Can You Save Money By Owning A Car? - Costs Of Car Sharing Versus Car Ownership

Published by on . Updated on 20 May 2022
Editors%2 Fimages%2 F1647840725817 Da FeaturedIn what use case does a car actually make financial sense? If you are desk-bound or work primarily from home, owning your own set of wheels probably isn’t the best exercise in fiscal prudence.

With our extensive public transit network, it actually isn’t unrealistic to rely on our buses and trains to get around. But there are situations in which access to a car would very much be preferred. And if you live in a constant state of social anxiety, you’d probably not want to entertain the thought of flagging a cab or utilising a car-sharing service.

So, What Gives?

Actually, it’s all a matter of principles. Having reliable access to a private vehicle may mean you incur more costs monthly, but if you are a successful business owner with a packed schedule, perhaps you’d prioritise the time savings over some scant savings in expenditure.Editors%2 Fimages%2 F1647840816569 1647840816569But there are ways to reduce the cost of owning a car in Singapore to make purchasing and maintaining a vehicle more financially justifiable. Changing your routine is a good way to start, though you should also consider looking at optimising your overall running costs as well - a good place to start is to re-evaluate your insurance policy.

Let’s do some number crunching. Do let us preface this by mentioning that your mileage will quite literally vary, as the stats featured in this article are based on data obtained from the government.

Car Sharing in Singapore

The average commuter in Singapore travels 10 kilometres to and from work daily. For the purposes of this article, we’d assume that the bulk of these people work in the CBD, or in the built-up city areas around it.

Editors%2 Fimages%2 F1647842307893 InsuranceMost car-sharing operators do not provide services that are suited for commuting purposes. You’ll need to return the car to where you picked it up from, meaning that if you actually rented a car in the morning to drive to work, you’ll be paying for the parking at your office building by the hour, but also the rental duration from when you first clock in to when you knock off.

Point A-to-B services are available, with the operator wanting $0.36 per minute of travel. Assuming you’d travel a similar distance on each weekday, with some additional journeys on the weekends to visit friends/family and/or to run errands, you’ll be looking at a realistic monthly total of about $400.

New Car Ownership in Singapore

Let’s say you’re after a bargain basement commuter car, really only good for practical and economical daily commutes and not much else. How much would a basic car like this, set you back annually?

Considering that these vehicles typically retail for (at current COE prices!) slightly south of $100,000, the math would work out as follows:


Across its 10 year COE validity, you’d be looking at an annual depreciation figure of about $10,000. Again, this figure is an average, as cars do depreciate at a different rate at different points in time, with a steeper initial curve for the first three years of ownership, which then plateaus over time.

Petrol CostsEditors%2 Fimages%2 F1647842494292 1647842494292

Assuming a realistic annual mileage of 13,000km, you’ll be looking at around $1,600 (95 Octane, 21km/l fuel economy) in annual petrol costs after credit card discounts.

Road Tax

Editors%2 Fimages%2 F1646877442460 FuelcloseFor the type of economy-oriented car highlighted in this article, the smaller capacity motor would translate to a road tax figure of about $600.

Other MISC CostsEditors%2 Fimages%2 F1647842645254 Carcheck

Parking, ERP, Maintenance and other miscellaneous costs should set you back another $4,000 annually. Excluding insurance, your total annual car expenditure should total up a realistic estimate of $16,200.

InsuranceEditors%2 Fimages%2 F1647842674593 I Stock 688359054+%281%29

Insurance premiums will vary greatly depending on your age, driving experience and accident history - the ideal driver will probably be quoted around $1,500 to insure a similarly-equipped economy car. 

Though it probably isn’t unwise to seek a second opinion from another reputable insurance company, like DirectAsia for instance, to see if you can obtain a more competitive quote!

Total Monthly Expenditure

All in, you’re looking at a monthly total of around $1,475.

And That’s Quite The Gulf

It is. In fact, you can make almost four months worth of commutes utilising a shared car service versus owning a car. Opting to buy used instead of new can reduce your monthly financial inlay, with a total expected monthly total of around $1,000, mostly as a result of the reduction in depreciation.Editors%2 Fimages%2 F1647842604832 CommoncarsSo how can you work at further reducing the cost of car ownership? We actually have a guide for that here. The path of least resistance is to provide car pooling services as you go about your commutes. Doing this will recoup around a conservative $400 in costs monthly.

You can also sign up to do freelance courier services, though do be warned that a portion of what you’d end up making will go towards the increased fuel and maintenance requirements of your vehicle.

A More Palatable Difference

Buying a COE car and offering car pooling services will mean a realistic monthly running cost of about $600, or just a smidge over utilising a shared car service. With reliable access to a car (it’s your own car after all!), and better overall hygiene (only you will come into contact with the common touch points on the driver’s side), it does seem like in the long-term, you’d be better off buying your own COE economy car.Editors%2 Fimages%2 F1647842579589 ShedrivesAnd if you’d really not want to fork out the additional cash, perhaps getting a quote from a reputable insurer with competitive rates can further sway you on your journey towards car ownership. That’s why you should consider switching to an insurance provider, such as DirectAsia, that offers the best car insurance rates!

Do refer to this link to keep up to date with DirectAsia's latest promotions!

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