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Buy Luxury Car Free

Buy Luxury Car Free Without Spending Your Savings

Posted on 3 December 20243 December 2024 by Saroj Singh
Contents hide
1 How to Buy Luxury Car Free – Let the Stock Market Pay for It
2 Traditional Ways to Buy a Car
3 The Stock Market Route: A Smarter Option
3.1 1. Systematic Investment Plan (SIP): Plan Ahead
3.2 2. Systematic Withdrawal Plan (SWP): Let the Market Pay the EMI
3.3 The Benefits:
4 The Bigger Picture
5 A Smarter Way to Live Your Dreams

How to Buy Luxury Car Free – Let the Stock Market Pay for It

Hi folks! Imagine cruising in a shiny new Mercedes. Tempting, right? Okay, fine, I’ll admit—I didn’t buy one. In fact, I’m not a fan of owning luxury cars. My office is just a kilometer away, and it doesn’t make sense for me. But for those of you dreaming of owning a luxury car like a Mercedes, I’ve got a fascinating strategy for you.

Instead of relying on the traditional ways of buying a car (either taking a loan or paying the full amount upfront), I’ll show you how to let the stock market pay for your car while helping you build wealth. Intrigued? Let’s dive in.


Traditional Ways to Buy a Car

  1. Loan & EMI:
    Most people go this route—taking a loan and repaying it through Equated Monthly Installments (EMIs). For instance, let’s say you’re buying a luxury car worth ₹75 lakhs. At an interest rate of 8% for a 7-year tenure, your EMI will be around ₹1.2 lakhs per month. Over seven years, you’ll end up paying significantly more than the car’s price.
  2. Paying in Full:
    If you’re fortunate enough to have the full ₹75 lakhs, you can buy the car outright without worrying about EMIs or interest. However, your money could’ve been invested elsewhere, earning returns.

The Stock Market Route: A Smarter Option

1. Systematic Investment Plan (SIP): Plan Ahead

If you don’t have the full amount yet, you can start a SIP. Here’s how it works:

  • Target: ₹75 lakhs
  • SIP Amount: ₹50,000 per month
  • Duration: 7 years
  • Expected Returns: 12% CAGR (based on historical market returns)

By the end of 7 years, your SIP will grow to approximately ₹77 lakhs, enough to buy that luxury car upfront.

2. Systematic Withdrawal Plan (SWP): Let the Market Pay the EMI

If you already have ₹75 lakhs, instead of buying the car outright, invest it in the stock market via a mutual fund. Here’s the plan:

  • Invest ₹75 lakhs in an SWP.
  • Withdraw ₹1.2 lakhs monthly (to cover EMI-equivalent payments).
  • Expected Returns: 12% CAGR

After 7 years:

  • You’ll have paid all your EMIs through market returns.
  • You’ll still be left with ₹21 lakhs as residual wealth.

The Benefits:

  1. You own the car without emptying your savings.
  2. You build a habit of investing.
  3. You still have ₹21 lakhs in hand even after 7 years!

The Bigger Picture

The sales of luxury cars like Mercedes have seen fluctuations. Mercedes even blamed systematic investment plans (SIPs) for declining sales, citing a shift in people’s priorities toward saving and investing. However, data shows that the correlation is minimal. Factors like pent-up demand, cascading taxes, and the high cost of luxury vehicles in India are more likely contributors to these trends.

For instance, the 100% import duty and additional GST slabs (28% for sedans and 22% cess for SUVs) make luxury cars significantly more expensive.


A Smarter Way to Live Your Dreams

Owning a luxury car doesn’t mean compromising your financial goals. With smart investment strategies like SIPs and SWPs, you can fulfill your dream while building wealth. Whether it’s a smaller car or a premium luxury model, this approach allows you to balance your aspirations with long-term financial health.

Start today, and let the stock market work for you!

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