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Do you dream of buying a car, and enjoying the status and opportunity that comes with it? Take a minute to ask yourself some important questions and set a realistic budget before embarking on the journey of buying your dream ride.

Owning a car gives you a sense of freedom and independence, but it also comes with a great deal of responsibility. There are many expenses to consider in addition to a monthly car repayment, such as the cost of fuel, insurance and an annual vehicle licence fee. Another expense is the cost of car maintenance – no matter the make, model or age, it must be serviced regularly. Most vehicles should be serviced every 10 000 km - 15 000 km driven, and spare parts, especially for luxury vehicles, can be expensive. You will also need to replace the tyres when they are worn, which includes additional costs like wheel balancing and alignment.

Try to think long-term rather than short-term about what you need and budget. Remember, the longer it takes to pay something off, the more interest you’ll pay back. Only start looking for a vehicle that suits your lifestyle and pocket once you’ve established your goal and how much you can afford to pay back every month.

Ask yourself these questions before you start shopping around:


Why do you want to buy a car? 

  • To get to work 
  • It’s more convenient than public transport 
  • My family is growing 
  • To impress my friends and/or family

Tip: You should only buy a car if it will really add value to your life, like helping to advance your career. Keep in mind that the minute you buy a car, it starts to lose value. 


Have you saved any money? 

  • Yes 
  • No

Tip: It makes good financial sense to save up for a cash deposit, as paying a lump sum upfront will reduce the monthly repayment amount and the total amount you pay back over the long term. Use one of the 4 free savings plans you get with your Global One facility to save towards a car deposit – you could earn from 4.75% interest.


Have you set a budget based on what you can afford? 

  • Yes 
  • No

Tip: A good rule of thumb is that the price of the car should not be more than 30% of your annual gross salary, while your monthly car costs should not be more than 10% of your monthly salary. This will help ensure that you can still meet all your other monthly and day-to-day expenses, such as buying food and paying rent. Use these budget guidelines to calculate what you can realistically afford, and use our budgeting tool to decide how to split your budget.


Will you need credit or a loan to pay for your car?

  • Yes 
  • No

Tip: If yes, consider a personal loan. You could qualify for up to R250 000 over 1 – 84 months from 12.9% interest, based on your credit profile and need. Check out the different credit options here.

In Phase 2, we’ll address your purchase and payment options, and give you tips on how to make your budget work for you over the long term.


Action your big goals 

Setting realistic annual goals is a great way to help build the life and career you want. The more practical and informed your approach, the more likely you are to achieve your dreams. We’d like to help you reach at least one goal this year, so we’ve created a 3-part series of handy checklists for 4 major financial goals. Whether you want to save for your education, a dream holiday or buy a car or home, we’ve got you covered.

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