Out-of-pocket cost refers to the actual amount of money a person has to part with in order to go somewhere.  Out-of-pocket cost is a common reason why people don't feel like taking transit to go on a random trip every once in a while.

Consider this example: one day, many moons ago, one of my roommates announced that he was going to take the bus to campus that morning, just like me.

Him: How much does it cost?

Me: $1.60.

Him: Dude, I'm not gonna drop $1.60 just to ride the bus four blocks to campus!

Me: It's more like six.

My feeble distance-based reasoning did little to sway him (and would probably do even less now that the fare is $2.35, if it hasn't gone up again before you read this).  And who could blame him?  Dropping change every time you have to go somewhere adds up quickly.  Especially if you can just hop in your car and go somewhere for free, riiiiiight?

Well . . .

Out-of-pocket cost can be deceiving.  Because it costs nothing to actually get in the car and drive away, we all do it more than we should.  And then we run out of gas sooner than we thought we would, and then we buy more gas than we thought we would, and then we realize we are out of money, and then we feel bad about it but we can't quite place the reason why.  And gas is only one of the expenses we pay; the actual car payment, insurance, emissions, random repairs, not to mention time lost sitting in traffic and the stress of commuting significant distances by car all contribute to the actual cost of driving.  But, still cheaper than paying for a bus every time, especially if it's going to take longer to get there on the bus, yes?

Well . . .

We humans are habitual creatures.  We try to make it as easy as possible for ourselves to continue things the way they are.  That means that, in a largely automobile-oriented culture, most people experience a higher out-of-pocket cost to take transit than they do to drive.  But there are things that can be done to reduce the out-of-pocket cost to take transit.

Apart from actually, legitimately, being cheaper than driving, a bus pass has the advantage of just being there every time you want to hop on a bus (or train, etc., etc.).  If you feel like going four blocks, you'll go four blocks, because you can.  Taking transit stops becoming an event and starts becoming part of your lifestyle.  Even if you don't take transit everywhere, there are other ways to make paying for it more convenient, like being able to pay with a debit card, having a prepaid card or a punch card, or having a free-fare zone downtown.  The less you have to think about paying, the less painful it is to pay.  And if paying for transit is easy for you, you might just save some money.


  1. Always maddening that no one counts the cost of roads in the cost of auto travel. More informed people will claim that gas-tax costs cover it...which is untrue. The Federal Highway Trust fund (funded by gas taxes) has been broke for years, and Congress keeps refilling it out of transfers from the General Fund.

  2. The difficulty comes in wanting to use both. The out of pocket cost of driving a car is certainly higher than riding a bus, but for most people it's just not practical to take transit everywhere, and buying a car is a large sunk cost. If you are already paying for the non-variable vehicle costs, the cost per mile of a car tends to be lower than a single transit fare.

    TLDR: Lowering bus fares increases ridership.