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billion$kid 20th June 2012 10:49 PM

Re: Buying Your Car On Finance – The Complete Guide.
 
Quote:

Originally Posted by Mahendra (Post 174374)
In the topic you have mentioned some very valid points like how young boys and girls never make plans and then go over there budget and buy a big car.I too know many young IT professionals who earn very less than we people but have very big cars with them.And when I ask them why they spent all your money on the car then they very smartly tell me that they believe living in present one boy even one time told me that from his degree he can earn very high and hence he lives his own way,not having any degree or diploma makes me silent in front of them.

Dear Mr.Mahindra, you shouldn't feel sad. This is the 21st century. Achievement matters here. Talent/skill is what fetches you $$$ and status. Not certificates. No certificate is bigger than performance in real world. Bill Gates, Mark Zuckerberg, Steve Jobs, Lawrence Ellison... none of them degree holders though it's not wise to compare them with the ordinary business people. But what I'm trying to say is that the mentality of Indians has to change if we are to move forward. Entrepreneurs play a huge role in a country's development.

Having said that, I disagree with what many guys said here. We have no right to interfere in someone's personal life.

Decision making (financial) is a simple process for the office goer. He doesn't have too much to think about when it comes to spending money. But it's not like that for an entrepreneur. He has to consider many factors before taking such a decision, so he goes to the CA. Also keep in mind that a very successful entrepreneur need not run to the CA/fiance dept. every time he wants to spend some money because those expenses would be negligible when compared to his net worth.

The businessman always gives first priority to his business. If it's gone he will struggle(If he is talented he can easily come back). He cant keep changing businesses like changing jobs.

I don't support the anti-loan theory also. If used wisely they are actually beneficial. Consider a guy having Rs.5lakhs monthly income. He wants to buy a BMW 3 series. My advice would be to buy the car under finance scheme. He will have a fair amount of money left with him after paying the EMI which he can invest and/or spend for other personal purposes. That's cool in my opinion. In practical life, loans are very useful if you know how to handle it. Because time is limited.

But I agree with one thing that Mukesh said. One should attain a minimum level of financial stability before he starts thinking about spending it for luxuries.

dr_sachin 21st June 2012 08:34 AM

Re: Buying Your Car On Finance – The Complete Guide.
 
Quote:

Originally Posted by billion$kid (Post 174615)

I don't support the anti-loan theory also. If used wisely they are actually beneficial. Consider a guy having Rs.5lakhs monthly income. He wants to buy a BMW 3 series. My advice would be to buy the car under finance scheme. He will have a fair amount of money left with him after paying the EMI which he can invest and/or spend for other personal purposes. That's cool in my opinion. In practical life, loans are very useful if you know how to handle it. Because time is limited.

But I agree with one thing that Mukesh said. One should attain a minimum level of financial stability before he starts thinking about spending it for luxuries.

well said billion$kid,i too agree that loans should be planned and used wisely and only then they are really helpful.my take home salary is nearly 65k,and i wanted a car,if i first save and collect 10 lakhs then plan for a car then it is of no use,as i need and can enjoy the car now,after 8-10 years what should i do with it,when i will be having other responsibilities too.so i planned for car loan,calculated an optimum emi for me and got the car.as i said earlier we must keep atleast 10% of the car cost handy at all times,this thing is important as when i met with accident this 1 lakh helped me to get a new one in very short period.this car is also on loan and next month i will again make 1 lakh handy,to be tension free.(in the whole process i din't have to borrow a single penny from any other as i planned the loans,and living happily right now).

@mahendra,your silence is the biggest answer to idiots like those who talk like this.no degree can give you money if you don't have skills.many degree holders(parents get them to big institutes)are still standing just because of parental support only.probably the people who talk like this are fed by their parents from hand to mouth,because the people who actually earn the degree knows its value,and know the truth.thumbs up to you if you are earning more than these virtual degree holders.

TSIVipul 21st June 2012 08:42 AM

Re: Buying Your Car On Finance – The Complete Guide.
 
Well guys I never said that loan is bad,what I was saying that,take the loan but be strict to your own limits.What is the use of paying 20k in various EMIs when your salary is 30k itself.

On the loan part,even I was also going to buy the Superb on loan because instead of spending those 26 lacs in car,it was more beneficial to pay 8 lacs and spend other 18 lacs by adding more 22 lacs or 32 lacs to them and invest them in some hot properties.And at the end we did the same,no Superb but some high returning flats.
But if you are earning quite good then I think buying any car upto 15 lacs is more beneficial on cash.

vaibhav 21st June 2012 08:55 AM

Re: Buying Your Car On Finance – The Complete Guide.
 
@TSIVIPUL you are right man. Now economy is in the doldrums and recession is likely to worsen for next 2-3 years. Car companies are already hit by less sales.
Now negative sentiment will result in bad loans also. Indians have to shrug this western culture of consumerism on loans
This feeling of getting rich without being rich resulted in such good sales of cars. Now everything will be back to normal
One good thing maruti and its dealers will soon may give dezire on the spot [lol]

ERTIGA_ZMR 21st June 2012 09:18 AM

Re: Buying Your Car On Finance – The Complete Guide.
 
Even I don't support anti loan theory,but the loan amount should not be too high that it seems to be a big burden.For House Loan, take loan in such a way that you should be able to pre close in 5-6 years. For Car loan, I believe it should not be more than 1/2 of your Annual income. If you earn 12 lakhs per annum, take loan worth 6 lakhs and try to close by 1 year. Once if you are loan free, then only you can think to invest further. But what I believe, there should be a cash resrve of 6 times of your monthly salary. This can help in bad/lean phase.
My point of view is that we should not pay a very hefty amount like 20K for House rent, rather pay EMI of 40K for homeloan.For any moderate salaried person, one should not buy a very expensive car which is hard to maintain rather go for VFM.
Regarding expensive stuffs like Mobile Phone, IPad, Mac book , SLR camera these stuffs people will buy when they start earning. Just imagine a 22 year old Software Engineer earns a average salary of 30K,if that person has no liability towards parents or any study loan then he/she has full right to enjoy his life lavishly atleast till he/she cross the age of 25-26 ( as till 22 years those poor kids are always under burden of study and ambitions so to do well, fullfill the parents dream). Believe me, this is true with most of us who started earning well at early age. My funda is that we should not regret at the old age that as ohh I didn't enjoy my youth period. With the age and along with guidance from parents those kids get matured and become very good in financial planning and investments. Just to ensure a very secure future one should not fully ignore the present. This is wat my parents used to tell me, "that if you compromise a lot then it's waste of our struggle".But at same time my dad made me to book a flat at the age of 24 so that by the time I got marrried my House was nearly loan free.:)

These are my personal view.

TSIVipul 21st June 2012 09:45 AM

Re: Buying Your Car On Finance – The Complete Guide.
 
Quote:

Originally Posted by vaibhav (Post 174690)
@TSIVIPUL you are right man. Now economy is in the doldrums and recession is likely to worsen for next 2-3 years. Car companies are already hit by less sales.

Haha,recession means again good big cars will be fr sale at dirt cheap prices,many companies have already cut their sales for the same reason.

Quote:

Now negative sentiment will result in bad loans also. Indians have to shrug this western culture of consumerism on loans
This feeling of getting rich without being rich resulted in such good sales of cars. Now everything will be back to normal
One good thing maruti and its dealers will soon may give dezire on the spot [lol]
Buddy loans are taken in two cases:-
  • When your 2 years income is more than the loan amount.
  • When your 3 years income is less than the loan amount.
In first case you will always be happy with the loan and save a lot on income tax by the loan,but in case your three year income is less than the loan amount,then definitely the loan is going to disturb you quite soon.

Quote:

Originally Posted by ERTIGA_ZMR (Post 174700)
Even I don't support anti loan theory,but the loan amount should not be too high that it seems to be a big burden.For House Loan, take loan in such a way that you should be able to pre close in 5-6 years. For Car loan, I believe it should not be more than 1/2 of your Annual income. If you earn 12 lakhs per annum, take loan worth 6 lakhs and try to close by 1 year. Once if you are loan free, then only you can think to invest further. But what I believe, there should be a cash resrve of 6 times of your monthly salary. This can help in bad/lean phase.
My point of view is that we should not pay a very hefty amount like 20K for House rent, rather pay EMI of 40K for homeloan.For any moderate salaried person, one should not buy a very expensive car which is hard to maintain rather go for VFM.

That's what I was saying,the loan must be like that that you must be able to pay it back within 4-5 years.Actually the loan is not the only liability a person has,there are many more liabilities and people must plan their financial structure same way so as he/she may be able to easily withstand the load of loan from his/her salary.For example:You cancelled your Ertiga because you felt like you need some more time to strengthen your financial condition even more.This is finally going to keep you happy in long term,a three months delay will keep you happy for 3 years.

Quote:

Regarding expensive stuffs like Mobile Phone, IPad, Mac book , SLR camera these stuffs people will buy when they start earning. Just imagine a 22 year old Software Engineer earns a average salary of 30K,if that person has no liability towards parents or any study loan then he/she has full right to enjoy his life lavishly atleast till he/she cross the age of 25-26 ( as till 22 years those poor kids are always under burden of study and ambitions so to do well, fullfill the parents dream). Believe me, this is true with most of us who started earning well at early age. My funda is that we should not regret at the old age that as ohh I didn't enjoy my youth period. With the age and along with guidance from parents those kids get matured and become very good in financial planning and investments. Just to ensure a very secure future one should not fully ignore the present. This is wat my parents used to tell me, "that if you compromise a lot then it's waste of our struggle".But at same time my dad made me to book a flat at the age of 24 so that by the time I got marrried my House was nearly loan free.:)

These are my personal view.
Your personal views are just spot on with an added advantage of real experiences.Actually you have made a small compromise on your show off type happiness by booking the flat and paying for it instead of buying a bog car etc etc.Result is that the car owners are still living on rent because now the property has became very expensive and car has depreciated,but your own property has given you an advantage that you own a house of yourself,now you can easily buy a car and since you have your own house,hence you have already fulfilled your biggest liability.Hats off to you buddy..

ERTIGA_ZMR 21st June 2012 10:16 AM

Re: Buying Your Car On Finance – The Complete Guide.
 
Actually this time I belive Indians are more cautioned about their financial planning during recession. I still remember in 2008-09, there was a suicide case in my ex-organization where a senior manager failing to pay his emi and meeting the monthly expenses. That incident had shaken many of us. During 2009, there are many cars were on sale because people failed to repay. Hope we should not witness such incidents this time, it's very harsh on the family who suffered. One of my relative he is working in HSBC bank at very high post has suggested to keep a buffer of 6 months take home income for any emergency.
The good thing about India is that our parents have planned a lot and created assets which helped the youngesters to tackle lean phase. While in US there is no concept of saving thats why the salaried person felt the heat during recession. I still remember 2008-2009 when I was in US and recession had hit everyone badly. Even India students who had take huge study loan for their MS were unable to get the job and were delivering Pizza( no harm in delivering Pizza rather starving).My cousin had purchased a big house during recession as Mortgage was at very low rate as well as property was cheap.My cousin managed the recession well because of his saving.We used to feel very bad when our client were doing mass layoff that time, many of our American colleagues became jobless in the same day.
This time hope such worse situation should not come.

There was a sad article in ET:

Aviation sector crisis: Hi-flying pilots struggling to pay jumbo EMIs

Big bucks and pilots have been synonymous, but downsizing, paycuts and deferred salaries have seen many in this elite group find it difficult to pay up on existing home loan EMIs

This flight of fancy has hit an air pocket. Many young pilots in the country, who had started their careers on enviably handsome salaries, are now finding it difficult to repay the housing and car loans they had taken, owing to the financial crisis in the aviation sector.

A pilot's starting salary at Air India is anywhere above the Rs 1 lakh figure, and a commander gets as much as Rs 7 lakh per month. Understandably, many of these pilots have bought homes and fancy cars on a bank loan. However, due to non-payment of salaries for as much as six months at a time, a lot of these pilots are now defaulting on their EMIs. Add to that recommendations for a pay cut, and their cup of woes does overflow. Captain Tauseef Mukadam, joint secretary of the now de-recognised Indian Pilots Guild, doesn't have to look far for an example; he had to ask for a three-month waiver from the bank on his housing loan. "There are also cases of people having to sell off their homes because they could not afford the EMIs, which are often as high as a lakh of rupees," he says.

Anand Verma (name changed) is another case in point. The pilot, with a salary of Rs 2.25 lakh per month to boot, bought a plush apartment when he landed a job with Kingfisher Airlines, and was paying an EMI of Rs 62,000 per month on the loan he took. But when pilots' salaries were indefinitely delayed, he ended up exhausting his savings to ensure he could pay his EMIs, before finally switching jobs. "It was very stressful. But not everyone has a corpus of funds to fall back on, and I had colleagues who were defaulting on loan repayments," he says.

source:
http://economictimes.indiatimes.com/....cms?prtpage=1

billion$kid 21st June 2012 02:01 PM

Re: Buying Your Car On Finance – The Complete Guide.
 
Thanks Sachin. You are right. A car or house is not something you buy every month. And waiting for money to pile up is a stupid idea. In life, time is very limited. At the end of the day, one who enjoys it to the fullest by utilising the resources around him/her wisely is the winner.

Let's take a look the options Sachin had:

It would have taken him around one and a half years to save enough money to buy the car. But he will have to save the whole salary for that. Those one and a half would be miserable for him. And after one and a half years(of misery), there he is with a car (ANHC?) and zero savings. If he needs money for some emergency, what would he do? That's stupid.
But luckily, he's not stupid. He's smart. He bought it under finance. He got the car in a few weeks and has plenty of money to play with. He can use it in whatever way he wants to. He can invest it or he can spend it for his personal needs. The EMI of the car is not going to affect him. He is enjoying his life which is the goal for most of us.

@Vipul
If you look at everything with a business mind what you said will stand true. But there's more to life than business. The word practical is different for different people. If you already have the income, why not follow your heart? Trying to earn and save more and more is just a stupid idea if it doesn't bring happiness or satisfaction in life. To some people it does and to many it doesn't.

But it's true that the youngsters of today spend a lot more than they earn to buy useless things. One should buy things based on his/her needs. Most of the guys who buy tablets and expensive smartphones don't need it. But it's the prestige factor that forces them. If it is of absolutely no use for you then why buy it? It is difficult to make them understand all this though. It would be great if companies employ some kind of guidance system for the new kids on the block.

It's always good to create plans for life. If you are well planned, you will always be the Mr.Wonder for the ones around you.

TSIVipul 22nd June 2012 10:13 AM

Re: Buying Your Car On Finance – The Complete Guide.
 
Quote:

Originally Posted by ERTIGA_ZMR (Post 174715)
A pilot's starting salary at Air India is anywhere above the Rs 1 lakh figure, and a commander gets as much as Rs 7 lakh per month. Understandably, many of these pilots have bought homes and fancy cars on a bank loan. However, due to non-payment of salaries for as much as six months at a time, a lot of these pilots are now defaulting on their EMIs. Add to that recommendations for a pay cut, and their cup of woes does overflow. Captain Tauseef Mukadam, joint secretary of the now de-recognised Indian Pilots Guild, doesn't have to look far for an example; he had to ask for a three-month waiver from the bank on his housing loan. "There are also cases of people having to sell off their homes because they could not afford the EMIs, which are often as high as a lakh of rupees," he says.

Anand Verma (name changed) is another case in point. The pilot, with a salary of Rs 2.25 lakh per month to boot, bought a plush apartment when he landed a job with Kingfisher Airlines, and was paying an EMI of Rs 62,000 per month on the loan he took. But when pilots' salaries were indefinitely delayed, he ended up exhausting his savings to ensure he could pay his EMIs, before finally switching jobs. "It was very stressful. But not everyone has a corpus of funds to fall back on, and I had colleagues who were defaulting on loan repayments," he says.

source:
Aviation sector crisis: Hi-flying pilots struggling to pay jumbo EMIs - The Economic Times

Buddy the basic reason behind this is not getting the loans insured,due to which in case of any financial crisis such people have no way to save themselves or say they have no risk cover.
Even my own house is also having a hefty loan on it(in fact we have three home loans altogether with EMIs crossing 1.45 lacs) but since all the loans we take are insured and are taken in such away that they help us save taxes,distribute our investments even more and are easily affordable without jumping any budget.Hence we have no issue with the loans and no doubt they all will be cleared within 3-4 years itself.
Secondly we have established a small office in the home itself and after that 'jai baba CA',even more tax benefits and one small subsidy too was attained.
Just think,we are paying a good rent for the office area in our own house(this is an advantage of having properties on the name of one member of family and office under another),this was another advantage..:biggrin:

Quote:

Originally Posted by billion$kid (Post 174801)
Thanks Sachin. You are right. A car or house is not something you buy every month. And waiting for money to pile up is a stupid idea. In life, time is very limited. At the end of the day, one who enjoys it to the fullest by utilising the resources around him/her wisely is the winner.

No doubt,but my point of concern is using the resources sensibly.One guy named XXXX is in properties selling business in NCR just like me.The guy earned about 1.3 crore in 3 years and bought a used(new) Audi A8 for about 75 lacs,now the A8 is parked in a rented house and worse happened that now a days the business is running in slowdown and with the economic crisis and terror of recession people are now busy saving instead of spending the money they have.
Definitely this guy could easily afford an A8,but still I find this decision a foolishness.BTW,

Quote:

Let's take a look the options Sachin had:

It would have taken him around one and a half years to save enough money to buy the car. But he will have to save the whole salary for that. Those one and a half would be miserable for him. And after one and a half years(of misery), there he is with a car (ANHC?) and zero savings. If he needs money for some emergency, what would he do? That's stupid.
But luckily, he's not stupid. He's smart. He bought it under finance. He got the car in a few weeks and has plenty of money to play with. He can use it in whatever way he wants to. He can invest it or he can spend it for his personal needs. The EMI of the car is not going to affect him. He is enjoying his life which is the goal for most of us.
My friend too lost his City just like Sachin last year,his car was bought against full cash payment,but he had more than enough money in reserve.
Okay,Sachin did took a good decision because he had already kept enough backup in case of any emergency.But my point of concern is not about the financially sound people like Sachin.I am here discussing about what sort of finance planning one needs before moving ahead to buy the car.
Buddy,whatever it may be,but jumping ones budget or income is not at all advisable for buying a car.About home,no doubt everyone(nearly) has to jump his budget for it.
No doubt loan is the better way if you have just enough cash to buy the car because in such a case your loan will help you in many ways and added advantage of a bank balance always comes handy.
BTW,Sachin buddy have you got your car loan and all other loans insured?:smile:

Quote:

@Vipul
If you look at everything with a business mind what you said will stand true. But there's more to life than business. The word practical is different for different people. If you already have the income, why not follow your heart? Trying to earn and save more and more is just a stupid idea if it doesn't bring happiness or satisfaction in life. To some people it does and to many it doesn't.
Buddy there is a lot of difference between saving and planning.
We knew that car loan EMIs are not going to give us any benefit and this will be just a payment of some high interest only.For saving we need to wait for many years and then we get the car but by planning we got two within six months and will get next two within next one year.In my views if you have enough cash and now you don't have any good deals left in market for you under your budget then its always better to maintain a bank balance for any deals which come under the budget and go ahead for the car buys in cash for the remaining money.We did the same and are really happy.Also our CA too recommended us do the same because as per his calculations we could not get any tax benefits in car loan and couldn't invest any more money in properties too in that financial quarter.
In other words,financial planning is always done practically not with heart.

Quote:

But it's true that the youngsters of today spend a lot more than they earn to buy useless things. One should buy things based on his/her needs. Most of the guys who buy tablets and expensive smartphones don't need it. But it's the prestige factor that forces them. If it is of absolutely no use for you then why buy it? It is difficult to make them understand all this though. It would be great if companies employ some kind of guidance system for the new kids on the block.
Actually this is important for maintaining one's social status.Now a days people are having partial identity by the place they live,the car they drive and the phone etc they use.So somewhere they are important too.Only limits are meant to be followed.
HOW MANY OF YOU GUYS HAVE SEEN NEW GUYS AND GIRLS WITH EXPENSIVE PHONES BUT LOW BALANCE IN IT??It is a very usual sighting,the phone costs 30,000 and the balance is not even Rs 30.00 some times!![lol]

Quote:

It's always good to create plans for life. If you are well planned, you will always be the Mr.Wonder for the ones around you.
+100..
Thanks for sharing your views ERTIGA_ZMR,Dr.Sachin and Billion$Kid,your views really added too much to the thread too and made it a lot more readable.
It looks like many queries have been solved now..now let's bring soem more from different firelds.

vaibhav 22nd June 2012 10:49 AM

Re: Buying Your Car On Finance – The Complete Guide.
 
Hmm
I think its a great to buy a 2 yr old petrol sedan at 50% price and install cng in it and enjoy for 10 years......[:)]
No need to take loan for new cars

dr_sachin 22nd June 2012 09:12 PM

Re: Buying Your Car On Finance – The Complete Guide.
 
@tsivipul
gurudev as you said i had both my loans insured.[:D]you really have a knowledge ahead of your age and its a very good thing,really appreciable.
this topic is so much informative and everyone joining this thread is contributing a lot,hope this trend will continue.[clap]

billion$kid 23rd June 2012 03:38 PM

Re: Buying Your Car On Finance – The Complete Guide.
 
Vipul, Real estate business is full of problems. It's not reliable source of income and cant be considered consistent. If the guy's wish is to get an A8, then he should buy it. For whom is he saving? As I said life and business are two entirely different things. Not many people will go for a used A8. He did. That tells you something about his desire for that car.

The kind of financial planning you talk about are not necessary for the majority of the people. I'm talking about office goers. Business people who stand on thin line may need that kind of planning.

Now the serious bit. Posting it in bold because this is very important.

Selling fixed assets for buying temporary assets like car is a stupid idea. Don't do that. It's better to take a loans. Why? The value of money is decreasing. Your income is increasing and the EMIs are not. After 2-3 years the EMI will be lot easier for you to manage. And the value of the fixed assets like properties or house will be several times what it is now. This logic applies to people with a consistent increasing income. And this is why I'm against Vipul's theory which deals with an uncertain future. For a business man(not the big boys...but remember even the big boys like the Lehmans can fall) future is uncertain but not for the majority of the office goers.

Your parents run a business. They are looking to increase the income and assets. They planned well and are earning quite a bit. But that's because they are running a business. When you have a lot of something it's easy to play with it. A regular IT professional who gets a limited fixed income wont be able to manage it in the way your parents do. He wont be ready for it either.

If you tell Sachin to buy a Nano now and then buy the City after several years of planning, is he going to agree?[lol] Probably not! Maybe he will be able to buy an Accord after 5 years. But that's not life buddy. In life you need happiness. And most people are not interested in doubling their assets by compromising on their lifestyle. Your theory suits a vigilant businessman who is always looking for investment opportunities and all.

You have a very valid point about the status that gadgets and cars bring. People are valued based on the car they drive and the gadgets they have. But the real BOSS will always stand out in the crowd not because of his car or gadgets but because of his personality. The way he behaves, the way he talks...

Planning is indeed important. But you needn't think like Warren Buffet every time you spend some money.

“If I knew a miser, who gave up every kind of comfortable living, all the pleasure of doing good to others, all the esteem of his fellow-citizens, and the joys of benevolent friendship, for the sake of accumulating wealth. Poor man, said I, you pay too much for your whistle.”
-Benjamin Franklin

dr_sachin 23rd June 2012 03:51 PM

Re: Buying Your Car On Finance – The Complete Guide.
 
nice points billion$kid[thumbsup]

TSIVipul 26th June 2012 10:17 PM

Re: Buying Your Car On Finance – The Complete Guide.
 
Quote:

Originally Posted by billion$kid (Post 175427)
Vipul, Real estate business is full of problems. It's not reliable source of income and cant be considered consistent. If the guy's wish is to get an A8, then he should buy it. For whom is he saving? As I said life and business are two entirely different things. Not many people will go for a used A8. He did. That tells you something about his desire for that car.

The kind of financial planning you talk about are not necessary for the majority of the people. I'm talking about office goers. Business people who stand on thin line may need that kind of planning.

Hehe,typical job-doer thinking.
Always feeling like business is always inconsistent or say business has a lot of risk.
My dear,which job is risk free?Even in government sector too.

About A8 thing,the guy is the owner.I'll buy mine when I'll feel the urge to buy one.Rest I can assure you that I can buy and drive an A8 too for a lac kms,but then why should I spent my 90 lacs for a car especially when I can earn 9 crores out of that money?
A Maruti Alto which is easy on the pocket and is serving well is always better than an A8 parked in the porch.The desire automatically goes into the sewer is you are not financially sound.

Quote:

Now the serious bit. Posting it in bold because this is very important.

Selling fixed assets for buying temporary assets like car is a stupid idea. Don't do that. It's better to take a loans. Why? The value of money is decreasing. Your income is increasing and the EMIs are not. After 2-3 years the EMI will be lot easier for you to manage. And the value of the fixed assets like properties or house will be several times what it is now. This logic applies to people with a consistent increasing income. And this is why I'm against Vipul's theory which deals with an uncertain future. For a business man(not the big boys...but remember even the big boys like the Lehmans can fall) future is uncertain but not for the majority of the office goers.
Buddy I never said about selling fixed assets for a car.
You are right that the income is increasing but with the same rate the expenses are also.A single guy is different and a person with a family of 4 is different.
Definitely my theory is not applicable to all and I accept it openly.In fact have already mentioned that theory changes with the case.
Future is uncertain for every person,either he is a businessman or a job doer and what keeps one safe in the time of uncertainty is the planning.Now its like that:-
Either plan and live or don't plan and commit suicide during uncertain times.This is what a lot of your job doers did in 2008-09.So how is their future safe?I need the answer to this question.
My dear,ek 2-3 lakh ki insurance policy security nahi formality hoti hai(a 2-3 lac risk cover insurance policy is just a formality,not a security).

Quote:

Your parents run a business. They are looking to increase the income and assets. They planned well and are earning quite a bit. But that's because they are running a business. When you have a lot of something it's easy to play with it. A regular IT professional who gets a limited fixed income wont be able to manage it in the way your parents do. He wont be ready for it either.
You are somewhere spot-on,but I think the issue is getting lost.Point is that when that 'limited fixed income' is also jumped,then what happens?

Quote:

If you tell Sachin to buy a Nano now and then buy the City after several years of planning, is he going to agree?[lol] Probably not! Maybe he will be able to buy an Accord after 5 years. But that's not life buddy. In life you need happiness. And most people are not interested in doubling their assets by compromising on their lifestyle. Your theory suits a vigilant businessman who is always looking for investment opportunities and all.
Buddy,any person who can easily afford a City can go for one even today,why I'd recommend him/her to buy a Nano?It looks like your words are now getting converted into direct attacks.
Please define happiness buddy?
No doubt,the businessman part is again right,but compromising thing is wrong.And again,my theory is not applicable for everyone.

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You have a very valid point about the status that gadgets and cars bring. People are valued based on the car they drive and the gadgets they have. But the real BOSS will always stand out in the crowd not because of his car or gadgets but because of his personality. The way he behaves, the way he talks...
+100..

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Planning is indeed important. But you needn't think like Warren Buffet every time you spend some money.
+100..[lol]

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“If I knew a miser, who gave up every kind of comfortable living, all the pleasure of doing good to others, all the esteem of his fellow-citizens, and the joys of benevolent friendship, for the sake of accumulating wealth. Poor man, said I, you pay too much for your whistle.”
-Benjamin Franklin

Haha,let me recite a small idiom here "Bandar kya jaane adrak ka swad"..

billion$kid 27th June 2012 06:14 PM

Re: Buying Your Car On Finance – The Complete Guide.
 
Quote:

Originally Posted by TSIVipul (Post 176339)
Hehe,typical job-doer thinking.
Always feeling like business is always inconsistent or say business has a lot of risk.
My dear,which job is risk free?Even in government sector too.

I'm also in the business field. And my field of business is safer than some others. Competition is there but it's healthy because the competitors are all gentlemen. Real estate business is full of problems. Everybody knows that. It's good if you want easy money but there's always a chance of losing it any time.

A business man faces uncertainity about the future. But a job isn't like that. No uncertainities there. Nobody is going to make you work without paying salary and if you lose a job you can get another one. It's not easy to keep changing businesses. I'm not here to support anyone but I want this guide to be practical.

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Originally Posted by TSIVipul (Post 176339)
About A8 thing,the guy is the owner.I'll buy mine when I'll feel the urge to buy one.Rest I can assure you that I can buy and drive an A8 too for a lac kms,

The guy feels the urge to buy one now so decided to buy one.

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Originally Posted by TSIVipul (Post 176339)
Now its like that:-
Either plan and live or don't plan and commit suicide during uncertain times.This is what a lot of your job doers did in 2008-09.So how is their future safe?I need the answer to this question.

People who spend money without thinking about their income will definitely regret later. The global economic recession you are talking about affected everyone including the business people. Now since you consider me as the representative of job doers, let me ask you a return question. What happened to the major business houses during that depression? Lehman Brothers Holdings, a financial services provider for more than 150 years is no longer there.
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Originally Posted by TSIVipul (Post 176339)
but then why should I spent my 90 lacs for a car especially when I can earn 9 crores out of that money
Buddy,any person who can easily afford a City can go for one even today,why I'd recommend him/her to buy a Nano?It looks like your words are now getting converted into direct attacks.
Please define happiness buddy?

Definition of happiness : "state of well-being characterized by emotions ranging from contentment to intense joy."
BUT, different things bring happiness to different people. For you, it might be making 9 crores from 90 lakhs and for someone else it might be buying his dream car and enjoying his time with it now.
A 25 year old guy may not be able to enjoy his life in the same way when he reaches 40. So one needs to think practically. You can keep saving money but for whom?

“Since you go where all have gone before, why do you torment your your disgraceful life with such mean ambitions, O miser? [Lat., Abiturus illuc priores abierunt, Quid mente caeca torques spiritum? Tibi dico, avare.]”
-Phaedrus (Thrace of Macedonia)

We both have different sets of ideas and concepts so do other people. Let them read this informative and very relevant thread and decide on it. We have already mentioned more than enough information to all.[thumbsup]


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