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Do you really need a Car in Canada?


Do you really need a Car in Canada?

In a country like Canada, where the weather can be very harsh, you need a personal car. Which means the car is a necessity in Canada but considering cost of maintaining a car, it’s a Luxury product! Family needs to be sure if they really need a car or not and i am sure this blog will help you take right decision.

You really need car in case any two of below questions answer is "Yes" for you:

  • Is there a small child in house?
  • Is your work destination is more than 90 minutes by public transit?
  • Do you love travelling?
  • Are you planning to use a car as extra income by driving for Uber/Lyft?
  • Do your job require you to have a personal car?
  • Are you planning to do 2 jobs and need to minimise transportation time?
  • You can afford extra monthly cost of $700-$1000 just on car ?

You don’t need a car if answer for any of below question is No:

  • Can you afford monthly extra cost of $700-$1000 just on car?
  • Is your child’s school and day care nearby to your home and workplace?
  • Daily parking cost at your workplace is less than $10?
I hope by now you made your mind if you going to buy a car or not! 
Next questions to be answered are:
  1. To buy a new car or used one?
  2. To lease or financed?
  3. To Buy Gasoline, Hybrid of an electric car?
  4. To buy Hatchback, Sedan, SUV or Truck?
  5. Which Brand to go for?
  6. Which features are must in my car?
  7. Insurance cost for car?

To buy a new car or used one?

I will go with new one because for me car is for my convenience and to save my time which is more proven fact for new car because you don’t need to worry about emergency maintenances, visiting garage frequently for something and other except regular maintenance like oil change. But it’s my personal preferences and sometimes you might get better used cars also. There is a huge used car market and you can get a good car of your choice from Authorized car dealers or you can find a used car personally from Facebook marketplace or kijiji.ca.

Used car is preferable in case:
  • You have limited budget
  • You don’t want to create extra monthly liability and just want to buy cheaper used car.
  • You are not sure if you going stay in province or country for longer period of time.
  • Found better deal from reliable seller like family or friends.
  • Interest rate % on Finance is lower.
  • You have your auto service person who can check used car for you and provide genuine advise.
  • You want big branded car and also to fit in your budget.

To lease or financed?

For used car normally interest rates are higher around 6% to 7% so you end up paying more on interest while for new cars are normally available @1 % to 2.5 % on finance or leasing sometimes you get 0% finance deals also in new car.

You have to explore a lot as far as deals are concern, do phone calls to authorized dealers, check their websites. But on red flag for you guys and I am sharing this from my real experience. Some of dealers are really not professional at all, what they did with me is without asking me if I am ready to buy a car, they just hit my credit history without my consent. Beware of it and never share personal details until you make up your mind.

All newcomer start their credit score with 650 points and it goes up or down depends on usage of financial products specially credit cards. Car finance is not a big deal, they might scare you like you might not be eligible but believe me if your credit score is above 700, I think you are good to go.

Leasing is good option in case you want change car every three years although you have an option to buy out your car at the end of lease period. Leasing is beneficial for business class people or sales professionals who have more of commission income and they can claim car expenses against income to save on taxes.

To Buy Gasoline, Hybrid of electric car ?

I am still old school and will go with the Gasoline only.

It all depends on personal choice like Performance of car, Speed, Mileage (Saving money on fuel). I just don’t think people who buys Hybrid or fully electric car like Tesla to save Money on Fuel ! Let me Explain with below calculation:

Car Savings Calculation-Type of Car

Electric cars has limitations if you like long drives as they have limited range although tesla has good amount of charging stations in US. One Can prefer Hybrid car of planning to use car as Taxi for Uber/Lyft or private Taxi or monthly run is more than 2500 KM.

To buy Hatchback, Sedan, SUV or Truck ?

My personal Choice is Sedan. Although people prefer SUV in case they travel to terrain or truck in case living in countryside in Canada. Trucks are low maintenance and very good on snow and terrain.

Again depends what you prefer and where you want to compromise or not.

Which Brand to go for ?

This is a Question for which, i might need to write separate page to answer it. Keep looking or you can ask me out personally and will try to reply.

Which features are must in my car ?

  • Heated Front seats.
  • Heated Steering.
  • Reverse Camera.
  • Apple Car Play/Android Car Play.
  • Dash Cam for security.
  • AWD which is important feature driving in winter.

Insurance cost for car ?

Insurance cost for SUVs are little lower side but I really don’t think insurance cost is a big deciding factor to buy a car or not as well as to decide which car to buy! Although insurance cost is very high in Ontario province compared to other provinces so if you are in Ontario and specially a New Driver, don’t get surprised if you end up paying more than monthly car finance instalment.

Insurance cost majorly depends on your past driving record so my advice is drive safe, follow all Traffic rule. Never Drink and drive and never use your Mobile while driving.

Wish you all the best.

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