[GutsyGibbon]

Originally Posted by rajushank84

Its not a matter of salary, its a matter of net-worth. Some people have zero salary and buy cars with cash .

True that. More so for people with stock grants and employee stock purchase plans. If one does a cash out on a stock spike, they could splurge on anything, without touching a penny from their regular salary. Regular salary can stay committed to an investment plan/disciplined saving plan.

[jetsetgo08]

Originally Posted by amtak

Have the salaries really gone up by that much? I understand that loans are easily available, but has the SUV race enabled the tendency to cut it too thin on savings front?

Good observation. I would say there are 2 ways to look at it. Since the pandemic, people have become either -

• Rebellious due to restrictions being placed and want to enjoy their life to the fullest. They do not mind taking big loans to fulfill their desires. They would not mind to default the loan as well.
• Defensive, foreseeing rainy days ahead, postpone all big purchases for an indefinite time.

The salaries for some IT folks have gone through the roof. Due to the shortage of man power with special skill sets in the IT industry, some companies are ready to pay CTC's up to 5x-10x of the Employee's experience. Posted a link below referring to the same.

Link

[adimicra]

Looking at some of the replies in this thread, I should be having at least a BMW 5 series but I drive a humble Vento TSI.

Obviously, it's a personal choice on how much to spend on a car and it depends on income, life goals, family support etc. But, my sincere advice, particularly to youngsters is NOT to stretch your budget too much for a car. If you want to buy the car of your dreams, work hard, invest, save and buy it when it's comfortably within your budget, even if you have to wait for a few years. And NEVER ever take out money from your savings targeted for your retirement/home to buy something like a car. If you are meeting your investment/saving goals and have some surplus, sure, go ahead and splurge on a car of your choice.

Personally, I have been thinking of buying a luxury car lately. I can spend up to 50-60 Lakhs but that would be stretching my budget. So, I have decided to wait for a couple of years. Another thing which is bothering me as I am looking into entry level luxury cars (BMW 3 series, X1, Mercedes GLA/C series, Audi A4, Q3 etc), I see a huge diminishing return on the additional money spent. I mean a Skoda Octavia or Superb can give you almost everything or something more than what you get in these luxury cars at a much lower price. Yes, there will be some areas where luxury cars will feel more premium but I think the primary reason people buy these is for snob value and show-off, to make sure that people around you know that you have arrived and that you are a successful and rich person. No offence meant to luxury car owners, this is normal human tendency which I have and which I am trying hard to resist.

Long story short, even if you love driving, don't stretch your budget for a car that it affects your other long-term and more important life goals like - retirement, home, children education or marriage etc.

[JediKnight]

I have decided to live a simple middle class lifestyle irrespective of the money I make.

This principle applies to cars as well. A good reliable safe car with some tasteful modifications is all I want.

I have no intention to impress anyone or prove anything. I would rather give some money to charity and improve my karma. But that's only me. To each his own.

[yogishkamath]

Personally, I follow these rules:

1) Do not spend more than 50% of your annual income after taxes on a depreciating asset.
2) If you cannot afford it without a loan, you cannot afford it at all.
3) Drive it until it becomes a clunker.

My first car was a used Wagon R that I bought 6 months after I started working (I did not take a loan). I owned it for 12 years.

I have actually not bought another car and survive on a borrowed Ignis at the moment (the owner will want it back in 6 months or so).

This time, I started with a budget of 55 lakhs and wanted to get my hands on a luxury SUV.

The problem is that for 55 lakhs OTR you cannot get a spacious luxury SUV in our country. They cost over 70 lakhs in Bangalore and don't feel like enough value for money.

So, I decided to save some money and shop in the non-luxury 'D1' segment.

Unfortunately, even here, it is hard to get a product at the moment which you can take home and feel completely happy and at peace.

The new Tucson is a year away, the XUV700 is probably a year away from being niggle free , the Alcazar is not safe enough, the jeep compass is barely big enough to make the segment and the top-end Safari looks like it was designed for somebody masquerading as a Sheikh.

[ashis89]

This post reminded of this What Car @what salary thread. Is Maruti hoping that a household with income of 1.5L will afford to buy a 25-35 lakh Innova? Even the target age group of 35-45 seems low for the car model. I wonder if it is a case of wrong targeting.


A snippet of the interview about Invicto:

When asked about the target group for this model, Srivastava said, “They fall in the age bracket of 35-45 years and are married or someone with a joint family. The monthly household income will be about Rs 1,50,000 plus, which would be much higher than the industry average. In terms of buying types, they are additional car or replacement car buyers than first-time buyers.”

Source: https://www.moneycontrol.com/news/bu...-10790981.html

[NomadSK]

What a lovely old thread, I have come across. Even after being a silent visitor on this forum for over a decade, I missed this thread before. And just now have gone through all the comments and everyone’s perspective about the cars @ certain salary.

Everybody has his own monetary commitments. With time I have realized, when my bank balance was light, my eyes were on the high-end luxurious cars, Now, When I can afford one, my priorities have changed. In fact, an older, mechanically strong car gives me an advantage of stress-free driving. Now, I would prefer to rent these cars for my road trips with good infrastucture to enjoy them fully.

When in India, I took a car on loan for a period of 3 years and paid it off in a year. The annoyance for having money on my head kept giving me sleepless nights. Same is the case with the home loan. Owing money to someone is a psychological stress.

[amtak]

Originally Posted by amtak

I have loans, if I close them, Linea/Accent/I20/Jazz etc category. Right now, I cannot even afford a Nano!

Responding to a 13 year old post of mine

Things really haven't changed over the years. I am debt free in all practical senses. Have bought a few homes over the years, closed the loans. Did all sorts of "car-fun" in the name of YOLO during lockdown. Sold and bought cars like I am a dealer. Lockdown ended and better sense prevailed; Having sold all cars and drive only 1 now.

This car, again is strictly well within 12% of my compensation bracket in terms of annual outflow. Will I buy a car that's more than 20%-25% in terms of my annual compensation? Perhaps not (unless another lockdown hits us).

[DCEite]

Originally Posted by JediKnight

I have decided to live a simple middle class lifestyle irrespective of the money I make.

This principle applies to cars as well. A good reliable safe car with some tasteful modifications is all I want.

I have no intention to impress anyone or prove anything. I would rather give some money to charity and improve my karma. But that's only me. To each his own.

Well, your thinking is right. But remember, as long as you on the Indian roads, you will always be judged, trolled, bullied and intimidated if you are in a cheap car. That is why SUV or SUVish cars with "road presence" sell. Don't believe me ? Take a look at this thread and most of the replies affirm that indeed size does matter, atleast on the Indian roads:

https://www.team-bhp.com/forum/shift...cles-road.html (Do *you* get intimidated/bullied by larger vehicles on the road?)

P.S. I concur your views regarding buying something that fulfills one's needs, but then we need to consider two points : 1) The fun of driving fast/large/expensive cars (This is Team-BHP afterall), and the 2) Respect you get on the roads while driving big bulky SUVs, that respect automatically translates to better drive quality and mental peace.

[Nav-i-gator]

Originally Posted by DCEite

2) Respect you get on the roads while driving big bulky SUVs, that respect automatically translates to better drive quality and mental peace.

I’m sorry but it can’t be called respect in any sense
What a big bulky SUV gets while pushing/bullying its way through the traffic is, at best, a lot of curses/malediction

[DCEite]

Originally Posted by Nav-i-gator

I’m sorry but it can’t be called respect in any sense
What a big bulky SUV gets while pushing/bullying its way through the traffic is, at best, a lot of curses/malediction

Maybe your thinking (and, to be honest, my also), but in the end, we are surrounded 95% in the road by people who associate bigger vehicles with more class, more power and something to avoid confrontation with.

Whether we like it or not, its another matter. But, we cannot change mass Indian psychology, unfortunately.

[Nav-i-gator]

Originally Posted by DCEite

Maybe your thinking (and, to be honest, my also), but in the end, we are surrounded 95% in the road by people who associate bigger vehicles with more class, more power and something to avoid confrontation with.

Whether we like it or not, its another matter. But, we cannot change mass Indian psychology, unfortunately.

More power and something to avoid yes. But more class?

Unfortunately, just like corruption, we have made bullying a socially acceptable thing. What we need is to avoid, abhor and dehumanise such behaviour.

Sorry, nothing against you or what you said. Just my personal rant.
I love SUVs, but not for this reason.

[vishnurp99]

Honestly the way to think about buying a car on a salary in India is that you are doing some kind of social service.

You pay the manufacturer about X amount. You pay the government another 1.5 X.. So if you are on a salary, decide how much social service you want to do. My recommendation is to keep it to less than 20% of the CTC & buy pre-owned. It's best to do social service directly

Now highly qualified professionals like doctors, Directors/VPs, Consulting Partners may be able to classify the salary as professional charges. By doing this, you will essentially get around 30% of the money you pay for a car refunded in terms of tax rebate. If you are in this category, go up to say 40-50% or so. You will stay end up paying more more most of these cars than what you would pay in Europe or US or the middle east.

Now for a few folks, the size of the car directly translates to eminence in the field. For eg : In private hospitals the most expensive cars generally belong to the most successful doctor ; or atleast that's what people believe.If you take this seriously, then you could go even higher.

[ZMG]

Hi Guys

I was wondering that in Bangalore Koramangla - I hardly see anyone driving a Swift, let alone an Alto.
Almost every other car is a Creta, Seltos etc.
For the salaried class:
How much do people really make to buy a 20 - 25L rupee car? More than just earning that much salary what % of your net worth should your car be?
Also net worth measured in terms of what - assets which can become liquid easily (equity, MFs etc) or a house (which has an emotional value, and you maybe super rich on paper)?

[Axe77]

Originally Posted by ZMG

For the salaried class:
How much do people really make to buy a 20 - 25L rupee car? More than just earning that much salary what % of your net worth should your car be?

I can’t speak for other people but I would not feel comfortable spending 20 - 25L on a car unless the gross household salary was at least 60 - 75L per annum. Probably more if you also are planning to buy or have currently purchased a home for which EMIs are flowing out.

Hard to peg these things to percentage of net worth as that can vary drastically depending on your age and also how many years of earning you have ahead as well as behind you. Both factors are relevant.