What are the financial considerations for 25 year old when planning to buy a new car?

Sometimes, a car is a dream and a passion. In this case I would want you to consider the 20/4/10 rule.

​

This means you must be able to put down at least 20% of the vehicle value for your downpayment, you must be able to finance the vehicle for no more than 4 years, and keep total transportation costs to no more than 10% of your total monthly income!

​

I believe it is also important to note that with a car loan, it eats into your TDSR, which may affect how much loan you can take out in the future.

I think it's possible. My bf bought a second hand avante for $14,000, and it's quite a steal. Road tax and petrol and everything add up to around $5-6k a year. It's quite manageable imo!

From most of the answers and common wisdom on SG financial blogs etc, you'll probably gather that owning a car will set you back by at least $1k-$1.5k a month.

I think the fundamental question to ask yourself is whether you will be travelling that much, such that your monthly cab fare (assuming you need to attend meetings around the island daily) will exceed the monthly instalment on your car.

No hard and fast rules for this. Your public transport and cab costs can vary, whereas monthly car costs are usually not less than $X amount. So generally, a car is more worth your money when your transport costs are very high (and cannot be adjusted, because for example, your daily work looks like: 8am meeting at Jurong, 11am meeting at Tampines, 3pm meeting at Choa Chu Kang).

1) Monthly installment

2) Fuel

3) Maintenance

4) Accidents

5) Season Parking

6) ERP

7) Wear and Tear

8) Emergency funds to sustain