Went through all the other threads related to this topic and this one too. While lot of stress has been laid on making sure buyers do not overstretch, I think it's also equally important not to understretch - if there's such a word in the english dictionary. A classic example of the guy who understretched is yours truly. Read on if you want to find out I did it. Apologies if my writing isn't very atriculate or to everybodys' liking.
Come mid 2007 and my company decided to bestow me with a grade change and a pay package revision which put me bang into a B+ to C car affordability - going by the standards described earlier in the this thread. Though I was in no mood to buy a car (I was deriving immense pleasure just making prepayments to my housing loan and watching the numbers in my bank balance), the pressure from family and other quarters kept increasing constantly until I could no longer ignore it. Out of sheer exasperation and purely to satisfy everybody else, mid 2009, I just went out and bought an Alto LXI - no doubt, cheaper alternatives were available, I did not want to dip below the Alto and I was not interested in used cars. As lady luck continued to smile at me, we were gifted with a child, so now we're a family of five. Even though I was very pleased with my Alto, the negatives of that choice started coming forth quickly and very very awkwardly. The first one to hit me was the sheer lack of space. As long was we were four, it was just okay, but with a baby seat placed in the middle of the rear bench, accommodating two more at the rear started getting troublesome and rear occupants would start complaining within few kms of drive. Added to it was the bulky baby bag that had to be lugged around no matter where we went. That meant the boot was no longer sufficient to carry even our weekend trip baggage. Very soon, parents started complaining about traveling with us, and wife started riding the back seat with the child (Both could not be accommodated on the front seat). The next - though not major was the inability to do decent speeds and with AC on, it was quite difficult to slot into overdrive with full load. We had suddenly and clearly outgrown the car.
This was when I (for the first time) started to think about my affordability and whether I could have done better than the Alto in 2009. As it turns out, there were a lot of options available at that time and had I done a bit more homework, we would have been happy owners of an i20 or swift dzire or whatever, and it would have accommodated our increased space requirements without much difficulty. Sure I can upgrade even now, but the current value I'm getting for my car is terrible and it seems like a huge loss to trade her in for a new car at that price, given the fact that she has lot of life left - not even touched 30,000 on the odo and given the fact that the new car will also depreciate at a scary rate. If I do sell the car, I'll simply be cutting a excellent deal for the buyer.
Make no mistake, I still think the Alto is one of the best VFM
cars you can buy. I am still very attached to her for her simple, down-to-earth, totally reliable, frugal (from every sense) nature and I can blindly recommend this car to any first time buyer. The only negative IMO
is that the car has nothing in the safety features list except seatbelts. But then, at that price point I won't expect them either.
Had I done my homework earlier, the upgrade expense could easily have been put off by several more years. Bottom line - even buying a small/less expensive car might actually work against you. So it's not only necessary to take your present situation into account, it's also important to foresee (to your best) what your requirements are likely to be say in the next 5 - 7 years or for whatever time frame you plan to keep the car.
I have finally decided to keep my dearest Alto forever (Thankfully wifey agreed to use it). I should be going in for a second car pretty soon. What car will that be? Hmm, lets start at the beginning...