Can I afford a brand new FD Civic? [MERGED]

[cokyi]

Hi guys. I'm looking into buying a brand new car right now. I'm single and have no other bills to pay except for our house's monthly DSL payment.

I've been wondering what percent of my salary should I dedicate into a car's monthly amortization? And how much SHOULD I be making to afford let's say a brand new Honda Civic? In totality a Civic costs twice my annual salary, not taking into account a possible pay increase.

Can I afford one? Thanks guys.

[cokyi]

Hi guys. I'm looking into buying a brand new car right now. I'm single and have no other bills to pay except for our house's monthly DSL payment.

I've been wondering what percent of my salary should I dedicate into a car's monthly amortization? And how much SHOULD I be making to afford let's say a brand new Honda Civic? In totality a Civic costs twice my annual salary, not taking into account a possible pay increase.

Can I afford one or is it practical for me to buy one given my salary? I'm actually choosing between a Civic 1.8v or a Jazz 1.3 A/T. Let me know your thoughts.

[abcerase]

hi sir,

ideally (and based on banks), the monthly amortization should be around 30% (at most 40%) of your monthly amort. in order for you to still have headroom for future and unseen expenses.

I guess your annual salary is around 400k and would give you a monthly salary of around 30-34thou (not being slashed with witholding tax of at least 7thou)...

Given that into perspective, I think the question on affordability depends on the amount of d/p that you're going to pay: a civic 1.8v (a/t) * 20% d/p will have you pay at minimum 16.5thou per month for 5 years while a jazz 1.3 a/t * 20% d/p will have you pay around 14.5thou per month. In an IDEAL scenario, both cases are NOT advisable. if this would be put into consideration, IMHO, you need to shell out at least 35% - 40% d/p so that you can IDEALLY afford one.

This is only me since I am more of a traditional payer Hope it helps.

[_Qwerty_]

ipon ka nang pang downpayment.. then for a civic.. if you can pay 20T monthly for 3 years.. or 16T for 4 years.... then kaya na yan..

[cokyi]

hi sir,

ideally (and based on banks), the monthly amortization should be around 30% (at most 40%) of your monthly amort. in order for you to still have headroom for future and unseen expenses.

I guess your annual salary is around 400k and would give you a monthly salary of around 30-34thou (not being slashed with witholding tax of at least 7thou)...

Given that into perspective, I think the question on affordability depends on the amount of d/p that you're going to pay: a civic 1.8v (a/t) * 20% d/p will have you pay at minimum 16.5thou per month for 5 years while a jazz 1.3 a/t * 20% d/p will have you pay around 14.5thou per month. In an IDEAL scenario, both cases are NOT advisable. if this would be put into consideration, IMHO, you need to shell out at least 35% - 40% d/p so that you can IDEALLY afford one.

This is only me since I am more of a traditional payer Hope it helps.

Wow thanks a lot for the very insightful reply. Yes, I plan to shell out 35-40% for DP. I'm just kinda worried shelling out half of my monthly salary (at most) for a car. I plan to keep it for 5 years, at the very least.

Safe to say that yes, I can very well pay for a civic's monthly amort. Question is, is it advisable? How about you guys? How much was your monthly income when you first bought your brand new car?

[Horsepower]

If you don't mind driving these, you can buy a 2nd hand car now like a Nissan B14 or Civic '00s. It's a very good car. Very low resale value too so you can get it a bargain. Just beware of drowned units.

After getting that, you can start saving your amortization money for a brand new car.

That route saves you the headaches, stress and having to pay huge interests (as much as +300K). That 300K can be useful for something else.

[cokyi]

Hmm.. technically, I CAN afford one. Maybe the question is it is advisable to pay half of my monthly salary on car amortization? How about you guys? How much were you making when you first bought a brand new car?

[_Qwerty_]

the best way to go is save save save.. then buy your first car CASH.. di wala kang utang.. remember.. hindi lang yung acquisition cost ang babayaran mo.. may maintenance.. then gas, parking, etc... so include that in the computation as well.

[jjmd3_787]

Yes you can. Basing on the info you gave, I assume you're earning more or less 40k/month. Right?

Being single etc..., all you have to do is save for the D/P and pay the rest within 3 years. Or if you're in a company and it offers car loan plans, mas maigi ng idaan mo dito kasi mas mura ang lalabas na interest as compared to the Bank.

Goodluck!

[pcuerpo]

even if you're planning to keep the car for 5 years, are you willing to have a monthly obligation for those months/years to come? if you dont mind, then go ahead. but having a monthly 10k obligation is a bit big if you think about it. consider pa gas, i normally spend around 4k to 5k a month for gas alone (i drive a '09 Jazz 1.5 and at least 1 full tank a week).

if you can afford it, try at least the maximum would be for 2-3 years to pay but it would mean higher monthly costs.

[DonCamote]

Hmm.. technically, I CAN afford one. Maybe the question is it is advisable to pay half of my monthly salary on car amortization? How about you guys? How much were you making when you first bought a brand new car?

Quick math says you can based on data you provided.

Will it be advisable to spend half of your salary in car? It depends on your need (or is it want If having a car adds to your cash flow but if not then it is going to be a debt for you and you are losing money by financing a property that goes down in value.

Personally I would not spend 50% of income, I feel this is a lot more comfortable at 25% or less.

I definitely agree with Qwerty on the save strategy. Delay the purchase, put your 20k a month in a savings and let it grow,in 3 and a half years time you have enough to buy a brand new car. By that time, there will be a brand new Civic model for you. If you purchase this model now, you will still be paying for it when the 2006 model body. A lot of changes can still happen between now and your purchase but when that time comes, walk proudly to your car dealer and haggle because you are paying hard cash

[Gecko Guy]

If you can afford the 50%dp and you really want an FD, then why not get a 06/07/08 civic instead? They are still practically new and a way lot cheaper. Go to Team FD site and shop around..there are FDs for sale there which are really good!

[gastromd]

Hmm.. technically, I CAN afford one. Maybe the question is it is advisable to pay half of my monthly salary on car amortization? How about you guys? How much were you making when you first bought a brand new car?

i think i've read somewhere in the other thread that you're monthly car amort should not exceed 20% of your monthly income... pero iba na when it comes to the bank, if you declare na you are earning at least 30K a month, they will approve your loan in a flash...hehe. (i might be mistaken though...)

[cokyi]

Thanks guys, this is really of big help. Yes I think I can delay the purchase a bit more and save up. I need the car basically for the daily commute to work, and to sort of get off my mom's back since I've been borrowing her car everytime I need one. Nakakahiya na din. Another option for me is to get a jazz (this one eats up a relatively smaller chunk of my salary) and pay for about 3-4 years. By the time I finish paying for it I can sell it and get a new one as well. Who knows I might be eligible for a company car by then?

But yeah I think I'd hold off getting one for another year or so.

[actor21]

tol pwede yan kaso dapat may extra ka for the PMS, Insurance (yearly ito) saka sa GAS siempre...

[cokyi]

tol pwede yan kaso dapat may extra ka for the PMS, Insurance (yearly ito) saka sa GAS siempre...

Yes natake into account ko na din ang gas, ang wala akong idea yung insurance na yearly. Alam ko lang yung first payment sa casa pagka bili. PMS around 3-5k, if im not mistaken.

[Gecko Guy]

Thanks guys, this is really of big help. Yes I think I can delay the purchase a bit more and save up. I need the car basically for the daily commute to work, and to sort of get off my mom's back since I've been borrowing her car everytime I need one. Nakakahiya na din. Another option for me is to get a jazz (this one eats up a relatively smaller chunk of my salary) and pay for about 3-4 years. By the time I finish paying for it I can sell it and get a new one as well. Who knows I might be eligible for a company car by then?

But yeah I think I'd hold off getting one for another year or so.

Good thinking if you will save first before buying a new car! Magastos ang may kotse (lalo pa at FD!) dami kasi nag-gagandahan mods out there!
Better save now and buy the car that you really want.

[Gecko Guy]

Yes natake into account ko na din ang gas, ang wala akong idea yung insurance na yearly. Alam ko lang yung first payment sa casa pagka bili. PMS around 3-5k, if im not mistaken.

If you're getting an FD....3-5k budget for PMS is not enough It can go as high as 10-12K depending on the mileage of your PMS. HTH

[parakitoJDM]

if i were u i wouldn't go with it... though i understand the urge to get your own ride esp. when ur a single guy.

simply put its not practical. its either either u buy a lower cost brand new model or buy something na 2nd. hand you can afford.

for me i wouldn't handover my hard earned cash to the banks in the form of interest payments. its not my style.

[mbenz204]

A guy, single, earning about 30k/month, nothing to pay just a monthly DSL line, no obligations.....you're one such lucky guy in that situation.
You can afford the monthly payments, but if you have the downpayment, go for it.
But once obligations starts, other payments.....marriage...family matters.....go second hand.