Work from Home (Remote or Hybrid) Savings Calculator
Calculate the remote work cost savings when shifting from to mainly remote work
This Business Case outlines the one and five year benefits of changing from a job where you spend most of your time on-site, to spending most of your time working from home. This includes hybrid, or 100% remote. This in-depth calculator includes expenses related to public transportation, vehicle, household, food, child care costs, and even your time saved.
Option 1 is your ‘mainly on-site‘ baseline
This assumes you commute most days of the month at your on-site work location. It will outline the expenses required to commute for work.
Option 2 is your ‘mainly at home‘ (or remote work) comparison
Calculate savings for a 100% remote wok position, or a hybrid option. The benefits of this option will be compared to your current situation of working mainly on-site.
Use the Work From Home Savings Calculator guide below to understand the factors in the calculator. For a detailed calculator walk through, review this The Exhaustive Work-from-Home Cost Savings Article.
Remember to keep a copy for yourself by entering your email address at the bottom of the “Detailed Results” section.
Guide to the Work from Home Savings Calculator
General Information
- Days per Month when Working Mainly On-site: Site workers will work up to 20 days per month on-site, or more based on your job requirements or overtime. Capture your current on-site work days.
- Days per Month when Working Mainly from Home: Working remotely does not mean being 100% remote in most cases. For this item, capture how many days per month you expect to commute on-site.
- Daily Minutes Spent…: Capturing this information will help estimate and compare the amount of time you spend (or lose) when commuting on-site.
- One-time Setup Expenses: Working remotely allows you to create a productive home office space. Capture the related costs you spend to set up and optimize your workspace.
- Driving and Vehicle Details: This is where you can enter information about your vehicle (gas, electric, hybrid), whether you own or finance, the current value, and commuting distance. All of this information will be used to adjust the subsequent questions.
- Estimated Annual Maintenance Spend: With decreased mileage driven, vehicle maintenance is reduced and experiences a slower depreciation rate. This has a long-term financial benefit as vehicles age slower due to reduced usage, which preserves the vehicle’s resale value over time.
- Sales of your Vehicle (Do you still need it?): If you’re using your car less due to remote work, selling it could save you a lot of money. If you choose ‘Yes’ to the option below, input your one-time sale proceeds and any savings from removing a monthly lease or finance payment.
- Gas or Hybrid engine fuel costs: Enter the estimated gas price you expect to pay on average over the next five years, as well as the fuel efficiency of your vehicle. These costs will be a major part of your monthly commuting costs.
- Electric Vehicle Motor Costs: To estimate your cost of electricity for fully electric vehicles, you can capture the home charging costs, as well as the motor efficiency of your vehicle.
Public Transportation Spend
- Public Transit Passes and Transit Lots: The monthly or annual transit pass is necessary for those reliant on public transportation.
- Ride Share and Taxis: Use for the cost of ride-sharing services or taxis. These options come at a premium cost. By working remotely, there is no need to rely on these services for transportation.
Vehicle and Driving Expenses
- Vehicle Insurance Premium: As you transition to working from home, you should contact your insurance company and update your driving information. You may be eligible for a reduction in your insurance premiums, given the decrease in your annual mileage, which reduces the risk of accidents.
- Parking: In most downtown or populated office locations, employees often have to pay for parking in the company or other private lots.
- Tolls: Regarding tolls, we all enjoy the time saved and the smoother commute. However, those daily toll charges catch up with you at the end of the month.
- Annual depreciation rate: For depreciation, the make and model of your vehicle play a large part, as well as the mileage, condition, and keeping up with maintenance. This option is only calculated if you own or finance your vehicle. An average vehicle driving 15k-20k KM per year will depreciate at about 15%. If driving is reduced significantly when working mainly at home, consider using a lower annual depreciation percentage. The estimate is based on your work-related mileage as a % of your total mileage. That is why ‘personal use’ mileage is captured as well.
Food, Social, and Tech Spend
- Coffee and Beverages: People can reduce their daily coffee expenses by making their beverages at home, saving money, and helping the environment with reusable cups and spoons.
- Meals, Snacks, and Restaurants: With remote work, people can cook and eat at home, which is much healthier and can save much money in the long run.
- Wardrobe refresh: The need for a range of tailored suits, dresses, and formal shoes decreases when working remotely. As people prioritize comfort while still being professional, it’s a welcome break for their budgets.
- Dry Cleaning: You will benefit from this spending reduction if you used to dry clean your work attire regularly.
- Grooming Costs: Working in an office often leads to spending more money on cosmetics, haircuts, and grooming products. However, when working remotely, people feel liberated from these conventional grooming pressures which can contribute to overall cost savings.
- Internet or other tech subscriptions: When working from home more frequently, your job may require improving the quality of your internet or phone service to meet your work demands. If you need to improve them at your own expense, capture those differences here. You may benefit from those savings if your company pays or subsidizes your internet.
- Other activities / social: This option is left open to capture anything specific to your situation, such as going out for dinner or drinks after work, participating in social outings, etc.
Family and Child Care Spend
Many working parents struggle with the expensive cost of childcare services. However, remote work provides the opportunity to balance work and family responsibilities. Supervising children while working from home can lead to substantial savings on childcare expenses. This includes avoiding or minimizing before-school, after-school, daycare, and summer activities expenses.
Average Tax Rate
The last piece to consider is salary and taxes. For example, if your paycheck taxes average 30%. That means you must earn 14,285 dollars, then pay $4,285 in taxes (30%) to net out $10,000 and pay your commuting expenses. So, in reality, the new position will have to offer at least $14,285 over your current salary simply to break even. Capture your average tax rate to estimate your pre-tax benefits.