Pay more to save more? Sometimes extra gadget features can save you money

Multi-point route optimization is not only cool -
it can also save you money

In yesterday’s article “One feature to consider before buying that new GPS” about multi-point routing, a reader suggested he’d “throw multi-point routing in there with bluetooth, fm transmitter, and the like” and that this feature only makes sense if you think it sounds cool and have extra cash.

But there’s a huge difference between multi-point routing and Bluetooth and an FM transmitter. To see why, you have to perform a cost/benefit analysis.

The features of any gadget fall into one of three categories:

• Features that you like and will use, but are either included or will cost you more.
• Features that you like and will use, but save you money.
• Features you will not use. If they cost you more, that money is wasted

Bluetooth and FM transmitters on a GPS are convenient, but tend to increase the cost of the device. In most cases there is no long term financial benefit in having them, so indeed, the only reason to get them is if you think they sound cool and have extra cash.

Multi-point routing in a GPS is very different for those who tend to have multiple destinations when traveling. Let’s say a route optimizing GPS can save you just five miles a week in travel. That’s about 250 miles/year.

How much does it cost for you to drive each mile?

According to the AAA, the national average cost per mile in 2007 was 52.2 cents – that includes depreciation and fixed costs as well. At that rate, route optimization will save you about $125/year. Even if you only include the cost of gas, you’ll be looking at savings of $20-$40/year depending on mileage and cost of gas. Given that a route optimized GPS such as Garmin’s 760 has a street price of about $150 over the least expensive available GPS, there’s an excellent chance that the upgrade will pay for itself during the life of the unit and even save you money in the long run.

Adding the convenience value to the mix, you can see why I won’t buy a GPS without multi-point routing.

And what about web based services that do route optimization? Those are generally targeted to business use and, unsurprisingly, are not free. Having route optimization built into your GPS is convenient for individuals and typically costs less.

This principle for evaluating features applies to any gadget, and I encourage you to use it when evaluating any purchase.