Tips for buying your first car





Instead of splurging on an impulse, it's important to consider the financial viability of owning and selling the car

1 Cost of ownership

Young earners with easy access to credit are often swayed by the prospect of buying the hottest set of wheels. However, besides the car loan EMI, they also need to take into account the maintenance expenses, insurance premium and fuel charges. So, instead of using the entire surplus income to purchase the car, they should calculate the total cost of ownership. Setting a realistic budget is key to enjoying the ride without worrying about the next EMI payment or a rise in fuel costs.

2 Low on maintenance

You may have got a good discount and struck a good deal on your dream machine, but will it prove to be as lucrative when it comes to maintenance? Since it will be your first driving experience, it's likely that the car will pick up a few dents along the way. Will you have to wait for a week to get the maintenance work done on the car? Will you be able to get spare parts easily in case it breaks down? So, keep in mind the aftersales service of a brand before you pick a car. Popular brands with easily accessible service centres and readily available spare parts should be your best bet.

3 High resale value

It is a given that you will upgrade your car after a few years and, in all probability, sell the old one to help finance the new purchase. What will be its resale value at that time? While there is no way to arrive at an exact figure, you can get a good estimate by studying the resale value of various brands. Typically, the cars with easily available spare parts are the ones that command a high resale value. For instance, a five-year-old Opel Corsa bought for nearly `6 lakh will fetch you a little over `50,000, while a `4 lakh Hyundai Santro could get you upwards of `1 lakh. So, before you zero in on your first car, make sure you check its resalibility quotient.

4 Used car options

With the used car market becoming more organised, it is an option that first-time car buyers can explore. Maruti's True Value and Mahindra & Mahindra's First Choice wheels are two popular and reliable platforms, with Renault also set to join the club. The amount that you would ordinarily shell out to buy a hatchback could get you a used sedan with fairly decent specifications. If you want to avoid taking a car loan, a year's savings may get you a certified used car from these established platforms. When your income increases after a few years, you can always buy a new car.

5 Petrol versus diesel

This is a question most first-time car buyers grapple with. Earlier, diesel cars were an easy choice despite being more expensive, due to the lower fuel cost and higher mileage. This meant that you could recover the premium you paid within 2-3 years. Now the running cost is no longer a decisive factor because diesel prices are virtually deregulated and the price gap between the two fuels has reduced to just about `10 litre. This means that you may have to drive a diesel car for 5-6 years to recover the extra cost. So, experts say that if you have to drive less than 50 km a day, the low       maintenance petrol variant might be the better choice.