[zalaps]

My method for vehicles being depreciating asset is very simple!

1. Spend max 1 month of Salary on 2 wheelers. I got HF Deluxe in 2019 well within my monthly pay. It's a basic commuter but it brings smile on my face when I realize it's not on loan and it still offers Fill it, shut it, forget it quotient.

2. Spend max 2 months of Salary on 4 wheelers. I was earning less as per this rule. Hence, I prolonged ownership of aging Evalia till 12 years. Finally last month I got Punch Basic Petrol variant as that's the max I could get in two months of Salary!

It's not conventional but works for me.

[beemer5499]

Well I have done what no one else would have done I guess. Doesn’t make financial sense but we love cars in our family and I have no other obligations. I do not require to purchase a house and I am unmarried.

I recently bought my first self earned car at the age of 29, XEV 9E Pack 3, which got delivered just last week. The car cost me about 300% of my CTC and the EMI burden is around 41% of my monthly salary.

I plan to reduce this down to 30% of my monthly salary by part payments in a couple of months. I have no other debts. My parents too are not dependent on me financially.

I suppose my running costs for this car will be negligible, service shouldn’t cost much but resale is a grey area. Also I doubt driving this car will cause an itch to upgrade any time soon so longevity wise it’s a good purchase.

My criteria was that the EMI + running cost burden shouldn’t compromise my lifestyle at all.

Also, I work in a profile where it is possible to earn upto 20 lakhs of incentives in a financial year. These incentives are obviously taxable but still it is a decent amount.

[shankz]

The more you age , the more practicality you try to find in the car you purchase

- Will my kid's stroller fit ?
- Will it be comfy for my ageing parents ?
- Will it give me servicing nightmares ?

For both my 1st & 2nd cars taken 12 cars apart (Hyundai i10 1.1 , Kia Sonet HTX iMT) : About 20% of my annual CTC.

[gopa99]

Originally Posted by DieselLover

Today, I have just booked Maruti Invicto Alpha+ .

Why wouldn’t you have looked at its Toyota cousin considering it might fetch a better resale value 5 to 7 years from now? I am putting on my financial lens now as I ask you this question

[EvilZombie]

My 1st car (now sold) was bought at approx 30% of my CTC back in 2014, 2nd (daily driver) was about 25% (2019) and 3rd (for spouse) was about 15% (2022)

The first two cars were new and financed, while the third was cash down and pre loved.

If I have to buy a car in future, I will try to go cash down and preferably pre loved route of possible. I would like to spend less than 20% of my CTC, and hopefully keep her for atleast 7-8 yrs.

Now assuming my plans don't work out and if I have to buy new, I will probably go for something that I can pay upfront atleast 60% and rest on finance. But I may go conservative and cut down my budget a bit to reduce the load of emi.

[terra85]

Am 40 years old, for a long time I wanted a BMW/ Mercedes. I moved to the middle east for work . Both my wife and me are working . Our commute is very less hence got ourselves a Ford Territory and i10 . It comes to just about 2- 3 months salary. Will hang on for atleast a couple of years. That BMW doesn't hold any aspirational value anymore , I guess an age thing. Just want to get to the financial goal ASAP.

[L8ButV8]

My rule of thumb is that I should buy 2-3 pieces of the car cash down with 0 thought. This has meant buying significantly used (even being 6th owner)/cheap cars at the start of my career. But that's changed over time. In total, I have never spent >5% of my annual earnings on a car.

I do not want the headache of worrying about issues to the car -- scratches, accidents, even car theft which has happened to me. As much as I enjoy the cars I have, I enjoy my peace of mind many times more.

[DieselLover]

Originally Posted by gopa99

Why wouldn’t you have looked at its Toyota cousin considering it might fetch a better resale value 5 to 7 years from now? I am putting on my financial lens now as I ask you this question

Well, multiple reasons:
1. I will keep the car for 10+yrs and resale doesn't really matter. My duster is 11yr old now.
2. Invicto and Hycross and essentially same and I really don't care about toyota brand/snob value.
3. Value for money- got Alpha+ for 34L after discounts while hycross VXO was quoted at close to 40L with no discounts
4. Waiting period for hycross: 4 to 8 months for hybrid and 12 months for petrol. I wanted a car by June.

[shankar.balan]

Originally Posted by terra85

Am 40 years old, for a long time I wanted a BMW/ Mercedes. I moved to the middle east for work . Both my wife and me are working . That BMW doesn't hold any aspirational value anymore , I guess an age thing. Just want to get to the financial goal ASAP.

Actually you’re absolutely right. Age and maturity as well as the ever changing life priorities makes for a lot of influence in car related aspirations.

Looking around here even in India, the BMW or Mercedes or Audi brands are commonplace and ubiquitous. The aspiration levels that they inspire have come down.

In the 1980’s and 1990’s and early 2000’s, if someone owned any of these brands, they really were at the top of the heap. Because in India at least one simply had to be really wealthy to buy one, considering the absence of hire purchase.

Hire purchase schemes and easy loans have democratised ownership of these marques and created a proliferation in the market and just like abroad, the used market is full of very affordable examples, even if these are slightly older.
Hence more or less anyone can buy and own one of these.

This has significantly reduced the ‘snob value’ and ‘street cred’.

So therefore, from the point of view of prudence, what you have decided to do or indeed, done, is very smart. Hit your financial goals as quickly as you can. Then sit back and enjoy the things you really love and want.

A car is only one part of this. But it is worth making a head+heart based decision when choosing it - because this too, will be a part of the ‘enjoyment’ process that you have ‘earned’.

Another thing, the chase is usually much much more enjoyable than the actual catch.

[terra85]

Originally Posted by shankar.balan

Another thing, the chase is usually much much more enjoyable than the actual catch.

Yes well said once you get anything the novelty wears off quickly, its important to look back after buying something expensive as to how much usefulness it has brought , that's the difference in feeling rich I.e owning stuff vs being wealthy.

The ability to resist clicking on the buy button is a superpower.

Hence as suggested by other members we should have ideally car lifetime goals, keep car for a minimum of let's say 7-8 yrs , 10 maybe difficult .

[SnS_12]

Originally Posted by StrykerEV05

I'm 27 years old, bought my 1st Car (Nexon EV) around 3.5 years back. I've loved cars from my childhood and the feeling has gotten stronger with age. While buying the Nexon EV, after the 2.5 lakh early bird subsidy the on-road price was almost 100% of my take home (post tax) and about 70% of my CTC that year. It was a heart over head decision back then for sure.

Now after more than 40 months with the car and seeing the rapid evolution in EVs, I'm having the itch to upgrade. I'm thinking of upgrading to BE 6E Pack 3 which would cost me 28-29L on road in Mumbai.

At the age of 27 you have already set up your self well with buying a big house and a car in a city like Mumbai where people in their mid 30’s still struggle to achieve. You have already bought a highly depreciating asset on borrowed money so don’t do that mistake again because once you do the maths on how much the vehicle has actually costed you (loan interest amount being the big factor) and what you’re getting as a selling price you end up learning that you have put good money behind bad..

Originally Posted by StrykerEV05

In addition to the above I have about 30-35 lakhs in my savings + investments currently (lost about 5-6 lakhs in the recent downfall). I think I can afford the car but that's going to wipe out all my savings so far. Also the on road cost of the car is about 70% of my CTC and let's say about 110% of my take home currently.

So my home loan EMI + this car lease would take up almost 82-83% of my in-hand income.

The savings and investment you have despite two big loans is really commendable and especially for your age but you have to realise that with the current car itself your financially in a hand to mouth situation and by your own calculation if the % is going to as high as 83% with the new car you will end up eating up your savings and investments very soon as expenses just keep pilling up and salary growth not always can keep pace and especially when your family expands and that is when 10 years down the line you will realise it wasn’t one of the wise financial decisions.. Best approach will be to reduce your home loan burden as soon as possible as money saved (loan interest payment) is money earned…

[PrasannaDhana]

Reading all responses in this thread, I think I will have to retain my Altroz diesel till 2050.

I genuinely think I had overspent on cars when I read about CTCs and the subsequent car purchases shared by other BHPians.

[.HEM]

It purely depends upon your financials! When I bought my Ertiga VDI in 2013, I was employed and My CTC was 8 lakhs/annum. The OTR cost was Rs. 9.6 lakhs with all accessories. I paid 2 lakhs downpayment and the remaining was loan for 7 years. But I did not have any other commitments.
Fast forward to 2025, I became an Entrepreneur in 2015 and I still drive the Ertiga and the next cars I bought was all for pure joy and passion. All my cars after Ertiga was used and not new. Thanks to Team-bhp

[aswin88]

A very interesting thread and thought provoking indeed. My mantra has been very simple.

1. Do not buy any depreciating asset on EMI. Avoid taking bad loans - car, bike, phone, appliances etc.
2. Loans should be taken for anything that can be used to multiply your wealth. Home loan, education loan, loan for buying plots (if researched well) are good loans.

Fortunately, I was able to follow these right from the start of my career.
1. At 22, bought myself a 2 wheeler that costed me 6 months of my take home salary. Saved money for 15 months to buy the bike.
2. At 27, bought my first car that costed me 40% of my take home salary. Did some aggressive savings before marriage to finance the car without loan.
3. At 36, upgraded my car that costed me 30% of me take home salary (23% if I account my spouse take home salary).

I wish to continue this basic fundamentals to build wealth and at the same time enjoy it to an extent. In terms of liquid assets (apart from real estate, gold), have been able to accumulate 3x of our combined annual take home salary.

[bnkmp]

We are a DINK couple and bought our car at 28. Its a Honda Elevate that costed 19.5L OTR which was slightly more than my individual post tax salary (60% combined). We could have definitely bought something cheaper around 13L but somehow did not like any of them. The only reason we went above was because my wife had a car lease option. Happy with the purchase, the extra boot space was very useful during long drives with our friends.