{"id":18185,"date":"2021-05-04T20:00:00","date_gmt":"2021-05-04T12:00:00","guid":{"rendered":"https:\/\/www.comparehero.my\/blog\/uncategorized\/how-much-to-spend-car-malaysia.html"},"modified":"2026-03-26T16:01:50","modified_gmt":"2026-03-26T08:01:50","slug":"how-much-to-spend-car-malaysia","status":"publish","type":"post","link":"https:\/\/www.comparehero.my\/blog\/wages-employment\/how-much-to-spend-car-malaysia.html","title":{"rendered":"How Much Should You Spend On A Car In Malaysia?"},"content":{"rendered":"\n<p><em>This article was first published on August 8, 2018 and has been edited and updated for accuracy and clarity.<\/em><\/p> \n<!--more--><p>We Malaysians love cars. There is no doubt about that. It often feels like it\u2019s part of our culture to buy a car. Perhaps it\u2019s because of our public transportation system that is lacking slightly in coverage-area (although slowly improving), or that we\u2019ve got really awesome driving roads for driving. Whatever the reason may be, however, car loan repayment in Malaysia is <a href=\"https:\/\/www.thesundaily.my\/local\/are-we-staring-at-a-bankruptcy-storm-MN2690835\" target=\"_blank\" rel=\"noopener noreferrer\">one of the leading reasons that Malaysians are going bankrupt<\/a>.&nbsp;<\/p> \n<p>But there are times that we really need a car, and surely there is a right formula to own one? When buying a car, it all comes down to the cost, and the question that most people want to know is \u201cwhat can I afford?\u201d<\/p> \n<p>[toc]<\/p> \n<p><strong>Related:<\/strong> <a href=\"https:\/\/www.comparehero.my\/transportation\/articles\/what-to-consider-when-buying-car-in-malaysia\" target=\"_blank\" rel=\"noopener noreferrer\">#NewNormal: Top 3 Factors To Consider Before Buying A Car In Malaysia<\/a><\/p> \n<p><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" src=\"https:\/\/i0.wp.com\/144634072.fs1.hubspotusercontent-eu1.net\/hubfs\/144634072\/assets_comparehero\/CI2105ALZ_Article-Mar-28-2022-01-29-08-73-PM.jpg?resize=640%2C256&#038;ssl=1\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" srcset=\"https:\/\/144634072.fs1.hubspotusercontent-eu1.net\/hubfs\/144634072\/assets_comparehero\/CI2105ALZ_Article-Mar-28-2022-01-29-08-73-PM.jpg 1024w,https:\/\/144634072.fs1.hubspotusercontent-eu1.net\/hubfs\/144634072\/assets_comparehero\/CI2105ALZ_Article-300x120-Mar-28-2022-01-29-10-65-PM.jpg 300w,https:\/\/144634072.fs1.hubspotusercontent-eu1.net\/hubfs\/144634072\/assets_comparehero\/CI2105ALZ_Article-768x308-Mar-28-2022-01-29-01-97-PM.jpg 768w\" alt=\"\" width=\"640\" height=\"256\"><\/p> \n<p> <a href=\"https:\/\/www.comparehero.my\/car-insurance\/promotions\" target=\"_blank\" role=\"button\" rel=\"noopener noreferrer\"><br> Click here to purchase or renew your car insurance and get eVouchers worth up to RM200 for FREE!<br> <\/a><\/p> \n<h2>How do you find out if you can afford a car?<\/h2> \n<p>There\u2019s a very simple formulation that can guide you on how much you should spend on a car, and don\u2019t worry, it isn\u2019t going to be a big number. It\u2019s simple maths: The car you can afford to buy is the one with a price that\u2019s equivalent or less than <strong>your monthly gross salary x 12 months<\/strong>.<\/p> \n<p>Let\u2019s use the <a href=\"https:\/\/www.nst.com.my\/news\/nation\/2020\/12\/652686\/survey-reveals-bright-job-prospects-fresh-graduates-2021-2022\" target=\"_blank\" rel=\"noopener noreferrer\">average starting salary<\/a> of a fresh graduate, for example, RM2,500 (in most industries). Their annual gross income would amount to RM30,000. Using the annual gross income as a guide, a viable car to purchase by the fresh grad would be the <a href=\"https:\/\/www.perodua.com.my\/our-models\/axia.html\" target=\"_blank\" rel=\"noopener noreferrer\">Perodua Axia E 1.0 manual<\/a>, priced at RM23,367 (not inclusive of <a href=\"https:\/\/www.comparehero.my\/car-insurance\" target=\"_blank\" rel=\"noopener noreferrer\">car insurance<\/a>), but do keep in mind that this is the <a href=\"https:\/\/newcar.carlist.my\/price-list\" target=\"_blank\" rel=\"noopener noreferrer\">cheapest brand new car available<\/a> in Malaysia right now, and it doesn\u2019t even come with a radio.<\/p> \n<p>If the fresh grad is to put a downpayment of 10% and take a five-year loan with an (estimated) interest rate of 3%, they would be paying roughly RM404 per month (RM303 for a seven-year loan or RM247 for a nine-year loan). (These estimations were made via the car loan monthly instalment calculator on <a href=\"https:\/\/www.calculator.com.my\/car-loan\" target=\"_blank\" rel=\"noopener noreferrer\">Calculator.com.my.<\/a>) Do keep in mind that the longer the loan repayment period, the higher the total interest rate, so it is better to keep the loans as short as possible.<\/p> \n<p><strong>Related: <\/strong><a href=\"https:\/\/www.comparehero.my\/transportation\/articles\/car-ownership-cost\" target=\"_blank\" rel=\"noopener noreferrer\">#BreakingItDown \u2013 The True Total Cost Of Car Ownership In Malaysia<\/a><\/p> \n<p><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" src=\"https:\/\/i0.wp.com\/144634072.fs1.hubspotusercontent-eu1.net\/hubfs\/144634072\/assets_comparehero\/driving-car.jpg?resize=500%2C375&#038;ssl=1\" alt=\"\" width=\"500\" height=\"375\"><br><em>It is important to keep in mind the total cost of car ownership which includes running costs that aren\u2019t limited to maintenance fees, petrol prices, toll prices, and parking rates.<\/em><\/p> \n<h2>It isn\u2019t that simple<\/h2> \n<p>When it comes to <a href=\"https:\/\/www.comparehero.my\/transportation\/articles\/should-you-buy-car-in-covid-19-world\" target=\"_blank\" rel=\"noopener noreferrer\">buying a new car<\/a>, the price of the vehicle is the most basic of expenses. What many people forget about buying a car is the <a href=\"https:\/\/www.comparehero.my\/transportation\/articles\/car-ownership-cost\" target=\"_blank\" rel=\"noopener noreferrer\"><strong>total cost of ownership<\/strong><\/a>. It is important to keep in mind the total cost of ownership which includes running costs that aren\u2019t limited to maintenance fees, petrol prices, toll prices, and even parking rates.<\/p> \n<p>Going back to the Axia E; it is the cheapest car you can buy today, but it doesn\u2019t mean that the petrol prices and maintenance fees are going to disappear. The running cost of a lower-priced car will be cheaper, yes, but it won\u2019t be that much cheaper. According to new and used car e-commerce platform Carlist.my, it costs roughly RM2,500 for <a href=\"https:\/\/www.carlist.my\/news\/why-we-love-the-2020-perodua-axia-1-0l-e-mt-forget-premium-cheap-is-good-80565\/80565\" target=\"_blank\" rel=\"noopener noreferrer\">basic maintenance<\/a> (not inclusive of tyres and brake pads) of a Perodua Axia for the first five years, which is about RM50 a month. The Axia\u2019s 33 litre fuel tank would cost up to RM67.65 for a full tank of RON95 (RM2.05\/l)<\/p> \n<p><strong>Related:<\/strong> <a href=\"https:\/\/www.comparehero.my\/transportation\/articles\/latest-petrol-price-ron95-ron97-diesel\" target=\"_blank\" rel=\"noopener noreferrer\">Latest Petrol Price in Malaysia \u2013 RON95, RON97, &amp; Diesel<\/a><\/p> \n<p>What this means is that the <a href=\"https:\/\/www.comparehero.my\/credit-card\/articles\/best-credit-cards-fresh-grads\" target=\"_blank\" rel=\"noopener noreferrer\">fresh grad<\/a> would have to live rather frugally if they were to purchase a car that\u2019s equivalent to their annual gross income. Let us not forget that everyone\u2019s monthly income is subject to monthly statutory deductions such as <a href=\"https:\/\/www.comparehero.my\/retirement\/articles\/epf-i-sinar-withdrawal-pros-and-cons\" target=\"_blank\" rel=\"noopener noreferrer\">EPF<\/a> and <a href=\"https:\/\/www.comparehero.my\/insurance\/articles\/5-things-you-must-know-about-socso\" target=\"_blank\" rel=\"noopener noreferrer\">SOCSO<\/a> as well.<\/p> \n<p>Of course, if a person were to earn a higher gross annual income, they would have more flexibility in buying better cars or cheaper cars and saving more on a monthly basis. But it is important to always keep in mind the total cost of ownership of a car.<\/p> \n<p><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" src=\"https:\/\/i0.wp.com\/144634072.fs1.hubspotusercontent-eu1.net\/hubfs\/144634072\/assets_comparehero\/man-with-car-vector.jpg?resize=500%2C410&#038;ssl=1\" alt=\"\" width=\"500\" height=\"410\"><br><em>If a person were to earn a higher gross annual income, they would have more flexibility in buying better cars or cheaper cars and saving more on a monthly basis.<\/em>&nbsp;<\/p> \n<h2>Should you buy a car?<\/h2> \n<p>We strongly suggest that the suggested formula to buying a car is only used as a guide to help you get a rough gauge of car affordability for yourself and is not a strict guide anyone should use to purchase a car. Don\u2019t forget to take into account the usual monthly expenses too, such as food, rent, and utilities.<\/p> \n<p>Always take a look at your monthly expenses and get a clear idea of how much you can actually spare to afford a car, be it you\u2019re a fresh grad who needs a car or you\u2019re a veteran in the workforce who\u2019s looking for his weekend car. After all, if there is no real need for a new car (you have sufficient transportation everywhere), then your money is better off kept in your savings or <a href=\"https:\/\/www.comparehero.my\/investment\/articles\/investment-tips-for-gen-z\" target=\"_blank\" rel=\"noopener noreferrer\">investments<\/a>.<\/p> \n<p><strong>Related:<\/strong> <a href=\"https:\/\/www.comparehero.my\/transportation\/articles\/mistakes-when-buying-car\" target=\"_blank\" rel=\"noopener noreferrer\">#BreakingItDown \u2013 Don\u2019t Make These 9 Mistakes When Buying A Car<\/a><\/p> \n<p><\/p>\n","protected":false},"excerpt":{"rendered":"<p>This article was first published on August 8, 2018 and has been edited and updated for accuracy and clarity.<\/p>\n","protected":false},"author":268230141,"featured_media":1865,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_coblocks_attr":"","_coblocks_dimensions":"","_coblocks_responsive_height":"","_coblocks_accordion_ie_support":"","_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_wpcom_ai_launchpad_first_post":false,"_jetpack_hide_featured_image":false,"_jetpack_featured_image_duplicate_dismissed":0,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"{title}\n\n{excerpt}\n\n{url}","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2},"_wpas_customize_per_network":false,"jetpack_post_was_ever_published":false},"categories":[415],"tags":[],"class_list":["post-18185","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-wages-employment"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v28.7 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>How Much Should You Spend On A Car In Malaysia? - CompareHero<\/title>\n<meta name=\"description\" content=\"Car loan, maintenance, petrol, toll &amp; parking fees are important factors to consider when buying a car. 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