Thursday, April 10, 2008

Should I buy a car?

Recent circumstances have pushed me to consider purchasing a car. Ok, again. I am one of the last few people who would buy a car. I have a license but I don’t drive. Apart from being a depreciating expense, you can actually purchase an apartment with what a car costs here in Singapore. Depreciating expense versus appreciating expense, you get the drift. That aside, there’s still road tax, insurance, maintenance, AA, ERP, petrol and parking to deal with. My friends like to tell me it’s a lifestyle choice and I have to agree that owning a car has its advantages. You can even purchase a car entirely on a bank loan, no down payment or deposit required. So gainfully employed people like me who are cashless can still purchase our dream car as long as it’s more than $55,000.

Many people view your car as an extension of you. I believe this to be true, as I have yet to find a car that I can say yes to. I am still on the hunt for the perfect vehicle. Picking the right car is tricky. I love the color pink but do not want a car that screams “Woman Driver”. Ideally, it would be easy to drive, a body that looks cute, have a gangster paint job and priced within my budget. But, we can’t always get what we want.

Today’s car loan interest rates average 6.7% p.a.. That's lower than the prevailing credit card rate but still higher than a home loan.

Push Factors for me to buy a car:

1) My office is being relocated to an obscure part of the country

2) My company is offering $200 monthly transport allowance for car owners

3) 100% bank financing

4) I need to be independent

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