Car subscription has become a popular choice in Singapore. This is due to the many advantages that come with car leasing solutions. This includes fixed prices, comprehensive car insurance, routine servicing and many more.
When compared to car ownership, the main difference comes down to one important factor – cost-savings. With all the perks that come with car subscription services, does that really make it more cost-saving in the long run? Let’s take a look to find out more:
Initial Costs
Car Subscription
Car leasing typically has little to no upfront cost. That means no down payments, taxes, registration fees or loan interests. You only pay the fixed price of your car subscription plans.
Car Ownership
On the other hand, purchasing a car involves substantial initial costs. Apart from down payments, you also have to pay for registration fees, insurance premiums and loan interest.
These costs can add up quickly, putting a dent in your bank account.
Depreciation
Car Subscription
One of the most significant expenses of car ownership is depreciation. As soon as you drive a new car off the lot, it starts to lose value.
With car subscription, you don’t have to worry about depreciation since you’re renting the car for a fixed period. This means you can avoid the depreciation hit that comes with long term ownership.
Car Ownership
Depreciation is a major consideration for car owners. New cars can depreciate by 20% or more during the first year! And they’ll continue to lose value over time.
While some cars hold their value better than others, depreciation can still result in a significant loss when it comes to selling or trading. This loss isn’t recouped and can impact the overall cost of ownership.
Maintenance and Repairs
Car Subscription
Car subscription comes with the added benefit of maintenance and repair services. That means wear and tear coverage, routine servicing and even 24/7 roadside assistance.
With all these costs bundled up into the subscription, you can better manage your monthly expenses. Not to mention avoid the financial surprises that come with car ownership.
Car Ownership
Maintenance and repair costs can vary depending on the type of vehicle. While some cars come with warranties, owners are still responsible for general maintenance like oil changes and tire rotations.
Additionally, these costs will only increase as your car gets older!
Fuel Costs
Car Subscription
Most cars need fuel and with KINTO, you’ll get exclusive fuel discounts up to 22%! This can help you battle increasing fuel costs throughout some of the biggest oil majors in Singapore.
Car Ownership
With ownership, you’re forced to pay the market price for fuel. This means that any fluctuations in fuel prices can directly impact your monthly expenses. Not counting long commutes or frequent driving for work and leisure.
Car Subscription is the Smarter Financial Choice
Ultimately, vehicle subscription services are the cheaper option to car ownership. While owning a car gives you freedom and flexibility, the total cost of ownership can be significantly higher. Everything from down payments to depreciation can put serious strain on your finances.
And don’t forget the volatile nature of COE (Certificate of Entitlement) cost. The COE system has made Singapore the most expensive country to own a car and prices continue to rise! By taking these factors into account, it becomes clear that car subscription is the cost-saving option.
These cost-saving benefits can then extend to other areas of business and personal life including:
Budgeting and Financial Planning
With fixed monthly payments for a car subscription, it becomes easier to budget and plan your finances. There are no unexpected costs or fluctuations, allowing for better financial management.
You can invest your money in non-depreciating assets like stocks and bonds or even your business.
Professional Image
For self-employed professionals and businesses, maintaining a professional image is crucial. Having access to a well-maintained, newer vehicle can enhance the company’s image and instill confidence in clients.
Tax Benefits
In Singapore, car subscription fees can often be considered as operating expenses and are tax-deductible for businesses.
This presents an opportunity for self-employed individuals and businesses to reduce their taxable income and overall tax liability.
Access to New Models
With car subscription, you can enjoy driving the latest models with advanced features and technology. This allows you to experience different cars and stay up-to-date with automotive advancements.
You can even scale your vehicle to accommodate a growing family or business.
Environmental Considerations
Car subscription services can reduce environmental impact by lowering car production and ownership needs, which decreases resource extraction and manufacturing emissions. Additionally, subscriptions can reduce traffic congestion and free up urban space, contributing to more green areas and lower emissions.
Not to mention the potential savings on fuel costs and tax incentives.
Conclusion
A car subscription in Singapore is a great alternative to owning a car. It comes with tons of perks and benefits but most importantly, it can save you money in the long run.
All in all, leasing is a smarter financial choice for busy professionals, a growing family or a company looking for fleets. So make the switch today and get in touch to find out more!
