I never realized, I didn't really talk about the car in itself. I talked about the petrol savings and stuff like that but never really a holistic view of owning a car.
**The irony of things is... you actually OWN a car, but you don't OWN your HDB.
BUT, although you own the car, you don't have a right to drive it without a COE.
So... you're still pretty stuck in our sunny Singapore.**
Ok... let's talk about the car in itself.
A typical car's value in Singapore is pretty much...
Value of car = COE + PARF + Premium/Body price
The "Premium/Body price" is an arbitrary number which will be slowly revealed as you read on.
When you buy a new car from the dealer and you immediately want to scrap it, LTA will pay you back the COE (the COE will drop every day of usage) + PARF (the PARF value will drop every 6 months of usage)
So the "Premium/Body price" is basically the additional you pay to the dealer.
Which is why it's always better to sell your car instead of scrap the car. Cos you can get back a portion of the "Premium/Body price".
When you buy a car which is greater than 10 years. Aka COE car...
Value of car = COE + PARF + Premium/Body price
PARF = 0
Cos LTA won't give you anything back except for the unused COE.
So if I buy from a second hand dealer, I am paying him for the COE + (the body of the car + some dealer premium) for fixing it up.
Ok moving on.
There's some plus and minuses to buying a new car and 2nd hand car, and not all 2nd hand cars are the same.
I think it's well known that buying a new car is more expensive generally.
But there are benefits. You basically have recourse, you can go back to the distributor and make some noise, you get a few years of free maintenance, etc.
Whereas 2nd hand car dealers will probably adjust the mileage, make it look lower than it truly is, the car has probably met with an accident, probably needs some repairs here and there. But the monthly depreciation is lower.
So it's a give and take. You have to know what you're getting into.
The first time I bought a car, I was pretty goon-doo. Bought a cheap 2nd hand car Chevrolet Aveo 1.4L.
It was 5-6 years old, terrible. A lot of issues, but maybe I was really aggressive with my driving as well. So I think it's a bit of both. The car wasn't a durable good car and I didn't take care of it well.
Furthermore, as a newbie, I got chopped at workshops for everything. It's a learning process.
Before I got my 2nd car, I talked to a couple of neighbours. So I was asking them for a reliable car.
You see... a car isn't all about cheap. Sometimes, the inconvenience of a repair isn't really worth the stress. Having the car breakdown in the middle of the road, or have a leaky radiator isn't fun. It's scary seeing the heat gauge raise while driving and realizing that the radiator is out of water.
So I wanted a fairly cheap but reliable vehicle. And my neighbours recommended mainly the Jap cars. Toyota, Honda mainly, which would last for 20 years.
Jap cars generally also have better fuel consumption.
So my 2nd car, which is my current one, is now a Toyota Altis 1.6L. It was around 10.5 years old when I got it. It is a COE car.
COE cars typically have the lowest depreciation. But they have a higher road tax. But it's still cheaper.
We were contemplating between the Toyota Altis vs the Toyota Vios. The Vios is cheaper but the car is pretty light and flimsy, so we decided to get the bigger Altis instead for $2,000 more, over 4.5 years. Or around $37 more per month.
It's been around 2 years since I bought this car. With no required repairs. *keeping fingers crossed for the next few years* But my driving pattern has also changed, maybe cos I'm older as well. I don't push the car as hard as I used to.
Personally, I prefer owning an older car. Cos I can choose not to repair things if they can last 1-2 years more. Or if I didn't want the car anymore, I could easily scrap it for the COE value, cos the "Premium/Body price" isn't very high.
It's still a learning process of car ownership so I don't proclaim I know everything there is to know about it.
Learning points :
1) The older the car, the lower the depreciation.
2) For me, buying a reliable vehicle is important. Having to tow away the vehicle or have the vehicle breakdown is inconvenient.
3) Don't drive too aggressively.
4) Jap cars are generally more durable, fuel economical.
Moving on to fuel...
I did a post on this previously.
Most cars do not need top of the line petrol. RON92, 95, 98, VPOWER...
Most cars will do just fine with RON95.
Yes you might not have as much pick up, but the price premium for better petrol isn't worth the additional acceleration.
For me, I'm most interested in KM per dollar. Not just KM per liter.
I've tried all the fuels across SPC, SHELL, ESSO and tabulated them when I bought my 2nd car. Cos now I'm a lot more curious about these things. And I don't want to be a carrot anymore.
For RON92, my pick up was poor, but the KM/$ was the same as RON95
(statistically insignificant, differences could have been due to driving patterns or road conditions on different days.)
RON95 is the baseline recommended by the manufacturer. Acceptable acceleration, baseline fuel consumption.
RON98 is more expensive, doesn't give much additional pick up and costs around 20% more per KM. It's around 10% more expensive, BUT gives 10% less mileage.
VPOWER (only for SHELL)... now THAT'S a class on it's own... VRROOOOOOOOOMMMMM!!!!!
Between the 3 different brands of fuel, SPC, SHELL, ESSO.
The different grades did not provide any better mileage against each other.
Meaning SPC's RON95 did not provide anymore mileage vs ESSO's RON95.
Although SHELL's Fuelsave fuel appears to give between 1%-5% more mileage.
Which then leads to the available discounts using various credit cards. Cos even if there's better mileage, if a credit card gives 5% better discount, then it's better to just get a guaranteed 5% discount instead of a random 1%-5% fuel economy which might depend on many factors.
I previously did a spreadsheet on petrol discounts.
But there's been some slight changes so here's the new spreadsheet.
Caltex also isn't really good with their discounts, so I've left them out of the list.
The baseline for petrol is always POSB Everyday card at SPC.
That's the baseline price. As you can see, anything that beats the SPC + Everyday combo has conditions.
Example,
-ESSO/Shell with Citi CashBack card, can only beat SPC+Everyday, ONLY if you count the 8% cashback from the Citi card, but that requires a $888 monthly spend.
-Or SPC with Amex requires the customer to have pre-registered the credit card and be one of the first 20,000 people who registered to be eligible for the promotion.
-Or SPC with UOB One only beats SPC+Everyday, ONLY if you count the 3.33% on the UOB One card, and that requires $500 per month spend for 3 months AND ONLY during the promo period which gives $3 discount on $60 fuel purchase.
So POSB Everyday card at SPC is usually the baseline price and discount. Unless there is some voucher which will give a additional discount during some promo period.
I've just run out of discount coupons and can't find anymore for the time being. So looks like I'll be using SPC+Everyday, OR SPC+UOB One for the months where I have difficulty hitting my $500 minimum spend.
Learning points :
5) For most cars, just use RON95.
6) Baseline discount is SPC+Everyday card combo.
Next is Basic maintenance.
The most basic is engine oil and filter change.
This is usually done every 10,000km, using fully synthetic engine oil.
This is a necessity.
I found most workshops charge $70-$200 for this service. They will change the engine oil with whatever brand they are carrying, and the oil filter. Then they'll check areas of the car to recommend repairs.
Some people "feel" the difference in the different types of engine oil. So some people swear by Motul oil or whatever. For me, I FEEL the difference in my pocket. So I just go for the workshop who is going to do it the cheapest.
A common practice is for people to buy their preferred engine oil and bring it to their preferred workshop and ask them to change the oil, then they will pay the workshop for labour and the filter.
The labour and filter charges range between $20-$120.
For any basic car in Singapore, like mine, I think there should be no problem with using motor oils with grade 0w30, 5w30, 0w40, 5w40. Usually 5w30 or 5w40 is the most commonly available engine oils.
It is possible to get a cheap 5w30 in Giant (Schnell brand) for $19.90, or 5w40 (Schnell) for $24.90.
This is for 4L of engine oil for a typical car like mine.
Then bring it to a small workshop and they will charge $20 for labour AND filter.
So total cost would be $40-$45. It's possible.
But it's hard to find workshop these days willing to do it for such a price.
Also a lot of people cast doubt over the price of oil vs the quality.
They'll say things like... OOhhh you never know what's it going to do to your engine in the long run, etc etc. and they convince themselves that they NEED to buy a more expensive engine oil to ensure the engine keeps running well, etc...
We've been through this conversation before. I don't wanna repeat.
More expensive is not always better. More often than not, you are paying for the branding more than the quality of the product.
Similar case here.
Motul costs around $20 per liter, so for 4 liters, it's around $80 just for the engine oil.
I'm not saying there's no difference. Some people really feel that the drive is smoother. And that's fine.
For me, I'm ok with a good enough engine oil which is good enough for my vehicle.
The cheapest cheapest way to change engine oil and oil filter is to DIY.
But many people don't want to do it for fear of getting dirty or messing up the car. Also, engine oil is non-biodegradable and cannot be just disposed in the normal trash. So it's a bit troublesome here.
So I'm not going to cover this part.
*Wheel rotation, by right, car owners are recommended to rotate their wheels every 10,000km. This is done by moving the front wheels back and rear wheels forward. This ensures even wear on the tyres. The typical cost is $20 for wheel rotation. It's not as simple as just changing the wheels, the wheels have to be re-balanced by a machine so you can't really DIY.
With my first car, I never rotated my tires. Never had any issue with it. So I don't do it.
Not recommended as advice. Just that I don't do it.
**Tyre pressure, typical tyre pressure is around 30 PSI. This ensures a "softer" tyre so that it grips the ground and prevents hydroplaning when roads are wet.
However, with a harder tyre, there is better fuel economy. So pumping up to 36 PSI or more can help to save fuel. It's like, is it easier to roll a hard ball or a soft ball? Similarly, a high tyre pressure will help roll the car easier, but this is potentially dangerous cos there is a higher chance of slipping during wet weather. Also, if you roll over humps, harder tyres will feel the bump a lot heavier so the drive isn't as pleasant. But the pick up and drive is easier due to the harder tyres.
Once again, not recommended advice. Just some additional knowledge.
Learning points :
7) Most engine oils are the same.
8) Cheapest way is to buy your own engine oil and bring it to a cheap workshop and pay labour and filter charges.
Other expenses
Then comes the other expenses...
Road tax, you can't avoid this. Cars above 10 years old pay more road tax, but overall it's still cheaper than a new car's depreciation.
Inspection, cars younger than 10 years old only need to go once per 2 years.
Cars like mine need to go once per year.
Every inspection at VICOM or other authorized agents costs around $60.
I need to clear the inspection before I can renew my road tax.
Parking, usual HDB parking rates is around $110 per month for covered multi storey carparks.
I know people who park a few blocks away at the nearby unsheltered carpark and pay a cheaper rate.
Insurance, OK, this one is quite interesting.
For most cars, the insurance covers any accident and third party coverage.
So if a car runs into a drain. The insurance will cover the repairs, and increase the premiums.
If the car bangs into another car, this is third party coverage, so the insurance will cover both the car's own repairs and the guy who got knocked.
HOWEVER, for older cars like mine. The insurance doesn't cover own damages. It only covers third party. This is because my "premium/body price" is very very low.
Remember, the value of my car is mainly my COE + premium/body price, IF I run into a drain, the repairs may be more than the value of the "premium/body price", if that's the case, it makes sense for me to just scrap the car and just get back the COE value.
There's no sense for me to repair a car for $4,000 when the car itself is worth less than $4,000.
The insurer understands this, and understand that no one is willing to pay full price premiums to insure an old car.
It makes sense to pay $1,000 per year insurance premiums to insure a new car, cos if the car gets into a personal accident, the driver would want to repair the car.
But for an old lau-pok-chiah, if I run into a drain, I'll just scrap the car. So I won't want to pay $1,000 annually, cos I don't want to repair the car if the repairs are expensive.
The insurance still covers third party. So any accident involving someone else, the insurer will pay for the repairs for the other person's vehicle. But for my own vehicle, I'm on my own.
Long story short, due to this, my insurance premiums for my old lau-pok-chiah is significantly cheaper than normal insurance that most people pay.
This wasn't planned and it just happened after I bought the car. I found out about it and thought, "Oh that's a nice surprise..."
But of course this means that I need to be careful when I drive and make sure I don't do anything stupid.
Learning points :
9) Older cars need to do inspection more often and pay higher road tax.
10) Can potentially park further away a bit to save on monthly HDB parking at an open air carpark.
11) Insurance for COE cars are really cheap.
Misc points to know
12) Never park at Takashimaya, it's daylight robbery, park at Wisma instead.
13) CapitaMalls provide reasonable parking rates.
14) I find there's no real need to subscribe to AA membership. There's no real need for it. Just have a number of a workshop on hand if towing services are ever necessary.
15) JB is always an option to fix up your car if you know your way around.
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