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The Hidden Costs of Buying a Car in Singapore

Buying a car in Singapore does not need to be complex and headache inducing.  In fact, we can certainly gain the convenience, freedom and accessibility from owning a car as easy as 1-2-3.  But owning a car can easily put a strain on your finances, so you better know the hidden costs of buying a car in Singapore.

Two of the main reasons why buying a car in Singapore are much more expensive are the:

  • Vehicle taxes imposed on cars, including additional registration fees, road tax and importation taxes, and
  • The Vehicle Quota System that puts a ceiling to the annual rate of growth in the number of vehicles on Singaporean roads every year (currently, the maximum growth rate is set at 3%).

Another hidden cost when buying a car comes from misunderstanding a car loan’s instalment provisions.  Many consumers are lured by the promise of paying low monthly instalments.  They do not understand that there are other costs that actually make these instalment payments more expensive than it is.  What is more, most people do not factor in the fact that a car depreciates in value from the moment it is purchased.

Car ownership carries with it a monumental investment. Your finances might not be able to support having a car.  Many people think that car-related expenses stop when they sign the dotted line and pay their instalments.  But there are costs that come with car ownership aside from the price you have to pay for the car itself.  And unfortunately, Singapore remains to be one of the places where it is more expensive to own a car.

Aside from your loan instalment, you must also consider these expenses:

  • Road Tax
  • Fuel
  • Car Insurance
  • Parking
  • Electronic Road Pricing
  • Servicing
  • Car washing, cleaning and grooming
  • Inspections
  • Fines, licenses and other non-recurring fees.

Depending on how much you pay for your loan instalment, all of these expenses could easily amount to more than $1,000 per month!

Do not be in haste when buying a car in Singapore; make sure that you consider all of these factors to ensure that you would not have financial problems in the future.


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