Don't be a dummy, Pay for Parking.

I’ve been towed twice over the past two years. I’m writing this down because I want to convince myself fully to just pay for the cheap cost. Using I my handy dandy finance knowledge it comes in handy to quantify using time-value-of-money calculations.

Option 1: Pay For Parking

• Payment = $125 per year (25 parking per year * 5)
• Interest = 3.5%
• Number of years = 2 years
• Future Value (what I would pay at the end) = 0
• Present Value (what I pay now) = ?

Option 2: Be A Dummy And Get Towed

• Payment = $160 per year
• Interest = 3.5%
• Number of years = 2 years
• Future Value (what I would pay at the end) = 0
• Present Value (What I pay now) = ?

What should you do?

• Opportunity Cost Option 1 =-$237.46 (This is better)
• Opportunity Cost Option 2 = -$303.95 (This is bad)

Don’t be a dummy, Pay for Parking.