When I got in to my first job, my dream was to buy my own two-wheeler. I was excited that I was earning money for the first time and thought buying a two-wheeler will be quit simple. I realized it was not exactly easy. Deciding which motor-cycle to buy and then to arrange money for its purchase was quite a challenge. In this article, I hope to explain various ideas that you can use when buying a two-wheeler.
Save more – Short-term pain for long-term gain
How about making a short-term sacrifice to reach your goal earlier?
Let us say you are able to save Rs 2000 per month now.
How about saving another Rs 2000 per month by making some changes. If you can do so, then you can reach your goal in half the time. Sounds impossible! Not exactly. When you save another 2000/-, you are living as if you earn 2000/- less. What happens to other people who earn 2000/- less than you. Are they not alive, are they not living a decent life. It all comes to how badly you want that fancy dream bike that you have your eyes on.
Some of the ideas to save more money
1. Cook more at home rather than eating out
2. Skip that movie that you wanted to watch in a multiplex – Watch it on DVD later.
3. Skip a visit to your home-town
Pay tax – Defer tax planning
Do not save tax is the most uncommon advice you would hear!
But it makes sense.
When you pay tax, you release the amount you had to invest to save tax, which can be in thousands.
Use this money to meet your goal. Easy Peasy!
Run away from all the agents – Insurance, Mutual fund and others
Have you a bought an amazing insurance policy recently. If not, you will soon be approached by someone who has one. First time earners are prime targets for all those who want to sell schemes and get eye-watering commission. It makes perfect sense for them. You do not know much now. Before you learn how they operate, they would have conned you!
Even if it is the most awesome investment scheme, is it more awesome than having your shiny new two-wheeler a few months early? If the answer is no, stay away from any investment – awesome or otherwise.
Borrow money from your family, if they have some spare money
Sounds ridiculous! What will your family think? All these years, they supported you financially and now you are back again asking for more! But there is method to this madness.
Explain them why you want to buy the two-wheeler. If it makes your life easy, saves time and energy during commute, allows you to focus on your work and progress quickly in your career, your family will support you. To be fair to them, you should promise to pay back the money as soon as possible and if possible with good interest. Instead to paying more than 10 percent to a bank or two-wheeler loan company, pay your family and make them rich. Makes perfect sense, doesn’t it.
Borrow from your company
Find out if your company provides short-term loans. Most companies do and charge nominal interest rate. But since you work there, they know you and they will not ask your for all the documentation. They can then deduct the borrowed money and the interest from your monthly salary. Both the borrowing and repaying is a simple process for you.
Borrow from a bank – Personal loan
Personal loans can be expensive – Most charge more than 12-13% interest rate. But if you have a bank account, they know you and you can possibly get a loan easily. But make sure you find out the terms of repayment and any fees, if you repay earlier.
Borrow from a two-wheeler loan company – Make sure you shop around and bargain hard
You can find all the information about borrowing from a two-wheeler loan company easily. Most two-wheeler dealers have a tie-up with some finance company and they will tell you how great their plan is. Do not fall for the smooth talking. They are not your friends. They want to make the most of the opportunity. Visit at least a few dealers and find out what each one is offering. All the companies, including dealers and finance companies have targets to meet and they will give you better terms if you are not desperate. If not the interest rate, they will throw in some goodies, like free insurance for example.
Hopefully you have learnt a few methods to gain enough money to buy your dream two wheeler. Good luck with your purchase.