hi LaDyGaRnet: for new car i think it is abt like this, the
other marchies can correct me as well.......
Finance: OCBC FINANCE LTD
Model: NEW nissan march k12
Total Price: S$59,000.00
Down Payment: S$9,000.00
Loan Amount: S$50,000.00
Monthly Payment for the respective Year:
1st yr S$ 4,258.00
2 yrs S$ 2,175.00
3rd year S$ 1,481.00
4th year S$ 1,133.00
5 yearsS$ 925.00 (it will be $925 per month for
5years/60mths)
6 yrs S$ 786.00
7 yrs S$ 687.00
8 yrsS$ 617.00
9 yrsS$ 559.00
10 yrs S$ 513.00
* Rates subject to change without prior notification.
Rule of 78 Loan Calculator
http://www.reidtax.com/rule78.html
Do you have:
1) In cash, at least enough liquidity to survive 12 months
(retrenchment proving) including servicing of debt and expenses?
Typically 6 months salary
2) No more than 30-40% of NET monthly income servicing debt?
(including mortgages, loans, credit card bills)
3) A retirement plan, and regular contribution of your balance
income to that plan?
If you satisfy all of the above conditions, how do you work out the
affordability of purchases?
Simply find out how much you can afford to pay each month to bring
your debt servicing to 40%. That's the MAXIMUM installment you can
afford to pay each month.
The maximum downpayment you can afford determines the price of the
car you can buy. Obviously you can load up to 100% financing if you
wish, but calculate the interest impact first and make sure you
understand the trade-off in cost and the amount you lose on resale.
I personally would not load more than 70% financing, but others
think otherwise. Whatever you wish to pay down, remember you need
to rebuild your cash reserves to survive retirement.
Bottom line is, if you're contributing 40-50% of your net monthly
income to savings via retirement plans, insurance, FDs etc, buy
anything you want with the balance.
its not a matter of
how much we make every month....
but rather, how much we can SAVE every month.
