Jumat, 01 Juli 2011

Cost of owning a car


Many Singaporeans start to own a car at the age of 27 or 28. They might think that they could well afford the car since the monthly installment is probably a small fraction of their pay (20%?). I will now try to break down the costs of owning a car:

Monthly car instalment : $700
Car insurance : $100
Petrol : $300
Cash card : $100
Season parking : $100
Total: $1,300

In contrast, the monthly cost of taking public transport is probably just $100

This means that one will be spending $1,200 more than a person who takes public transport. If the person who takes public transport were to invest that $1,200 every month at a rate of just 5% for 10 years, he would have accumulated $186,338. Given a dividend of 5%, his additional monthly passive income at the end of 10 years would be $776.

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