All petrolheads dream about owning and driving a Ferrari. You are not a certified petrolhead if you’ve not dreamt of driving a Ferrari. It’s a dream that remains so for most of the people and only few lucky ones are able to own this Italian beauty.
In this post we discuss the hypothetical scenario of how someone with limited means of income can plan to buy a Ferrari. Before we go further it's important to note that this is after all a dreamer’s guide and describes a hypothetical scenario.
First things first! It’s critical to realize why you are buying a Ferrari. In India, car is a status symbol and most of the people tread the middle path between value for money and the status symbol the car brings to the person’s life. However with changing times, advent of Internet and high disposable incomes, there is a breed of hot shot buyers who are more discerning and passionate about the underlying machines. So if you are not a true car lover and don’t have crores casually lying in your house, we would strongly suggest to not buy a Ferrari.
A lot of money can be saved if one decides to buy a pre-owned car. All cars lose a hell lot of value as soon as they step out of the showroom. As per investopedia, a car loses 20% of its value once it's out of the showroom. So if you really want to buy your dream Ferrari then it has to be a pre-owned ferrari because it really doesn’t make sense to do otherwise. And for pre-owned luxury car, you know where you need to go right?
Now coming to the math and planning for buying a Ferrari. Here are some assumptions and steps for buying the Ferrari:
This is a no brainer. If you are not earning a couple of lacs in a month then it's time to up your game and start slogging at work. Even though this is a Dreamer’s guide & unless you plan to steal one, buying a pre-owned Ferrari will need a hell lot of monies! Sorry to burst the bubble.
Once you start raking in the moolah it's time to start saving big time. You would need at least 10-20 lacs saved on the side to get a loan for a Ferrari. This would vary from bank to bank and person’s own credit history.
As soon as you hit the 2 lac per month of earning and savings upwards of 10 lacs, this is the time to start searching for a pre-owned Ferrari. At the risk of sounding arrogant, we think your first stop should be the Big Boy Toyz website, there is no better place to start with!
1 crore. That’s the minimum possible amount for a pre-owned and good-conditioned Ferrari. Do note that this cost is only for the cheaper Ferrari’s like a 2006 Ferrari F430 Spider or versions near to this car. If you want to buy a more adrenaline pumping beast, be prepared to shell out double the money.
Let’s assume that: “you find a decent Ferrari from a well known and trustworthy place”. And it's costing you a whopping Rs. 1 crore. It’s time to call your banker friends and start figuring out the loan process.
20 lacs. This is the amount you are willing to pay as down payment for the car. Now let us figure out how much a monthly EMI you can chew without breaking your teeth in the process. You will need a loan of 80 lacs for a car worth 1 Crore. At an interest rate of 9.05% & a tenure of 20 years, a loan of 80 lacs will have a monthly EMI of 72,687.
Once you pass through the hurdles of getting the bank loan and paying for the beast, you will be entering a whole new realm where only the dreamer’s dwell. That’s FerrariVille for you. A dream-like existence powered by pure adrenaline and gasoline. Just make sure that you buy the beast from a reliable source because a dream can turn into a nightmare with a blink of an eye. Maintaining a Ferrari is not easy and can be a real hit to the pocket if one is not regular in services and upgrades. After all, a car needs pampering and a Ferrari will definitely need to be pampered with the best of car care available.