Is it cheaper to own a car or give it up ?

One of the biggest questions faced by car owners is whether or not you should own your own vehicle. No wonder, driving your vehicle has its own perks and advantages. However, with rising fuel prices, it is becoming difficult for a common man to drive their vehicles to work on daily basis. Also, automobile manufacturing industry is coming up with new and creative technologies that burn less fuel and banks offering car loan facility to make it easier for people to buy a vehicle, yet many families are getting sceptical about vehicle ownership.

In a recent survey conducted to understand the benefits and disadvantages of owning a vehicle, it was revealed that many people prefer to call a cab or share ride or even carpool as their mode of transportation. In fact, the study showed that potentially one-quarter of the population would be at much better financial state by using riding services versus owning their own vehicle.

So, whether or not you should own a vehicle is still a question that needs to be answered. Here are few things you should consider before putting your money in purchasing a car or before taking a car loan.

Analyse full cost of ownership

You need to be very calculative when you are trying to analyze the costs associated with buying a car. You would need to allocate a specific budget every month just for commuting purposes in order to do all the calculation and be realistic about it.

When you walk into a car showroom, most of the sales people brag about the mileage of the vehicle, the first point of consideration has always been car mileage. However, you should never take their words seriously. If you are planning to own a vehicle, make sure you understand the concept of fuel average and how it can affect your current financial situation. One easy way to deal with this could be to apply for a credit card that has partnered with petrol pumps. These cards come with varied advantages like rewards or zero surcharges.

Don’t forget to add in the maintenance costs that come with vehicle ownership. To be able to use the car efficiently and effectively, it requires regular maintenance. The more you delay the bigger wear and tear costs you would have to bear and god forbid, if you meet with an accident, you would have to pay for car repairs as well as put up with additional medical costs.

Traffic jams and parking space is another point of consideration. Traffic jams are an evident part of day to day driving, especially during peak hours. Longer traffic jams means utilizing more fuel and time consumption. Also, parking your vehicle is another concern in cities. Even though, most of the high reputed companies have their own parking area. However, when you have thousands of employees working in your company and fleet of employee cabs, it often gets difficult to find a parking spot in the building. This means that you would have to settle with outside parking that is usually chargeable. So, you might want to consider parking costs as well.

Finally, let’s not forget the EMI’s that you would have to pay every month if you avail a car loan. That is an additional expense that you would have to tolerate along with all the other expenses.

If your calculated costs come within your allocated budget, then planning your own vehicle can be a good option for you. However, if it is surpassing the budget, then you might want to think about dropping the idea for a little while.

Ubering vs Owning

Now let’s shift our focus to other prefer modes of transport. Many people in rely heavily on cab services for their daily commuting. Kudos to smartphone evolution, cab services like Ola and Uber have become quite popular amongst the travellers.

These services are popular because it is available round the clock and a potential rider can book a taxi or even an auto within a moment. Although, these apps are often blamed for price surges, however, frequent commuters can also take advantage of various offers and schemes that can be highly beneficial in terms of costs.

When you are taking a cab service, all you need to worry about is the commuting time. There are no additional costs like regular wear and tear, insurance costs and no driving stress that usually comes with congested traffic. Other than this, the cab rider doesn’t have to worry about parking space, monthly EMI’s, traffic penalties etc. All you need to do is just book a cab from your phone and hop into it.

People who commute in cabs are less tired than the ones driving. Also, the amount of savings you accumulate every month, you can invest in risk-free investments like RD’s or Fixed deposits. So, you are not just saving, you are earning as well in the shape of interests.

Which is better?

It completely depends on person to person. People who have long working hours, especially women, have to think about safety with cab services. Owning your own vehicle provides more flexibility. Also, if the cab services go on a strike, which is quite possible looking at the instances happened in the past, you would have to either take an off that day or make other arrangements, which can be cumbersome. However, with infrastructure, more fuel expenses, monthly EMI’s and high pollution, it makes more sense to rely on cab services. So, analyse all the pros and cons properly before you make a decision.

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