The last time I got on board an MRT train, it was packed tighter than a can of sardines. I squeezed in nonetheless as I was rushing to the hospital. By the time I got there, my cousin had already come out of surgery, and was arguing the merits of bike riding at midnight. In the time I took to get there – a man was cut open, had his insides rearranged, got stitched back up, overcame anaesthesia, and recovered enough to indulge in an argument.
Suddenly, cars started to feel like a necessity.
Sure, it costs more, but the question is how much more. If you’re in a line of work that requires fast travel, such as sales or journalism, it might be worth it (No, being a full-time Need For Speed gamer doesn’t qualify). To settle the issue, Moneysmart did some accounting and figured the exact cost of driving to work.
The REAL Cost of Owning a Car
Some Assumptions:
– The car we’ll get is a Toyota Corolla Altis, 1.6 Classic (A). It’ll also be white, have a Doraemon bobble-head, and a tissue box in the back. Total chick magnet, I know.
– The car will be used 22 days in every month, to get to work. It will cover 30 km each day.
– We’ll drive the car for the duration of the COE (10 years).
– We’ll assume a constant average in fuel prices, ERP, and the related costs.
– We’ll take out a loan to purchase the car.
– We’re not factoring inflation into the equation.
Price of the car:
The car itself costs $91,500. On top of that, there’s the custom duty, GST, ARF, OMV, and the king of all acronyms, COE. After paying for all these, we also need to pay a premium to the dealer, which is 16 percent over the basic cost.
Final Cost = $105,988.
Well, that’s expensive. Good thing we’re done oh…wait. The bank loan. Let’s look at that:
Monthly installments, including interest payments at 1.88 percent, comes to $944 a month. Over 10 years, we’ll pay $113,280. The initial down payment for the car is a further 10 percent, or $10,598.80. So the final cost is $123,878.80.
Next, the variables:Road Tax – At $742 a year, that works out to $7,420 over 10 years.
Car Insurance – Let’s assume we’re going to pay $20,000 over 10 years, which is a fairly conservative premium average of $2,000 a year – so drive safe because one claim will send your premiums skyrocketing!
Maintenance – Vehicles in Singapore need to be certified roadworthy. Also, things break. We’ll assume you visit the mechanic once every six months, paying him about $10,000 in all.
Parking – Did you know that if you pay $10,800, you can park in an HDB lot for 10 years? Let’s do that. But the cost of office parking, even for season ticket holders, comes to about $18,000 in 10 years. Altogether, you pay $28,800 over 10 years, just to have the car sit there.
ERP – Electronic Road Pricing deducts automatically from your cash card when you drive into the CBD at peak hours. Let’s say you go in at peak hour (to get to work), so you pay $8 a day, 22 days a month. Over 10 years, that’s $21,200.
Fuel – It’s 30 km to and from the office, and we’ll travel that 22 days a month. The fuel consumption for the Toyota is 14.9 km per liter. That works out to around 44.3 litres of fuel every month. Taking the current Shell 95UL fuel price of $2.140 per liter, that equals $94,802. Over 10 years, that’s $11,376.24. Now you know why they bomb countries for this.
| Expense | Basic Amount (SGD) | Calculation for 10 years | Total Amount (SGD) |
| Down Payment | 10598.8 | 10598.8 | |
| Installment/ month | 944 | 944 x 12 x 10 | 113280 |
| Road Tax/year | 742 | 742 x 10 | 7420 |
| Insurance/year | 2000 | 2000 x 10 | 20000 |
| Car servicing/ 6 months | 500 | 500 x 2 x 10 | 10000 |
| HDB Parking/ month | 90 | 90 x 12 x 10 | 10800 |
| Office Parking/ month | 150 | 150 x 12 x 10 | 18000 |
| ERP/day | 8 | 8 x 22 x 12 x 10 | 21120 |
| Fuel/month | 94.802 | 94.802 x 12 x 10 | 11376.24 |
| Total Cost (10 years) | $222,595 | ||
| Cost Per Month | Approx. $1,854.95 |
The Cost of Public Transport (Buses, MRTs and Taxis)
Savings = $1,791.15 each month, or enough to pay tuition at a private university.
We’re assuming that you take the bus about 30km to and from work. In reality you’ll have to walk a bit , so it’s probably a bit cheaper.
MRT: $3.20 a day, for 22 days a month = $70.40 a month
Savings = $1784.55 each month, or enough to hire seven tuition teachers.
15km is less than the distance from Changi Airport or Jurong to City Hall. That trip costs about $1.60 each way, which works out to $3.20 a day.
Taxi: $40 a day, for 22 days a month = $968 a month
Savings = $886.95 each month, or all the textbooks (brand new) for a first year university student.
A 15km cab ride, even with the ERP, costs you about $22. At $44 a day both ways, that’s $968 a month.
To Summarize…
| Car | Taxi | MRT | Bus | |
| Daily | $84.30 | $44 | $3.20 | $2.90 |
| Monthly | $1855 | $968 | $70.40 | $63.80 |
| Yearly | $22,260 | $11,616 | $844.8 | $765.60 |
Of course, it’s not just about the numbers. If you have disabled family members, or have a job that requires you to move fast, then the car will remain the most viable option. But let the numbers speak. Isn’t there something better you could be spending on?
Research by: Shubhreet Kaur
If you own a car or intend on doing so anytime soon (and your last name isn’t ‘Gates’ or ‘Buffet’) – Please comment below and let us know how you’re making space in your budget for this and what sacrifices you’re making financially?