Purpose

I started this blog with the goal of documenting our creation of enough passive income by July 2012 to achieve true financial freedom - a great lifestyle funded by money that comes in whether we work or not.

We didn't make it...at least partially because I now believe that work provides a lot of benefits both to the one working (physically, mentally, emotionally, and even spiritually) and also to the one being served.

I still am very interested in investing and the world of finance, so I will try and pass along any interesting opportunities I see, but I have a newfound love for active income as well.

Saturday, May 31, 2008

Improving Gas Mileage - Installment 3

This one is near and dear to my heart since I sell synthetic oil. In fact, the (used) car I just recently bought, one of the first things I did was change the engine and transmission oil over to synthetic.

As I mentioned before, I sell AMSOIL, so take that into account when reading this. If you are interested in learning more about AMSOIL specifically, I am providing a link here and at the bottom of the page. Consider yourself warned :)

Improvement #3 – Use Synthetic Oils

Going from conventional oil to a high-quality synthetic oil should give you a 1-4% improvement in mileage for each component (engine, transmission, and differential) that you put it in. This is based upon testing as well as my personal experience with AMSOIL. If you change all three (assuming you have a differential), I would expect about a 5% improvement.

Let’s talk about each component individually:

Engine oil

Potential savings: $26 – 118 (1 – 4.5% improvement)

Cost: No extra (for most) with AMSOIL up to $100

Cost of my recommendation:
- $0 (most people spend less with AMSOIL)


This is discussion is going to refer mainly to AMSOIL synthetic oils for several reasons:
1) I think it is the best.
2) It is the synthetic oil I am most familiar with.
3) The one-year/25,000-mile engine oil change guarantee (for personal vehicles) makes it by far the most economical option for synthetics.

Other synthetic oils will give similar benefits (though most not as much), but AMSOIL has the most independent testing done on it that I know of, and they really focus reducing friction in the engine, which leads to better fuel economy (as well as better engine protection).

I started using AMSOIL when my wife and I were each driving 25,000 to 30,000 miles a year. To find out I could change oil once a year instead of every month or two and save money at the same time made me ecstatic (well, ecstatic for an engineer). I couldn’t believe more people (like me) hadn’t heard about it, so I started selling it as well.

Starting from “scratch”, makers of synthetic oil can design it to do almost exactly what they want (if the maker chooses to do that instead of just maximizing profits), making it better at all of the jobs oil does.

As I alluded to above, synthetic oils generally reduce friction in the engine by not having the various contaminants in traditional motor oil. Reducing friction improves fuel economy by having less of the engines energy wasted overcoming friction. It also has the nice side benefits of reducing engine wear and generating less heat.

The automakers are finally starting to catch on (seeing that it helps them meet average fuel economy standards mandated by the government): many cars now come with and recommend semi-synthetic or full synthetic oil changes.

The average full synthetic oil is better than the average semi-synthetic in terms of fuel economy (no contaminants being better than less contaminants).

According to a May 2008 Lubes ‘n’ Greases article, you can also improve fuel economy by going from 5W30 or 10W30 to 0W30 (0.3 to 1.0% improvement, respectively) or 5W20 to 0W20 (0.5% improvement). 0W30 or 0W20 oils are typically only available as full synthetic oils.

Without going into technical detail, in a high-quality synthetic, there is no disadvantage in switching to the 0WXX oils.

Just the other day, I talked to a mechanic that sells AMSOIL. He had just installed AMSOIL engine oil (5W30) in his wife’s Pontiac G6 (two years old, about 40,000 miles). The mileage went from 28.5 mpg to 29.4 mpg using the mileage computer. That is a just over 3% improvement (right in the range we would expect) and will save her over $70 per year in gasoline. At the same time, it costs no more (per mile) for her oil changes.

My recommendation:

Use AMSOIL 0W30 or 0W20 premium synthetic motor oils. You should be able to get the oil and have it installed for around $100 and it lasts a year. For someone driving 15,000 miles a year this compares to 5 oil changes at probably about $30 each, for $150 total, not to mention the time involved to get it changed.

Differential fluid

Potential savings: $175 – 700 (1 – 4% saved for 100K miles)

Cost: $75 $25 for fluid
$50 to get it changed


To me this is a no-brainer for vehicles that: 1) have a differential, and 2) do not have synthetic fluid from the factory. Most newer vehicles have synthetic, but check your manual – if it states that synthetic is required, it probably had it from the beginning; otherwise, probably not.

Note: If you are changing over from conventional to synthetic and you had leaks at the differential, you will want to get the seal replaced at the same time. This would likely be done anyway, but synthetic fluid is expensive to let leak out!

If you do have synthetic from the factory, make sure you change it when required with something optimized for superior fuel economy.

My recommendation:

If you have a differential, and it does not have synthetic fluid in it, get it changed now. If it has synthetic, just make sure you get a synthetic optimized for fuel economy when the manual recommends changing it.

Transmission fluid

Potential savings: $175 – 700 (1 – 4% for 100K miles)

Cost: $220 (automatic) $120 for fluid (typical car)
$100 to fully flush out
$75 (manual) $25 for fluid
$50 to get it changed


Cost of my recommendation:
$50 – 150 (automatic – at next service)
$75 (manual – if not synthetic already)


The potential gas savings in the transmission are similar as for the engine and differential, but the cost for changing over an automatic transmission is significantly greater.

In my view, automatic transmissions are still the least reliable part of the drivetrain, so the protection a good synthetic provides against wear can help reduce transmission problems down the road. This is another good reason to change your transmission over to synthetic.

Most automatic transmissions hold 10-15 quarts, and a good synthetic transmission fluid will run around $5 to 6 per quart more than normal transmission fluid.

Note that there are two different transmission services – 1) drop the pan, clean the filter in the pan, then top off the fluid, or 2) flush all of the fluid out (after dropping the pan and cleaning the filter).

The first usually changes only about 1/3 of the fluid in the transmission, so don’t mistake it for a full fluid change. When switching to synthetic, you will want to do the second option – the full flush – to get all of the old fluid out.

Because of the expense of completely changing all of the transmission fluid, I recommend waiting until your next scheduled full fluid change so that you are only paying to upgrade the fluid. If your manual only recommends the first option above, I would substitute the full flush for the next service.

Again, I have the most confidence and experience with AMSOIL, so that is the fluid I would recommend (surprise, surprise). I have not seen significant test data published by the other manufacturers that would allow me to recommend them as well, but there may be other good ones out there. AMSOIL has their own 100,000 mile guaranteed drain interval for automatic transmissions, or they say to use the manufacturer’s recommendation if it is longer.

My Recommendation:

Automatic transmission – At the next scheduled transmission service (preferably the full change), go ahead and switch over to synthetic. The additional cost could be anywhere from $50 ($5 per quart times 10 quarts) to $150 (my $220 estimate for full conversion compared to $70 for a “typical” transmission service).

Manual transmission – Since the service is much cheaper (usually about $50 to change and $25 for the 2-3 quarts of fluid), I recommend doing this as soon as possible. As you can see, there is a very good payback on fuel savings (not to mention better protection for your transmission!).


As promised, here is a link to the AMSOIL store. Because there are lots of different kinds of fluids, feel free to call me at 816-896-6566 if you have any questions!

The next three don't require as much explanation, but are no less important. Stay tuned...