What Car Should Be Bought at What Income?


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I guess max one should spend on a car is about 5-6 times his salary. just my personal opinion. a car is not an investment, i fact it depreciates like anything. It can be considered an asset.
Buying a car is not just the OTR. Add to that the fuel bills, yearly premium, depreciation. and am not even considering accidental repairs.
Lets consider this example- One buys a swift vdi at say 6 lacs with 2 lacs down payment and 4 lacs loan. consider rate of 12% pa. So now he/she is paying 48K yearly just in interests. Thats 4K per month. At the end of 5 years the total car would be for 8.5 lacs. But whats the market value of the car- probably 3-3.5 lacs max. Sol lost roughly atleast 4lacs in 5 years, Thats 80 thou per yr.
So if one has a an income of 30k, he should be looking at a car around 2lacs max.(Used alto,zen etc).
Please correct me if am wrong, am very poor in maths! So didnt take up engineering!!
Good thread btw.
Vipul -- Nice thread. In India I have seen that people buy bigger cars even they do not fit into the budget.

The math done by mumbaikar is valid and is quite often neglected while buying a new car. Hence the budget goes for a toss.

A friend of mine from my office bought Fabia 1.2 petrol and guess what he doesn't know how to drive. His salary doesn't even come closer if we take into consideration Vipul's logic. But for him "Class matters"
 
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Nice thread TSIVipul.

As rightly pointed out in all the posts, one need to be level headed while buying a car and consider the ability to sustain.

Just because EMI option is available, should not go for a car beyond our limits.

(Mean time, now I see a posting/thread where TSIVipul has not slapped anybody - no offence just kidding. Cheers!!!)
 
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Best example could be a bachelor earning 40K with no liabilities can even go for a City (Enthusiast type), but a married guy with 2 kids and a house loan might need to content with Wagon R, even for a 80K earning.
Regards,
Neeraj
Excellent Neeraj. Welcome aboard and please share more about you here (Introductions).

Have a pleasant stay at TAI.
 
Thread Starter #21

TSIVipul

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(Mean time, now I see a posting/thread where TSIVipul has not slapped anybody - no offence just kidding. Cheers!!!)
No ..it seems you missed!!

he almost did at Harry porter part of this thread .. LOL.
Damn..My hand is still ITCHY,but no one is ready to show me his cheek..[lol],ELSE MAUKE PE CHAUKA MAARNA HI MARDAANGI HAI(The one who hits shot at time is the man)..[evil]

Rest,the TRUECITYLOVER:
I'd advise you to get all your loans etc over before you get married and then the City will be delight.

Again same point:-
I HAVE MADE THE LIST SUCH A WAY THAT OWNER MUST NOT FEEL THE HEAT OF THE MONEY SPENT ON THE CAR IN HIS BUDGET.
 
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Well, Perspective! only word that comes to mind! What is a car meant to you is the primary criteria here (well most of enthusiast think like that, don't we)
for some, car is a medium to take you from point A to B, who cannot differentiate between Alto and Wagon R (not went to extreme) except the price [sleep]. On other hand there are people who buy cars on installments, but get them seized by defaulting EMIs.
I believe "which car to buy" depends upon how much you can invest. Even for a person in HIG having high liabilities should not invest too much in car. No car can make you enjoy forever and the day it start pinching your pocket, implies love is over.
Best option is to decide on a budget, calculate upkeep cost, EMIs and buy the car. Get 0 depreciation insurance if going for high end cars, Skodas can kill anybody [lol]
Best example could be a bachelor earning 40K with no liabilities can even go for a City (Enthusiast type), but a married guy with 2 kids and a house loan might need to content with Wagon R, even for a 80K earning.
Regards,
Neeraj
very well said.... thoung I am in the 70 + group but haveing a big house loan emi and family maintenance cost in bangalore stopping me from buying Pinto E (7.3 L)
 
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I fall in the 20-30k bracket, have a RTR and a M800. 35k was spent on the M800 to get it ready and maintainence free for time to come, and i had raked up 4k in just a month with night drives and weekend outings. My savings till now is miniscule, and on top of that i met with a accident which left me with a bill of 10k. Still, i can easily recover from the shock, and monetarily i'm doing just fine. Will save next mnth onwards. So a car of this price bracket and this salary bracket helps a lot. My female frnd working in almost same enviro has saved almost 70k in the same time span. A month more of working, but i need a car and bike, so no regrets, and then even she wants to have rides with me, and i love going on outings with her. How could i have managed without my car? So im not complaining. Im loving it!
 
Thread Starter #24

TSIVipul

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I fall in the 20-30k bracket, have a RTR and a M800. 35k was spent on the M800 to get it ready and maintenance free for time to come, and I had raked up 4k in just a month with night drives and weekend outings. My savings till now is miniscule, and on top of that I met with a accident which left me with a bill of 10k. Still, I can easily recover from the shock, and monetarily I am doing just fine. Will save next month on wards. So a car of this price bracket and this salary bracket helps a lot. My female friend working in almost same environment has saved almost 70k in the same time span. A month more of working, but I need a car and bike, so no regrets, and then even she wants to have rides with me, and I love going on outings with her. How could I have managed without my car? So I am not complaining. I am loving it!
That was nice to read your experience,in fact after I read your experience,now I can say quite confidently that if a person follows the chart given by me then he/she will be happy with his/her car.Right?
Rest I am sure you are very happy with your car and its maintenance etc really doesn't disturb you that much.Now consider the condition ifyou would have owned a Swift LDi or a Wagon-R,then these accidents etc would have been painful for you.
 
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Exactly. And actually my mom had almost persuaded me to take her wagonR and leave the 800 for her. In that case, i would be looking at a bill of around 18k. Recoverable, but would have been painful, and wud have exhausted me monetarily. The chart by you is great, and though a bit up down is possible, person adhering to it will be happy in the long run.
 
Thread Starter #26

TSIVipul

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Exactly. And actually my mom had almost persuaded me to take her wagonR and leave the 800 for her. In that case, i would be looking at a bill of around 18k. Recoverable, but would have been painful, and wud have exhausted me monetarily. The chart by you is great, and though a bit up down is possible, person adhering to it will be happy in the long run.
Actually those are my personal experiences.
From the childhood I have been taught that spend only that much money that all your works are carried out comfortably keeping your pocket and future in consideration,there is no use of showing anything to anyone...and I too believe the same CASH IN POCKET LOOKS MUCH BETTER THAN ON ROAD".
Same is here,if anyone follows this given format and then buy a car then what I believe that is the person in a M800 will be happier than the one who owns a Corolla after jumping the budget.

The joy of owning a car is only when its maintenance never disturbs you..[thumbsup]
 
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Do not buy things you don't need, else you will need to sell thing which you NEED!
Overall a very nice thread, kind of introspective one I would say Kudos!

I have seen people buying cars/bikes beyond their budget and the same being towed away on default of EMIs. Automobiles for some is a passion, kind of adrenalin rush, something which makes them happy.

Well do not drink, do not smoke but people do! So do they Drive and will drive at any cost. They cannot be bound under limitations, engine noise is sweet music and silencer smoke is perfume. They will vrooom and vroom and vroom. [clap] Boy O Boy, I am a poet

Well things apart, most of us are sensible enough to understand our limits and have passed those passionate years. But there is still a desire to fly at high speeds, own your dream car that's why we ae here. AT TAI because we are AUTO ENTHUSIASTS, we care what we drive.. [clap]
 
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Actually those are my personal experiences.
From the childhood I have been taught that spend only that much money that all your works are carried out comfortably keeping your pocket and future in consideration,there is no use of showing anything to anyone...and I too believe the same CASH IN POCKET LOOKS MUCH BETTER THAN ON ROAD".
Same is here,if anyone follows this given format and then buy a car then what I believe that is the person in a M800 will be happier than the one who owns a Corolla after jumping the budget.

The joy of owning a car is only when its maintenance never disturbs you..[thumbsup]
Well said Vipul. IMHO I also believe in same. Though my friends were bashing me when I cancelled my octavia l&K and bought alto that time. But I was smiling as I never spent a penny on her except for new battery, regular maintenance and Petrol.
 
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Well, Perspective! only word that comes to mind! What is a car meant to you is the primary criteria here (well most of enthusiast think like that, don't we)
for some, car is a medium to take you from point A to B, who cannot differentiate between Alto and Wagon R (not went to extreme) except the price [sleep]. On other hand there are people who buy cars on installments, but get them seized by defaulting EMIs.
I believe "which car to buy" depends upon how much you can invest. Even for a person in HIG having high liabilities should not invest too much in car. No car can make you enjoy forever and the day it start pinching your pocket, implies love is over.
Best option is to decide on a budget, calculate upkeep cost, EMIs and buy the car. Get 0 depreciation insurance if going for high end cars, Skodas can kill anybody [lol]
Best example could be a bachelor earning 40K with no liabilities can even go for a City (Enthusiast type), but a married guy with 2 kids and a house loan might need to content with Wagon R, even for a 80K earning.
Regards,
Neeraj
Best response to the thread! Somethings in this life are done not considering the logical value. I belong to the school of thought which believes that if you can you should, otherwise you will repent it later. If in case a car is just a means of transport to you then put all your math into it and buy what is most affordable. But in case you dream about driving, then why not push a little. Isn't this life meant to push a little and achieve what we yearn for. If you want to be a Gautam Buddha (not to anyone in particular), no one is stopping you, but then why to be on this forum!

Imagine saving a fortune for you children and dying with only desires in your heart, do you think you lived a worthy life!
 
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I believe you are correct as it depends on a person's mindset and his responsibilities & priorities which help him decide on the budget he wants to spend on his car.
I have seen people earning 2.5 crores per annum but still driving a zen or accent. (my relatives)
I myself earn around 50k pm but being a bachelor and a car enthusiast I went for HONDA CIVIC and I love it. No problems at all.

I have the costliest car in my family at such a young age.[lol]

So It all depends on the risk factor that the person is able to take and his financial condition.

Anshul [cheers]
 
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