Can you afford a car?

HondaJG

Senior Member
Joined
Sep 17, 2018
Messages
1,542
Reaction score
1
Jin power man. My annual slightly under 100k also don't dare dream of a car
Best estimated calculation is about 75% to 85% of your monthly salary will be feeding the car, if your take home is 2.5K at possible max loan.

But whether 90% loan, I am not sure. Local ruling is only 70% for Mitsubishi Attrage based on OMV.

https://www.theonlinecitizen.com/20...ome-do-you-need-to-afford-a-car-in-singapore/

https://dollarsandsense.sg/much-earn-singapore-think-buying-car/
 
Last edited:

sinicker

Master Member
Joined
Jan 20, 2007
Messages
4,412
Reaction score
274
Looking for advice from ppl who’ve seen and experienced more.

Will a take Home of 5.5k (excl. 2-400 take home OT) between my gf and I be enough for the upkeep of a car? Looking at the cerato or Elantra. Considered grab before, but getting one from where we work is a little difficult (Deep inside Tuas).

Assuming,
Dp = 50k
Loan = 30k
Petrol = 200
Road tax = 60
Parking = 120
Insurance = 100
Maintenance = 50

Some background, we save 3.2k a month, and are planning to get a house in 2-3 years time, with the first kid in about 5 years. A car will allow us to sleep in an hour more in the mornings and get home 30mins earlier. Daily commute is about 80km two-way. We work 15mins apart, so pickups and drop offs are no issue. Road condition not so good around these parts, so I expect the maintenance costs after the first 3 years to go up.

What do you guys think?

Be like me. Settle house first, enjoy the house with the two of you exclusively first... Once she's pregnant, buy a car. Don't worry, a lot of time to enjoy driving. I'm on my 3rd car now, 5 yrs of driving.
 

Average

Banned
Joined
Apr 14, 2012
Messages
29,037
Reaction score
311
Single fresh grad take home $5k cash per mth...

Can buy Elantra?

Need how much down pay?

Can I opt for high mthly repayment ($3k per mth) so can clear fast?

Wat I need to take note of when bargaining at showroom? First time buy car paiseh. Thanks
 

HondaJG

Senior Member
Joined
Sep 17, 2018
Messages
1,542
Reaction score
1
Single fresh grad take home $5k cash per mth...

Can buy Elantra?

Need how much down pay?

Can I opt for high mthly repayment ($3k per mth) so can clear fast?

Wat I need to take note of when bargaining at showroom? First time buy car paiseh. Thanks
depends on OMV of the new car...
Below 20k, 30% down-payment of the purchased price.
Above 20k, 40%, down-payment of the purchased price.
 

babyjyo

Member
Joined
Feb 27, 2009
Messages
275
Reaction score
23
Single fresh grad take home $5k cash per mth...

Can buy Elantra?

Need how much down pay?

Can I opt for high mthly repayment ($3k per mth) so can clear fast?

Wat I need to take note of when bargaining at showroom? First time buy car paiseh. Thanks

yes, you can buy the car. you would also need to factor in fuel, insurance, parking and maintenance. But, will you have enough to cover your other personal expenses? the loan period is up to you to define (max 7 yrs)
 

Average

Banned
Joined
Apr 14, 2012
Messages
29,037
Reaction score
311
yes, you can buy the car. you would also need to factor in fuel, insurance, parking and maintenance. But, will you have enough to cover your other personal expenses? the loan period is up to you to define (max 7 yrs)

I dun have any leisure .. just spend on food n investments, which can cut
 

Average

Banned
Joined
Apr 14, 2012
Messages
29,037
Reaction score
311
Oh I read that mas has regulations to limit loan repayment not more than half of income....
 

babyjyo

Member
Joined
Feb 27, 2009
Messages
275
Reaction score
23
I dun have any leisure .. just spend on food n investments, which can cut

will suggest that your loan period be of between 5 to 7 years. one main reason is that the loan interest for cars is quite low when compared to other loans. free up the cash for other investments and build up your cash assets since you are young (you might need them for housing and marriage).

discuss the financing options with a sales advisor, where you will get the installment sum. but do remember to factor in other costs such as parking, road tax, insurance and maintenance (even though car might have free servicing for a while, there could be additional maintenance like paint protection, car washes, upgrades and modifications, fines, erp, and replacement of parts not covered by servicing or warranty). perhaps, you might need at least 2k a month to maintain a car.
 

HondaJG

Senior Member
Joined
Sep 17, 2018
Messages
1,542
Reaction score
1
Once in a while, a forumer will appear with details about his salary and expenditure and seek the advice of fellow HWZers about whether he can afford a car.

The answers will predictably fall into four categories.

(1) "Wah, you earn so much, can afford any car you like" (for any salary above $2.5k)

This type of answer is usually posted by non-working forumers like students or those serving NS, who think that anything above $1k is a lot of money.

(2) "I like honda civic type r because chio. u shld buy"

This type of answer is useless for budgeting, but simply for +1 purposes. Again, this type of posting is usually by students or those serving NS.

(3) "I earn $5k/6k/7k per month but still take bus and eat rice + tau you"

This type of posting is usually by a forumer who earns a fair amount, but thinks he earns a lot and wants to show off how financially savvy he is.

(4) "Singapore cars so expensive if I go live in USA/Australia/Europe/Africa/North Pole the cars are so much cheaper, women more beautiful, jobs plentiful and food is tastier"

These are postings by 'politically aware' (i.e. PAP bashing) Singaporeans who seem to think that their job skills will allow them to migrate easily to other countries to work, when they don't realise that their skills can be done by a Chinese/Indian at twice the speed and half the price.

However, today, I will answer this question for you once and for all in 5 easy steps.

Step 1 Take your average monthly salary over the last 6 months and minus your average monthly expenses over the last 6 months.

Note: If you don't know how much you earned or saved over the last 6 months, car ownership is likely to leave you in financial ruin.

Step 2 Add car allowance (if any).

Step 3 Minus public transport costs.

Step 4 Do you have enough money left to maintain the car you are thinking of (car loan, insurance, road tax, petrol, parking, ERP, maintenance, upgrade budget)?

Note: If you never owned a car before and you do your calculations and you think 'oh my god, this cannot be right as it is so expensive'. Congratulations, add 10% to your figure and you now have the cost of car ownership in Singapore.

Step 5

If YES, you can afford a car FOR THE TIME BEING (assuming you are happy to reduce your savings by the same amount).

Note: If circumstances change (change job, lose job, lose car allowance, get married, got baby, loved one falls ill and needs medical expenses), then depending on whether you can sell the car without having to come out with money, you may be financially screwed.

If NO, you cannot afford a car. Sorry. Work harder or spend less, then maybe in the future can.

Extra Observations

1. For young people with less life experience, please note that owning a car and being able to afford a car are two different things. There are many people who cannot afford a car, but still own a car.

Most of the confusion young people face is wondering why their colleague/friend who earns $1500 can afford a car - the answer is they cannot afford a car. Either they have background support from family, or they are financially bleeding to maintain the car.

2. For guys who think that girls like guys with cars - you are unfortunately right. However, most girls do not know or care what sort of car it is, as long as it can get from point A to point B in relative comfort. If you are planning on buying a car for the main purpose of increasing your attractiveness to the opposite sex, a cheap and comfortable one will do - no need for a 'sports car' like a Civic Type R or STi. A guy who has an Altis or Sunny but can afford the occasional nice restaurant treat vs a guy with a STi but can only afford hawker centre or Mcdonalds - who do you think will be more successful in the game of love?

3. BONUS Observation Some people will read this posting and think that I am discouraging car ownership. I am not. I am trying to make sure that ideally, if you choose to own a car, you go in with your eyes open, and not get 'surprised' by your financial situation as time passes and reality sets in. MANY MANY Singaporeans (including car owners who post on this forum) do not 'pass' the test I have put in this posting, myself included when I first started work. Although I was making $5.5k when I bought my first car, due to poor financial discipline, I had almost nothing left every month. It is very unpleasant for a young person to realise that his financial situation is his own responsbility, but the earlier you realise this, the better it is for you. The stress you get from checking your rolled over credit card debt, overdraft and bills every month is even more unpleasant than trying to gain a basic understanding of personal finance. It is unfortunate that for most young men in Singapore, a personal finance lesson is paid for in the shape of a $60k depreciating lump of mental on wheels.

If you still decide to buy a car even though you can't afford it, all the best.
here is a good advise which was posted a year ago.

for your reference.
 

soulmad

Senior Member
Joined
Apr 25, 2005
Messages
615
Reaction score
0
Looking for advice from ppl who’ve seen and experienced more.

Will a take Home of 5.5k (excl. 2-400 take home OT) between my gf and I be enough for the upkeep of a car? Looking at the cerato or Elantra. Considered grab before, but getting one from where we work is a little difficult (Deep inside Tuas).

Assuming,
Dp = 50k
Loan = 30k
Petrol = 200
Road tax = 60
Parking = 120
Insurance = 100
Maintenance = 50

Some background, we save 3.2k a month, and are planning to get a house in 2-3 years time, with the first kid in about 5 years. A car will allow us to sleep in an hour more in the mornings and get home 30mins earlier. Daily commute is about 80km two-way. We work 15mins apart, so pickups and drop offs are no issue. Road condition not so good around these parts, so I expect the maintenance costs after the first 3 years to go up.

What do you guys think?


Petrol = 200 >>>impossible for your mileage. Likely double

Parking = 120 >>> almost impossible unless free work AND home parking

Insurance = 100 >>> impossible for new driver and new car. Easily double
 

frankychin

Junior Member
Joined
Sep 14, 2018
Messages
3
Reaction score
0
Watch TDSR also. Might affect your housing loan.

Petrol = 200 >>>impossible for your mileage. Likely double

Parking = 120 >>> almost impossible unless free work AND home parking

Insurance = 100 >>> impossible for new driver and new car. Easily double
 

chiusk

Member
Joined
Feb 2, 2008
Messages
206
Reaction score
1
Why insurance so high?
Mine only like $50/mth
Petrol $120/mth (go jb n fill)

trying to possibly budget for a Mz6. would like to check if i'm on the right track

Loan installments (loan max 60%): $1k/mth
insurance: $100/mth
road tax: $100/mth
season parking (office + HDB): $200/mth
petrol: $200/mth
misc (erp, parking, servicing): $100/mth
 

Fattyboiboi

Master Member
Joined
Aug 1, 2008
Messages
3,908
Reaction score
219
Basically I always ask myself and ask my friends who want to buy car, can u afford to spend $2k comfortably on your car?

If no, then no need think buy car. Because when I have car, I will want to be at my convenience, so petrol parking erp etc u cannot save.

I see some ppl buy car, but must hiam parking ex, petrol ex, now got erp cannot go this road and I'm thinking drive till so mafan, might as well don't buy car.
 

HondaJG

Senior Member
Joined
Sep 17, 2018
Messages
1,542
Reaction score
1
Basically I always ask myself and ask my friends who want to buy car, can u afford to spend $2k comfortably on your car?

If no, then no need think buy car. Because when I have car, I will want to be at my convenience, so petrol parking erp etc u cannot save.

I see some ppl buy car, but must hiam parking ex, petrol ex, now got erp cannot go this road and I'm thinking drive till so mafan, might as well don't buy car.
$2k/mth on a car? is that full loan?
 
Important Forum Advisory Note
This forum is moderated by volunteer moderators who will react only to members' feedback on posts. Moderators are not employees or representatives of HWZ. Forum members and moderators are responsible for their own posts.

Please refer to our Community Guidelines and Standards, Terms of Service and Member T&Cs for more information.
Top