Car affordability calculation is one of those necessary preparatory work that must be done before a new car purchase. Generally when we buy a car, we do not care about affordability calculation. But this is a mistake.
Car is a financial liability, but it is also a very convenient way of transportation. Moreover for many, owning a car is a huge psychological booster. Hence, people tend to overspend on their car purchase.
How to control this overspending urge? By first performing ones car affordability calculation, and then buying a car in accordance with it. I’ve also provided a simple calculator which can ease ones affordability calculation.
People who are car fans, and also remain aware of their spending habits will like my calculator. Take it as a fun calculator. When I use this calculator for myself, I’ve seen that it’s car-value predictions generally matches my actual affordability.
I’m writing for people who are likeminded as me. These are people who observe and analyse their spending habits. They like to be called as wise-spenders. But it does not mean that they spend less, they just tend to buy things after little bit of more pondering. 🙂
Their purchases always exhibit the following three philosophies:
- Value for Money: Their purchased items often strikes a balance between quality, usefulness and price. This is what makes them a value for money.
- Taste & Personality: No matter if they are buying grocery, stocks or a car, the bought items are a reflection of their taste and personality.
- Blend: Their priority is to buy the best that the market can offer. But the item must also blend perfectly with their social status. I personally give lot of emphasis to this point in my life.
In this article, we will see how we can pick a great car which is in accordance with the above three philosophies.
So lets start with my car affordability calculator…
Car Affordability Calculator
Just enter your monthly income & loan in the data entry fields, the calculator will do the affordability calculations on its own.
|Net Salary (Rs/month)||This value should be the average "MONTHLY SALARY" credited in your bank account in Last 12 months. This is not your CTC. If you are entering a value of Rs.1,00,000 - it means Rs.12,00,000 (=Rs.1,00,000x12) was credited into you salary account in last 12 months|
|Home Loan EMI (Rs/month)||If you have multiple home loans, kindly enter the cumulative value of all EMI's here.|
|Other Loan EMI (Rs/month)||If you have multiple other loans EMI, kindly enter the cumulative value of all EMI's here.|
|Maintenance Affordability Percentage||%|
|Maintenance Cost||This is the maximum value you can spend on your car maintenance per year|
|Insurance Premium Percentage||%|
|Insurance Premium Cost||This is the maximum value you can spend on your car insurance per year|
|Purchase Price of Car||Value||Remarks|
|Value of Car (Rs.Lakhs)||This is the maximum you can spend to buy a car. This value is calculated in proportion to your salary & it also considers the burden of all loans|
|Names of Cars|