Car is a liability in Singapore and the expenses is not just the
car loan but maintainence and running cost as well. A very general
rule of thumb is that a 1.3-1.6CC car would cost monthly S$1.5K and
a 2.0CC car would be minimum $2K. Doesn't really matter how much
you earn but how much disposable income is left for cars.
Ideally, if you can pay the car price full in cash, that's the best
as you minimise your interest payments. However, most people don't
have the type of money and so, the best bet is to minimize the cost
of owning a car is to;
- pay at least 30% downpayment
- buy a 2nd hand car that is at least 2 years or more old
- make sure your declared car price less pro-rated COE is less than
$55K
- go for 5 year loan instead of 7
- get a reliable car that has cheap maintenance cost (like corolla
or lancer)
- get a car with low petrol consumption
You best bet is a corolla G9 - not the nicest looking one but
certainly the most practical!
