The Right Time to Buy a Brand New Car

**slapz** · August 30th, 2012 02:09 PM

So, have you bought your brand new cars? What made you?

**yebo** · August 30th, 2012 02:33 PM

true lahat sinabi nila, kung purely from the point of view of finance buying a brand new car is not wise since it depreciates the minute it rolls out of the dealership. add to that the cost of maintenance and insurance.

but for me i always buy brand new for something i can never substitute with money. peace of mind. i am away from my family half of the time. my wife drives when i am not there, my kids are in the car. i sleep soundly. can't have that with a 2nd hand.

the right time depends on your finances. personally if my total monthly amortization (house, car, insurance, etc) is less than 30% of my income, or i can still meet my savings goals (which for me is at least 20% of my income) then i would. pero if i can not meet either of the 2 then waiting and saving mode na lang muna ako.

**slapz** · August 30th, 2012 02:44 PM

Originally Posted by yebo

true lahat sinabi nila, kung purely from the point of view of finance buying a brand new car is not wise since it depreciates the minute it rolls out of the dealership. add to that the cost of maintenance and insurance.

but for me i always buy brand new for something i can never substitute with money. peace of mind. i am away from my family half of the time. my wife drives when i am not there, my kids are in the car. i sleep soundly. can't have that with a 2nd hand.

the right time depends on your finances. personally if my total monthly amortization (house, car, insurance, etc) is less than 30% of my income, or i can still meet my savings goals (which for me is at least 20% of my income) then i would. pero if i can not meet either of the 2 then waiting and saving mode na lang muna ako.

So you are saying, 30% of Income should be Housing and Car Amortizations? Then 20% is Savings, So 50% is Living Expenses.

So for example, a dude who has a salary of 100K a month, that is about 68K net. So 20.4K should go to housing and car, if you are paying 10K for the house, you got 10.4K to buy a car, which is something like an Accent/Vios or something. Really, if you have 100K Salary, you can just afford a subcompact sedan?

I think ideally that is what it is. But how much can you stretch it?

**uls** · August 30th, 2012 02:55 PM

you stretch naman. buy a more expensive model

you just have to give up some things to make monthly car payments

like zero savings. not eating out. no vacations

hehe

**slapz** · August 30th, 2012 02:59 PM

Originally Posted by uls

you stretch naman. buy a more expensive model

you just have to give up some things to make monthly car payments

like zero savings. not eating out. no vacations

hehe

This I like. I just thought about something, that when you buy a car, you should be sure that it will improve your life, not the other way around. So, buying a car, then lose those three things you said, is not really a good thing...

**uls** · August 30th, 2012 03:01 PM

which defeats the purpose of buying a car hehe

kaya nga you bought a car so you can go out... eat out, go shopping, go out of town...

**slapz** · August 30th, 2012 03:05 PM

I also had this thing before: if I will just earn this amount additionally, I could definitely buy a brand new car. Then you earn that amount, and still you can't afford it. What is up with that?!

**uls** · August 30th, 2012 03:21 PM

coz you're not supposed to spend a large part of your income on monthly car payments leaving what's left of your income for everything else

it's just wrong

**dg1110** · August 30th, 2012 03:22 PM

I think buying a Brand New car can be driven by the following:

- Can you afford it (Cash or Monthly Amortization). For me, the cost of a Brand New car should only be around 10% of your net worth. As they have previously said, its not really a good asset to invest with. May nabasa ako before na 2nd biggest investment ng tao ay ang kotse usually. 1st is ang bahay.

- Will the Brand New car make you or your family happy. Its your hard earn money so spending it is all up to you! If it will make you happy in life then go for it!

Just make sure na pag binili mo yung car mo ay hindi ka naman mag hihirap. Kailangan mo rin isipin ang furture :D. "If it makes you happy, it can't be that bad" - Sheryl Crow

Happiness in life is not about all money.

Tsaka kung wala ng bibili ng brand new, e d wala na tayong mabibiling second hand. Hehehe.

**yebo** · August 30th, 2012 08:32 PM

Originally Posted by slapz

So you are saying, 30% of Income should be Housing and Car Amortizations? Then 20% is Savings, So 50% is Living Expenses.

So for example, a dude who has a salary of 100K a month, that is about 68K net. So 20.4K should go to housing and car, if you are paying 10K for the house, you got 10.4K to buy a car, which is something like an Accent/Vios or something. Really, if you have 100K Salary, you can just afford a subcompact sedan?

I think ideally that is what it is. But how much can you stretch it?

ideally nga dapat ganyan, minimum 20% savings and no more than 30% sa loans.

but actually sir sa akin its 40% na ang ratio ng amortization ko sa income, 25% savings, the remainder is expenses. i was forced by circumstance, na-ondoy yung 1st house namin and i had to buy new cars also due to ondoy. bago din lahat halos ang appliances and furnitures due to ondoy. i am paying for 2 houses, 2 lots and 2 vehicles. pero ok lang malapit na makahinga ulit ng maluwag. 1 house (the ondoy victim), the 2 lots and 1 vehicle will be fully paid next year. so at the end of next year i expect my savings to balloon to 50%.

btw, baka sabihin mo kasi maluho masyado. dapat sana 1 car lang ang naka-loan but i had to buy another last month when my ondoy victim santa fe almost caused my wife to have an accident. di bale na mabawasan ang monthly savings basta safe ang wife and kids ko.