Jump to content

Vehicle Dollars and Sense

Vehicle Dollars and Sense

SGCM_editorial

3,979 views

blog-0608397001394696546.jpg

blogentry-129174-0-31701200-1394696582_thumb.jpgBuying a car in Singapore is both exciting and nerve-racking, for the joy of having your own set of wheels is accompanied by the toil of paying for it by instalments. Before you sign on the dotted line, think carefully about these:

 

THE RIGHT MACHINE

Buy the vehicle you need and not the one you want, because the latter usually ends up costing you more than it’s worth. It doesn’t matter if you’re a petrolhead – if you have two toddlers, for instance, it’s more practical to get a saloon instead of that sporty coupe you’ve been eyeing.

 

BUDGET CONSTRAINTS

According to a financial consultant who spoke to Torque, you should allocate no more than 35 per cent of your monthly income to servicing loans. Assuming that 20 per cent of your salary goes towards your home mortgage, you’re left with just 15 per cent for your car loan. So if you draw $3,000 a month, your monthly car instalment shouldn’t exceed $450.

 

‘HIDDEN’ COSTS

These motoring-related expenses aren’t obvious upfront, but definitely make a big impact on your wallet. Parking, petrol, road tax and motor insurance can be a drain on your finances. For example, year-long season parking in an HDB multi-storey carpark would cost $1,080 ($90 x 12 months). That sum alone is more than the annual road tax for a 1.6-litre petrol car.

 

TEN-YEAR TEMPTATION

Although it appears more affordable, choosing a 10-year, 100 per cent car loan is actually a decision you can ill afford. Zero downpayment means a larger loan quantum that takes longer to repay, and the total interest in the long run will be higher. Car buyers should also be aware that longer loan tenures mean that their ride will be in negative equity for a longer period.

 

This article was written by Jeremy Chua, writer for Torque.




4 Comments


Recommended Comments

Earning 3k and only paying $450 per month for the car loan? Hardly anyone does that. I know a guy who earns $2.8k and has to pay $800 monthly for his car. That's without his other miscellaneous expenses. Most people stretch themselves super thin. That explains the recent increase in the number of cars for auction.

 

I think the 100% loan crap is no longer relevant so why is it even being brought up? Unless you mean in-house loans.

Link to comment

Most Singaporeans are not able to afford a car if we are look at this "formula".

 

This seems like a old article, Nowadays with such extravagant COE prices, where can you still find 400/mth installment.

 

The "convenience" that we are paying is really expensive.

Link to comment

Other than all these, another important aspect to consider is whether to buy new or used car.

 

Lots of people are fixated on only buying new, which i think is quite silly. Buyers should always compare both new and used when making purchase decisions.

Link to comment

Something wrong with the title. "Vehicle Dollars and Sense" should be changed to "Vehicle Dollars don't make sense". Now this makes sense

Link to comment

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • Godzilla Minus One: Surprisingly emotional and poignant

    When one thinks of Godzilla movies, one imagines an oversized amphibious dinosaur generating a terrifying heat ray from its mouth and fighting with other oversized monsters. Meh, nothing special, right? Wrong. Here’s why Godzilla Minus One should be an action movie you should definitely catch. In this version, the timeless clash between monster and man is once again set against the tumultuous backdrop of post-war Japan. But, unlike typical action films that dive headfirst into destruction a

    chrissyc

    chrissyc

    Are forums outdated? I try to find out by asking AI

    Is your boss asking you to explore and learn how to use AI to improve the quality and efficiency of your work? Yup, you aren't the only one in that boat.  Whilst exploring new AI tools, I figured: Why not use it to answer some burning questions that I have? This time, it was about whether forums are outdated. Yes, forums like this one that we are on. I remember how before social media became popular, and before apps like Carousell existed, forums were where I chatted with others t

    Ready? Steady? Slow!

    Have you ever watched on of those baby crawling races? They are hilarious. I watch a lot of NBA, and sometimes they have these races as a halftime entertainment. And its hilarious because unlike most athletic races, there's an inherent unpredictability and chaos to these things. They get distracted, they get bored, they get tired. Babies doing baby things, you know.  Well, England thinks it can one-up the absurdity of racing: Introducing to you, Snail Racing.  It seems almost

    bobthemob

    bobthemob

    In a hyper-connected world, your physical presence is more important than ever

    The advent of apps and the Internet have revolutionised our ability to connect instantaneously. From social media to video calls to messaging apps, our capacity for real-time communication is unprecedented. However, it seems that the more hyperconnected we are online, the further apart we're growing in real life. Experts' Consensus Doctors, scientists, and specialists have all reached the same conclusion: Staring at our devices causes us to drift further apart – a trend I've obser

    jeresinex

    jeresinex

×
×
  • Create New...