.

In addition to dry cleaning, the office environment often has the “dress to impress” mentality where buying the latest outfit is important. Clothes have a finite lifespan and it’s important to buy new outfits from time-to-time. This, as you know, can get quite costly!

As a remote worker, you don’t always need to dress to the nines. Throw on your PJs and get to work. Save a lot of money by not having to buy expensive name brand clothing.

Potential savings: Dry cleaning savings as much as $2000 per year

16. Cost of living

Cost of living as a remote worker is an interesting paradox. In normal jobs, you are bound to the geographic area where you reside. This determines your cost of living. If you live in Seattle, WA, you work in Seattle where the cost of living is high and wages match. If you live in Indianapolis, IN the cost of living is lower and wages match.

As a remote worker, you could be living in Chiang Mai, Thailand with a remote job in New York City. The cost of living in Chiang Mai is 50% less than NYC. If you were able to earn NYC wages living in Chiang Mai, this would be an incredible savings!

Potential savings: Not quantified.

17. Childcare

According to the National Association of Child Care Resource & Referral Agencies (that’s a mouthful), the average cost of center-based daycare is $11,666 per year in the US. 

As a remote worker, you have the opportunity to provide your own daycare from your house. This is an attractive proposition for most home workers as they not only save money, but they also get the opportunity to be a part of raising their own children.

Potential savings: As much as $11,666 per year.

Conclusion

We discussed 17 different ways to save money as a remote worker:

  1. Fuel
  2. Automobile wear and tear (depreciation)
  3. Parking
  4. Tolls
  5. Commute time
  6. Lunches out
  7. Take out dinner
  8. Mental health costs
  9. Tax deductions
  10. Personal time
  11. Starting a side hustle
  12. Doing your own yard work
  13. Housekeeping
  14. Coupon clipping
  15. Clothing costs
  16. Costs of living
  17. Childcare

There are real costs to being employed in the rate race. From commuting to your own personal time, it all adds up. As a remote worker, you have the opportunity to save tens of thousands of dollars.

Comment below ways you save money as a remote worker that I missed. I would love to hear some more ideas!

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