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Friday, December 9, 2022


“Is it more economical to buy a car or spend on Grab rides everyday? I know owning a car is prestigious and all but the COE price is a real bummer”


Little costs add up

Let’s imagine you buy a car that costs 100k with 70k of COE, then it would cost you 46 sgd every day over the ten years without considering fuel, parking, car insurance, car maintenance, road tax meaning that you will reach easily 60 sgd per day. And this cost will be almost incompressible while you may not use grab every day or chose sometimes to take a mrt. A car is therefore not a cheapest option unless you have specific conditions such as a family.

Depends on how many Grab rides a day

It depends on how many Grab rides you take. If you take 4 Grab rides a day (1 to drop kids off at school, 1 to work, 1 to pick kids up, and 1 to home), 20 times a month, owning a second hand car makes more financial sense. This is because Grab rides at peak traffic times are quite pricey. I don’t even take Grab anymore because taxi is cheaper even with the booking fee.

Nothing to do with prestige at all. It is all about time and logistics if you have a family.

Looking at monthly travel expenses

For starters, if you think that buying a car is about prestige then you definitely don’t need to buy a car to take yourself from point A to point B.


Using Grab or taxi makes sense for mostly the following situations:

  • Single or young couple
  • Small family with 1 kid
  • Living close to the city or really good locations

The last one is quite an interesting one because you pay more when you live near the city however you do save a lots of money and time in many ways. An European family I know have two daughters, both born here and they’re still happily living without a car because of their home location.

You need to look at your average monthly travel expense and if it is anywhere around S$850+ then you may look into a 2nd hand car (with 6-7 years COE left)

After doing some research I see no sense in owning a brand new car because first of all, COE now is crazy high and secondly – the moment you own a brand new car, its price in 2nd hand market depreciates by 12%-20%.

In short, please check your present expenses and see if it’s suitable for you to buy a car.


Some rich people don’t drive

Wait, owning a car is prestigious??

I know people who make mid-six figure salary a year who don’t drive. I know very senior professionals who, on principle, don’t drive because it’s bad for the environment – they take the train into work.

A car is a means of getting round. In SG, it might make sense in specific instances (e.g. you have to drive to and from different remote locations every day for your job). That’s it.

New or second hand car

It honestly depends on how much grab you take and how much you drive. And did you buy new or second hand? And what car did you buy?

My car costs approx 1450 a month, not including petrol. This includes depreciation, road tax, parking, insurance, and maintenance. Of course, if your NCD is high it can be lower, say 1350.

If I grab everyday 2 times on average, and maybe 3 times on the weekend, that’s 16 grab rides a week, or 64 rides a month. Let’s call it 60 for convenience.

Assuming you would have to drive that same distance, you would probably pump petrol 3-4 times a month (let’s call it 3.5 times) at around 80-100 a tank (depends on size etc.) I drive a diesel and quite a fuel efficient car, so your experience may vary.

Nowadays grab costs about 30 or more unless you are going v short dist. A grab from my home to workplace costs between 27-50 depending on the time I take it. At peak times it can hit 50 easily. Let’s call the average ride is 30 as an estimate.

So 60*30= 1800

For my situation, its close- 1450 plus petrol costs of $400 would be around the same 1800.


With cheaper hybrid and electric vehicles the equation might actually tilt more towards cars.

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