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Meet Viya and Why Owning a Car Is (Not) An Expense

Viya is lodged as an asset and a liability in my personal SALN. The asset side, which is the car value, I depreciate regularly (I read somewhere that normally, cars depreciate 20% in price by year 1, 10% for years 2 to 6 and 5% for years 7 to 10. Which leaves you 10% salvage value by year 10).

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Her name is Viya. And yes, she’s a beautiful and striking all-new Vios.

Pardon me for sharing this with you. Anyway you can always skip this article if you don’t find it worth your time.

As in the Gospel and other good news, some things really just bring us joy and gratitude that we want to share it, not to the point of bragging about it, but only to the point of saying, “come, celebrate with me and share in my joy.”

Got her last February (still waiting for the new license plates actually) and it’s just now that I’m writing about her (I’m shy and low profile you know). With the help of a generous company benefit, a car loan, and some more passive income, was finally able to tick off one more item in my list of goals before turning 30.

The Wait
The latest Vios model was released last July 2013 and as soon as I laid eyes on the computer-generated design, I fell in love (sorry, ang babaw ko). I know I know, the Vios is not the king of cars, not the most affordable or exciting in its segment, but for me, it’s really just a match of what I want, my personality and what I can afford as my first.

It was also a bit agonizing to wait for 9 more months before finally getting one. I had to learn how to drive first, secure a license and save up for the down payment I’ll have to shoulder. And free up some more of my monthly cash flow. So just imagine how it felt as I see more and more of the new Vios out in the streets while I line up rain or shine in MRT or in shuttle on my way to and from work. No offense to my fellow commuters, I still commute regularly (to save gas and during number coding day) but really, having a vehicle of your own is more convenient and relaxing, even in spite of the traffic. Especially if you commute for extended periods of time and multiple transfers.

The Decision
In 2012, I had to choose between a car or a condo. I decided to pursue a humble condo first, thinking that it would be an investment and provide me convenience and/or passive income down the road. God-willing, I’m 18 months or so into the down payment of the said unit. 2016 will be the turn-over. However, 10 months into the down payment of the unit, I also started to consider that I need to maximize the opportunities available to me (e.g. company benefit) and the time that passes by that I have not availed of it (e.g. the longer I delay availing of it, the latter I wall be able to pay it off). And so, I started the search, and with great timing, Toyota released the new look of the Vios.

Which Unit
I wanted a subcompact sedan that fits my budget and very fuel efficient given the travel distance I need to cover every day. I considered other units as well such as Hyundai Accent, Mitsubishi Mirage G4, Honda City and other cars in bank’s repossessed lists. I finally went for the brand new all-new Vios because of the brand, the looks, and since it is newly released. I’m also not affected of the taxi stigma that usually comes with it. I also went for manual transmission (M/T) instead of automatic (A/T) just because I really want to experience the old school way of driving. Lots of challenges so far in driving M/T but no regrets. I can always jump to A/T for my next car which is allowed in my Driver’s License but shifting from A/T to M/T is more difficult if one only knows how to drive A/T.

Expense
Of course one has to pay a premium for convenience, especially in this country. I’m happy to share though that so far, my monthly gas and parking expense is just PHP1.5k more compared to if I commute the whole month. So the extra costs really are the car amortization, insurance (annually) and the maintenance (which will increase as the car gets old). But for a brand new one, maintenance cost should not be an issue.

Viya is lodged as an asset and a liability in my personal SALN. The asset side, which is the car value, I depreciate regularly (I read somewhere that normally, cars depreciate 20% in price by year 1, 10% for years 2 to 6 and 5% for years 7 to 10. Which leaves you 10% salvage value by year 10). The liability side is reduced regularly as well as and when I pay off portion of my car loan. In effect, it still gives me a positive contribution to my net worth. Especially after year 1 of steep depreciation.

But more than the balance sheet effect of it is how you will make this piece of metal value-adding to you. Not just in terms of convenience but financially as well.Β A car can be an investment, an aid to your income stream. An option is to use it for public transport, carpooling etc. Or use it for business trips, deliveries, etc. Or just the act of sharing it with family and friends so they can save time and money is another value-adding strategy. Having a car is indeed costly, but it need not stop as mere cash out. It can do a lot of things, and can be made very much beneficial, both tangible and intangible.

Start the fun, start the funds! Below is actual photo of Viya. Thank you for reading up to this point.

Viya_zps0fa23f19.jpg
Photo: From Toyota Website
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About Geri (348 Articles)
Founder and main author. Husband, used-to-be-breadwinner, God-made multi-millionaire, employee, financial planner and adviser, investor, stocks trader, entrepreneur, agri-preneur, book author. Firm believer that all Pinoys deserve a richer life. Not a guru, but a forever student of the investments world, a work-in-progress.

2 Comments on Meet Viya and Why Owning a Car Is (Not) An Expense

  1. Me too so far! Putting some minor enhancements and accessories here and there haha! Though probably my next purchase will be an A/T. Thanks for dropping by!

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  2. I am a happy owner of a Vios 2009.So far i am satisfied with its performance as it is very fuel efficient and durable.Aside from the regular maintenance it hasn't given me a major headache so far.The “pang taxi” image doesn't bother me too.I believe for a car in it's segment and price range, Vios is a wise and practical choice.

    Like

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