It’s is perhaps the most defining question in the corporate capitalist world that we live in! From property to high fashion, luxury vacations to tech gizmos – in this day and age of instantaneous gratification – buy today, shipped tomorrow, online everything; the lines between our wants and needs are more blurred than ever. It is no different when it comes to cars, so how do you choose between a car your heart desires and the ideal vehicle that will suffice 95 percent of the time?
Buying a car is quite a bit different from buying a smartphone or a watch – for one it’s the second-biggest financial decision after property for a large portion of the market. Add to that the tie-down of loan tenure, monthly instalments and maintenance costs, and you begin to understand why a car is perhaps not something you should gamble with unless you have a good amount of auxiliary funds.
Is a cool car your best calling card?
Besides getting from A to B, a car has come to mean so much more in our current social constructs – for one it signifies your financial and career success, it exhibits your personal style, some buy cars because of how they perform, and in some cases, it’s even a simple case of one-upmanship. How many times have you heard, “I bought the Honda Accord because my neighbour bought the Honda Civic”?
Therefore, it is always a case of getting bigger, cooler, and more powerful wheels. However, there is always a balance between what you can comfortably afford (and gets the job done) versus financially stretching yourself to scratch an itch you might have or gain the adoration of your peers. Though we are not telling you that you should not strive for better things in life, and drive awesome cars – you have to factor in some considerations before you choose to buy with your heart and not your mind.
What do you mean by buying a car with your heart versus your mind?
I’ll give you an example, for my small family of three, I KNOW the perfect car for me and my family is a Honda HR-V – it offers sublime practicality and packaging, its well-priced, great to drive, offers good performance and fuel economy, and is extremely easy to maintain. This is the pragmatic option.
However, for the approximate price of a new HR-V, I COULD get a used (F30) BMW 328i M Sport – this is what my heart wants! Hey, it still has four doors and a boot, and when the mood takes you – 245hp of stellar turbocharged power, hallmark BMW driving dynamics and all the presence when I need to bawa ke majlis. What’s not to like?
However, as we all know, the BMW 330i will be more expensive to maintain, fuel and run, it may require immediate repairs because it’s a used car, and will suffer from more depreciation because, well… it’s a BMW and not a Honda or Toyota.
So, which should I choose?
Well, that’s up to you – as a rule of thumb whatever car you buy – we believe it should not cost more than 15-20 percent of your income/salary every month to finance, maintain and keep running in a safe orderly fashion. This means if you earn RM4,000 a month – it should cost no more RM600 - RM800 every month to keep your car going.
Let’s break that down, for RM800 a month:
- Car financing/instalments: RM400
- Fuelling costs: RM200
- Maintenance costs/month: RM100 (save this every month, regardless if you need to service your car or change your tyres, you already have cash on standby)
- Miscellaneous costs: RM100 (perhaps for toll charges and car washes, etc.)
From the above figures, you can already see that even if you earn RM4,000 a month, the sensible car for you to own is a Perodua Axia or Myvi. Now if you buy something that is more flashy or faster – it is wise to double or even triple that maintenance cost allocation.
To hell with sensibility, ‘YOLO’, how do I know if I can afford my dream car?
Ask yourself two simple questions:
- Can I afford to change the tyres of my dream car? By this, I mean, buying the (manufacturer rated) CORRECT tyre and type from a notable tyre manufacturer for your dream car.
Let’s use my example again:
- The second question is what good is having my dream car if I cannot maintain it properly to truly enjoy what it can do?
It pays to do your homework before you decide to buy with your heart because regardless of how it may make you look or feel, your finances, for the most part, is finite and money doesn’t grow on trees, as they say!
Before buying your dream car, also consider if you have the resources to maintain and source parts as needed to ensure its upkeep.
What about getting a compromise between the two? Well, you might be surprised, but there is a car that balances what I personally need and the car that I want: it’s called the Honda Civic (no, we were not paid to say this). For about the same price – I could get a sleek-looking turbocharged four-door sedan, with a spacious interior for the family, palatable maintenance costs and driving dynamics and performance that 90 percent of the time – will still put a smile on my face. Voila!
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