Rule for buying a car!

[@prathameshrathi3866]

By this rule I can't even afford Nano... 10% seems way too steep.

[@kudlalive]

You don't need a car If 10% doesn't buy a nano

[@prathameshrathi3866]

@@kudlalive with all due respect .... That may be true but it kinda hurt... 😂

[@kudlalive]

@@prathameshrathi3866 but after few years it will help you buy a grander car for sure. Just stick with financial basics

[@craigslist1323]

Does this man ever sleep?! Great videos, keep it coming

[@classicfitness8478]

By that logic a person earning less that 30lacs per year can’t buy new car? I think that’s too impractical rule. While we have to be very careful with loan and EMIs, and financial stability is important, having a great retirement plan with a pathetic life lived during young is of no use. There should be balance in life. Extremes at both ends are bad!! 😊 My suggestion is never cross 30% of your monthly salary on total EMIs. That should do the balance. And people have many different reasons to buy a car. For some it is need. For some it is passion. For some it is showing off to others (very bad reason). So looking at car as bad expense always is not right. Living life with joy and harmony and good health is very important, not just living alive and looking forward towards retirement and then having no strength nor taste towards anything 😊 .

[@leemafashion6628]

Sometimes it is peer pressure,it is not that easy when you are looked down,when you do not have a car.The incidents can shatter one confidence.

[@HomeschoolTapasvi7842]

Super

[@amoghharsha]

Good insight sir. However I feel, you will end up spending additional 20K annually on repair on a 1.5 lakhs car. Would be better off to buy a new car and keep it for 10 years.

[@cuptvs]

10% of your Gross Annual income? There is no car in that price ! 😇

[@Daya.Shankar.Kushwah]

हा तो मत लो

[@SUBRAMONEYPV]

aisa math boliye sir. If people do not buy Luxury car how will my Maruti share's price go up? I need people who spend beyond their capacity.

[@juvinantony5929]

@@SUBRAMONEYPV because people save money and risk their lifes with cheap and unsafe cars. And the crash tests of those cars are 0. Even same car models , when launched in india, they cut down safety factors as people are ready to buy . If ITC share go up because people are all smoking, that doesn't make smoking a good thing.

[@craigslist1323]

@@juvinantony5929 I think you don't understand that traveling in alto with 3 people is safer than 3 people on a scooter. The common man you are talking about can only buy an unsafe scooter and they will stretch to buy an alto precisely for the "safety" of a car. But I understand that buying a Altroz is better than a swift... I think maruthi with change to market needs soon

[@juvinantony5929]

@@craigslist1323 he is saying a person with a minimum 30lakh annual income only should buy alto(3L). So do you think a person with 30L is the "common" man? As per his logic , a person should buy altroz(9L) if he earns 90L per year . You think that a logical idea? I dont think so.

[@PrasadSignor]

I'm was browsing for buying car and I see this video 😀

[@kudlalive]

Now your browsing job to increase salary?

[@rameshassudaney5190]

Subra's advise is as always as crisp and clear

[@amitkaushal3169]

10% is very less. 20% is practical on car.

[@classicfitness8478]

Also, wanted to add one more thing. Most of the examples and profiles we hear in this channel and also most of other finance advisors channels are very higher income earning examples. Everything above 25 or 30 lakhs above per year. Honestly let’s ask ourselves, In our country, what is the percentage of people in that income range? Maximum people are below that range. Can we make more videos on how a common man earning between 15k to 30k per month can live a happy and content life with good retirement plan as well? 😊 . God bless you sir 😂

[@raunaksingh4144]

15k to 30k income means they r just fighting for survival

[@classicfitness8478]

@@raunaksingh4144 yes, but that’s where majority of people are!! 😊

[@PavanMehta]

@@classicfitness8478 very few people in this range would understand or would consume such content on KZbin. Those are the ones who need is the most. Ain't that ironical.

[@classicfitness8478]

@@PavanMehta yes 😊

[@kushalsenlaskar]

People earning less than 25 or 30 lakhs should not waste there time on KZbin. They should rather utilise there time to increase there salary. Jokes apart, but yes you are true. Just curious to know the percentage of population earning in 10-15L, 15-20L and so on 🤭

[@harshgoel1793]

This is what we call generation gap. By same logic my father till wants wo use his old Nokia 1100. You travel in Indian trains and buses. I am buying myself a 🚗

[@SUBRAMONEYPV]

as long as you stay with your parents without paying for lodging and boarding, all your income is available to buy phones, gadgets, cars, holidays, ...lucky you.

[@santunubhaduri5353]

Sir ..apne pura dil dukha diya...😂😂.I thought of buying an Alto 800.But having an annual income of less than 10 lac...the 10% rule will resist me to do so...😂

[@sudvlog2413]

Go and buy second hand Alto 😂

[@shejwalkarhemant3110]

Sir your criteria ob buying car is spot on!! I have set another condition for myself. 1.I have to have atleast 20 times the value of car invested in diverse instruments. 2. Never ever to buy an automobile with loan. That's the worst decision one can take.

[@DrKallalPramanik]

Subra sir, What is the purpose of 10cr portfolio at retirement at the cost of family's safety? With this ardous rule, what fraction of Indians could afford a car with ABS and air bags within 10% of annual gross salary? Any idea, how your stocks in Tata and Maruti would do?

[@Sp-le4oy]

Check Tata motors share now :-p

[@George__Costanza]

I agree, absolutely retarded rule. 10% huh what a joke!

[@pushpasrinivasan7313]

Dodo

[@Jyyo]

@@Sp-le4oy I shorted Tata motors and bought myself a Skoda 😂

[@atorbfire]

Imagine the Indian scenario. Two Bank senior managers , husband and wife getting a CTC of 15L each . As per the 10% rule they can only afford a Car worth 3L. Which car will they buy , tata Nano? Then who is eligible to buy a Maruti Swift (Only the CEOs can buy a Honda city)? Many times these rules don't make sense. People away from the city needs to buy a car because in case of an emergency they cannot wait 10..20..30 minutes for a taxi to arrive, no need to mention if its midnight. A car sold after 5 years will fetch at-least half the original price, plus the cost of fuel + service=/ insurance will always be less than paying for a taxi each time if you need the Car everyday.

[@GreenDriveIndia]

This seems too harsh, but according to me 6 month salary should be good for a car.

[@ankitvishwakarma5897]

Well here I don't agree completely. There are many rural areas where we don't have good transportation facilities. The fact that people stays there is because they work in any industry or minc in rural areas. To reach the nearest railway/bus station, private taxi is the only reliable way which may costs unfair. Even if person is earning 10 lacs, he needs to buy a car which will actually save money in longer run. I think this rule works for metro cities, where good transportation facilities are available and also people spend a lot of money on entertainment which is totally opposite for the person who stays in rural areas.

[@rakshan769]

All he says is buy a car not exceeding 10% of CTC..he did not say do not buy a car.. you can still go for second hand car...

[@amwings]

I feel the right metric is (5-10% of the annual income * number of years u expect to use the car). A flat 10% of annual income is not possible / practical in currently.

[@theankitrajput]

How much one should spend on a car depends on his personal family conditions and no. of dependents. For instance, someone who has a family to look can find it hard to put more than 10% of his salary in cars but someone who is on his own only and has family backup for adverse condition can afford 80% of his salary into cars

[@raghav_rr]

Excellent advice. In Chennai for instance, where ola/uber is horrible, we can see raise of Fast track / Ravi brothers travels from ashes. They are expensive but very reliable on long run.

[@AshwinPrabhuB]

Please explain how you derived the number 10%. why not 5 or 20 or some other X%. What is the inherent logic behind the generic number? Kindly explain the logic behind the reasoning to help retain and cement the mindset, else this would end up being yet another 10 min wasted for you and us together.

[@SS-yn3qu]

I think it is like this : 60% investment, 30% living expenses, 5% for entertainment, 5% for miscellaneous.- including car, it's annual maintenance , petrol+ insurance etc One can always adjust the % allocation to car as per his /her needs, but point is that it should not be too heavy as to eat into investment.

[@engineerv3248]

Sir, safety first, then the rule of 10% or may be 20% of annual salary is realistic number.

[@mehulsangani5266]

"medical education will cost you 1.5 cr"- that is if you want to purchase a medical seat in a private medical college...but for those who earn a medical seat in a govt medical college, the fees is less than that for a course at IITs.

[@drmrahul]

even with merit u may get admitted to private colleges. The fees are between 15 to 22 lakhs per year. add hostel fee! mess fee, instruments, books and other fees. it comes to atleast 1 crore now for mbbs. Dont kno what happens after 10 years. In govt colleges seats are too few and even some are reserved for so called reserved caste. Pity this still applies in india

[@leemafashion6628]

If you get in to govt medical institute then it is pretty cheap.

[@nationalist11]

Reminds me of a meme. "Reservation " Sab ko nahi milta laxman.

[@ashishyadav3609]

I think total cost of ownership of the car should be considered. Thus insurance, registration and annual fuel expense for the desired number of years should be estimated. This can than be matched to max you want to spend on cars per year. Eg: A person earning 10 lakhs can buy a car worth seven lacs and spend 1 lakh each year on the car. He can than sell it of for 2-3 lac after 6 years. In this way he would be spending 15-20% only, that too on a good, reliable and safe car. Meanwhile his salary would increase too thus for period of 6 years his average cost might go below 10% only

[@shejwalkarhemant3110]

You have nailed it sir ji. I had set a converse rule similar to your guidelines. Buy a vehicle only if you have 20 times savings of the cost of your desired car. Buying car for car is most dumb decision on can make

[@sivadasbalakrishnan5711]

Great insights !

[@Sameer-er3wz]

Sir, what if I have no other loans or any other vehicles? Would my savings become a factor in deciding the cost of the car?

[@gopinath_ravi]

Even if you buy a low cost car, think about safety. minimum 4*. Your life > your asset.

[@bprashanth14]

A good advice, although a difficult one to follow. But, yeah, Financial Independence is not easy!

[@rohansinha9737]

I was planning to buy xuv 700 A7. After watching this video, a simple ALTO seems an ideal buy😄🤣🤣

[@SUBRAMONEYPV]

Good choice...but Tata Motors surely has better models - and EV too.

[@rohansinha9737]

@@SUBRAMONEYPV yes sir. Your insights keep your followers grounded. Love listening to you.

[@dave_cj]

Never Never Never buy a second hand car unless you've expert eye for Automobile or a loyal mechanic for guidance. Else you will end up losing a bunch of money just on repairs and maintenance.

[@srinivascnp]

I think its better to do with 5-6% of net worth. e.g. for 1 crore net worth, we can buy entry level car

[@MohanKumar-wp8kc]

appreaciate it

[@vikramnatarajan2857]

Ideal advise; he is telling that hold the depreciating asset for 10 - 12 years and more. avoid frequent changes < 3y of cars. That's when the maximum depreciation is

[@baskarv90]

Sir i completely agree on ur points, at a MICRO level. If many people follow this approach, how will the economy grow and where will earnigs growth happen for the investments to provide higher returns. If people dont spend, only better way is to divert towards financial assets. So how will that money be put to use. End of day ultimate economic growth is nothing but higher sales of good and services.

[@SUBRAMONEYPV]

Yes of course. Choose whatever you wish. About 9000 people watch my video. You think I can influence 100 crore people of this country? I love consumers.

[@shubhamchhabra8844]

Your knowledge is amazing sir...hattsoff to your financial education... I'll follow you as my ideol guru 🙏🙏

[@krthicool]

I hope I can make my wife watch this video... Convincing wife on early retirement is worse Bearing emis🤪🤪🤪🤪

[@nitishgupta6463]

Is it 10% before or after tax ? 😁

[@kingbing3315]

This perspective was very much different...... I still couldn't digest this thumb rule of 10%......but my full respect to sir, we learn so many things from you...... But my perspective is like....."चाहे कितना भी save और invest करू ambani ,adani थोड़ी बन पाऊँगा..... 30 lakh per annum se मेरे हिसाब से 15 lakh का car to be driven for 6 years( that is basically 1.8 crore ki income se 15 lakh ka gari) आराम से afford कर सकते हैं ... Given health is covered....."

[@adityatripathy8868]

Since a car is purchased once in 5 or 6 years one can buy a car costing 20 percent of annual income if it is upwards of 4 cr, particularly over the last 5 years. All this provided you enjoy driving. Safety of the occupants is also important and the big German brands do provide it . I think more than percentages the absolute income and net assets and liabilities are more important in the decision making process. Request your views on my thoughts Mr Subra. Thx

[@uditjain07]

100% agree.

[@pinkynandi8894]

My father friend earn 24cr annually but drive Toyota Innova .

[@UPAKHOSALA]

Thank you very much for sharing your experience, can u give us details,as how many AUTOMOBILES does ur father own?

[@UPAKHOSALA]

Thank you very much for sharing this FANTASTIC video with everyone. Please share your experience with us

[@SUBRAMONEYPV]

Thank you, I will

[@drmrahul]

like ur videos. one suggestion. please make a video on how much one can gift friends or relative during marraige etc based on income

[@sandip8600]

I ended up buying a new car which violate this rule. What to do now?

[@YashasTuruvekere]

My annual income is 6 Lakh and bought nano second hand for 60k means i made a good deal as per your calculations

[@karthikl1982]

Super advice 👍 but I bet less than 1% of people in India can follow this.

[@PrasadSignor]

With Covid, cars have become a need

[@SUBRAMONEYPV]

yes of course! I am a shareholder of Maruti and Tata Motors, I love the fact that car sales are up!

[@ashutoshpatil1249]

@@SUBRAMONEYPV hahaha.... sarcastic

[@lk4705]

I have been using my car frm last 14 yrs now....1 yr more to go n i have to sell it not becz I want but in Delhi NCR 15 yrs is the deadline for Petrol vehicle usage....otherwise I cn easily run this fr atleast 5 yrs or may be more....Car is a depreciating asset and it depends who u r...but I don't knw whether this 10% formula will fit in fr everyone....with this one can only afford to hav a new car that too Alto 800 if the family income is atleast 35-40 lakhs only....difficult fr most people but not impossible....tough choice though

[@pinkynandi8894]

Who got 2.5cr CTC in job Which job sir

[@chetandeshmukh9103]

Nice opinion

[@VishnuAnilkumar1]

I would have prefered if Subramoney had given a strategy to save and buy than base it on yearly income.I dont want to take any loan for a car and my current financial portflio includes EPF, gold, cash and equity which is close to 20L. in which I have close to 12L in my equity and about 3L in cash (currently set as emergency fund, but plan to maintain it liquid at 20% to 30% of the financial portfolio in cash) . I already own a car, which my parents gifted me, so there is no emergency. They used the car for 10+yrs and I plan to use it for another 5 yrs or so. Since I invest/save close to 50K per month, I expect my future portfolio worth to be atleast 20L+30L = 50L (if not more) in 5 yrs. Do you have a strategy based on the size of financial portfoliio than on yearly income? I was planning 10% of the finanical portfolio is good. Do you think it is too high or a bad strategy?

[@Drdibs11]

Grt video dada

[@SkiNett]

@1:10 ---> a whole generation earlier, life was a lot more simpler and people didn't make youtube videos then !

[@craigslist1323]

Hmm.. he was coming in tv quite a while ago

[@amitshukla4794]

very very convervative approach 10 lakh a car if u earn 1 crore in india who earns 1 crore not more than 1L people...a decent car comes for about 7-8 L on road...

[@juvinantony5929]

10%? Sounds good. But not practical. You will end up buying a cheap unsafe car. What's the point in saving money and losing life in a cheap unsafe car?

[@SUBRAMONEYPV]

if people bought ONLY safe cars, Hyundai and Maruti sales will be zero. See what people do, what I say does not matter at all. Very few people listen to me. They may read yes, but follow? Pipe dream!!

[@akashprajapati4868]

Tons of knowledge for free🙏😀

[@soumyadeepchakrabarty7824]

Anyone having a portfolio of 1 crore can buy a new car of 5 lacs easily now a days. It's the 5% rule of spending.

[@vikramnatarajan2857]

Sir maybe you can reframe it at 10 pc of net worth 😀

[@ThePratapunique]

Hi sir, one doubt, how to stop your videos coming in recommendations?

[@SUBRAMONEYPV]

What do you mean?

[@karthikramki]

Sir..sounds like a very strict rule. If we follow this rule, nobody can buy a decent car in India.

[@durgeshwakle3461]

and in my society people are buying cars without any rule

[@gauravjain24]

Safety in car should be priority not the price. In this way most people should drive in alto, atleast buy a good safe car like tata which stars at 7lk.

[@alokmaheshwari9878]

Car must be used for atleast 10 years preferably 15 if ur not living in place which is near to sea.

[@renjithravi4882]

I have lossed job recently (3 months ago).I was planning to buy a car 2 years before and is looking for it even now.But now my income has stopped.But I have invested 53 lakhs in direct equity,now it has grown to 73.5 lakh.My annual expense is about 6 lakhs.So i need 30 times that for retirement,about 1.8 crore.I have 9 lakh in fd's.What should i do now?Can I purchase a car now?.I have land worth about 50 lakhs other than living house and land.Can you give a suitable advice?.Currenly my expenses are taken from fd's money.

[@PavanMehta]

if my house emi is around 12% of my gross or 15,16% of my net monthly salary can I get a car 20%, 25% of my annual salary? cos 10% of my annual salary doesn't buy me a car at all.

[@shreykumbhare]

What if you are going for electric car

[@bsrabhishek8394]

Your Videos are very helpful sir. I am watching all of your videos, Thank you

[@Adiol]

Actually price of the car shouldn't matter as long as you can keep your emi's under 40% of your monthly income or the price of the car should be your 3 months gross income. those are better benchmarks than the 10% rule which is actually lowering your lifestyle.

[@pinkynandi8894]

I like this is good I earn 1.3cr with no other emi I drive audi a5

[@pinkynandi8894]

My monthly expenses are 1.2l/month I am completely satisfied I do bussiness hence I don't need to pay income tax

[@adityatripathy8868]

Sir your advice will significantly hurt gst collections. 🥁🎻🎷

[@akotireddy]

Though I agree with some basic financial disciplines, I would not agree with 10% for car. I am sure lifestyle is changed from 1980's to 2020. When we buy car we need to see atleast some safety features and with family of 4 we cannot afford to go on bike or cab always, hence minimum budget for car can be 3-5 lakhs as long as the EMI is comfortable and use it for 10-12 yrs.

[@bhavesh4321]

Sir have not purchased car in recent times :-)

[@ashishyadav3609]

People earning 30 lacs buy car for a minimum of 15lacs and probably on loan too. I think more than 99% of people will fail on this criteria!!

[@SANDEEPSINGH-mu5gq]

I bought my first BMW ,costing me roughly 40 l in 2020 . I made roughly 750000 usd which is over 5 cr . So I followed d rule , however my father honked me its too expensive 🙃🙃

[@manojputhran4477]

impossible to follow special in the times of social media ,60-80 of cars bought are lying in the parking space, i suggest buy used toyota or honda - 1.5-4 lac , safety plus easy on pocket

[@anandhasrivi]

Sir do you think 50L earning person will buy 5 L compact hatchback.

[@SUBRAMONEYPV]

this is only for those who want financial independence. Those who want to work till much later have more choice

[@pinkynandi8894]

@@SUBRAMONEYPV I earn 1.3cr and have no other emi should I get bmw worth 40lakh

[@ashutoshpatil1249]

@@pinkynandi8894 🤣 parry ninati

[@abvivek]

Medicine seat cost 1.5 cr.. happy I saved some money for my parents..I'm doing final year MD have not paid 1.5 lakh in fees( aggregate mbbs +3years MD) . off course other expenses like books and food are there

[@gopinath_ravi]

Now. I feel bad :)

[@sonaiitm]

I have brought 8 lakhs worth car, OMG now I will have to earn 80 Lakhs Rs annually 😅🙄

[@sandeepmortal]

I got my answer in the first 30 secs. As per the 10 percent rule, I should buy a scooter.

[@sandeepmortal]

@@Unknown-do3hz ab to cycle motorcycle sab bandh. Lockdown me sirf ghar ke andar

[@sandeepmortal]

@@Unknown-do3hz haa yaar. Yehi ummed hai ki ye aafat jaldi khatam ho

[@rakeshsarvabhotla4998]

@@Unknown-do3hz Go for electric

[@nayak_official6318]

I want to sell my second hand Scotty. U can contact

[@alokmaheshwari9878]

10 percent of CTC is quite inadequate with 30 lakhs salary u cannot purchase even Maruti Alto new. I am myself conservative in this aspect .once with one of friend calculated running cost of car was 8to 10 rs for santro/Alto . Midsize sedan ciaz/ city costed 41/15 rs km . By these calculations no one can purchase car . One thing one can do is to save money for car for 4/5 years then purchase instead of emi . .I myself purchased maruti alto in 2005 with minimal loan for IT Purpose & 2014 honda city without loan.... There must be broad outlines but every person has different likes & circumstances so one must follow his heart & gut feeling also afterall you r born to live not only to retire....your guidelines for flat / house is more appropriate but for car is not prudent enough as general . because owning a car is all lower,& medium class dream .

[@maxmacful]

What about marriage and children, is it for everybody ??? ....

[@SkiNett]

Depends on how much u earn, only marry if u earn over 50 lakhs an year and have kids if u earn 1 crore or more every year. So only 0.1% or less in India can afford a marriage and 0.05% or less can afford a child 🤣🤣🤣 ! I'm thankful that rural India doesn't watch his videos else they will have a heartattack every 40 minutes 😁..

[@woodfire686]

😂😂

[@shobhakaore3962]

@@SkiNett ROFL 😂😂😂😂😂

[@soumyadeepchakrabarty7824]

Sometimes I think, you don't know what you are saying. In India family income greater than 10 lacs are rich.

[@rkpulichikkat]

I don't think this advice is applicable to someone from a village! Ola and uber don't ply there... Anyway, it's always better to live within means!

[@shans281]

What you are saying is true. However a 3 lacs car or for that matter 10 -11 lacs car has an extremely low safety standards in India. From a margin of safety perspective I cannot afford to make such a mistake. Therefore one should always purchase a safe car which comes at premium.

[@chandreshmittal123]

With this rule 99.9999 percent of india could never buy a car..😂

[@SUBRAMONEYPV]

what %age of India has a private car?

[@pinkynandi8894]

@@SUBRAMONEYPV 15%

[@amoghharsha]

@subramoney P V Subramanian he meant if 99% of private car owners in India followed your principle

[@pinkynandi8894]

@@amoghharsha actually 40%of your net family income is the best rule But his friend with 2.5cr CTC must be getting around 70-80l in hand salary so he can't afford mercedes

[@patriciahubbleramei1162]

You don't know how bad Maruti cars. They are zero safety car killing lakhs of middle class. 3 lakh can buy a shitty car..... This advice is outdated.

[@pratikm29]

10% How stupid is that

[@aks1777]

R u crazy or something ? Go check urself