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Big picture finances

Back in April I was thumbing through Consumer Reports' annual auto issue when I came across an article entitled, "Best Values: Small Cars and Family Cars Provide the Most Bank for Your Buck." No real surprise there, but always looking to reassure my value-seeking sensibilities, I continued on to read about road-test scores, predicted reliability ratings, and five-year owner-cost estimates — which is when it got really interesting.

On the next page was a list of 60+ cars with various data points (here's a similar article). The most compelling data to me was called "cost per mile." I quickly scanned till I found our two-year-old Honda Odyssey (which I LOVE and have NO problems whatsoever saying as much). Cost? $.71/mile. I remember thinking, "Man that's high." But then I went on with life and didn't give it too much extra thought.

The significance of this expenditure didn't dawn on me till the other day when we were carpooling with some folks to an out-of-town event in Frankfort, Kentucky. From where I live in Louisville, that's about 50 miles — i.e. $35.50...one way.

Yes, Consumer Reports' cost-per-mile factors in gas, maintenance, depreciation, insurance premiums, even sales tax. And it's based only on a five-year ownership. But for someone who hems and haws over spending $.99 on an iPhone app, it occurred to me that thinking about cost-per-mile could be revolutionary.

For instance, I often hop in the Odyssey (yeah, I could use our other car, but like I said, I'm the Minivan Man) and drive two miles up the road to the quickie mart for a Diet Coke. I now realize this is costing me $3.78/soda rather than the mere $.94 that I was rationalizing.

So I'm now thinking in terms of MPM (money per mile) rather than MPG (miles per gallon). Where we live, a trip to the grocery is not seven miles away, it's $4.97 away. And another $4.97 if I want to come back.

Okay, okay, I know — it's not technically "costing" me this at the time I'm driving. But it's roughly "equating" to this over the first five years. And yes, Consumer Reports is making some assumptions, so it's not 100% precise (Edmunds.com's True Cost to Own calculated the ownership operation to be $.58/mile).

So why bring this up? Because you and I often lose site of the big picture when we think about our finances.

We fall into the trap of "the-more-you-buy-the-more-you-save" sales (an oxymoron if I've ever heard of one — the more you buy the more you spend!). We hold on to a falling fund with a lot of our assets in it just so we don't get hit with a $50 early redemption fee. Or worst of all, we're stingy with our tithing on earth, even though we're promised eternal rewards in heaven. We would do better by keeping the big picture in mind.

So the next time your debating whether to buy a shirt that you only "kinda like" but it's 95% off (this is me nearly every time I go to Old Navy), or to drive an extra three miles out of our way to save $.02 on a gallon of gas, maybe you should stop and ask some questions:

• "Do I really need this?"
• "Can it wait?"
• "Is it part of my long-term plan?"
• "Am I being penny wise, dollar dumb?"

And most importantly:

• "Am I being a good steward of what's been entrusted to me by storing up treasures in heaven?"

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