Emotions are a factor, especially during the car-buying journey. You’re sitting in the driver’s seat, imagining future road trips, daily commutes and the freedom that comes with owning a new set of wheels. That connection is strong, and it’s a significant part of why people fall in love with cars.
However, beyond the excitement, which is also an important part of the decision, it’s crucial to remember the financial realities of owning a car. Many South Africans tend to focus mainly on the monthly instalment when buying a car. If it fits today’s budget, the deal often feels achievable, and this may lead to an overlook of critical financial considerations that determine whether car ownership is feasible or becomes a long-term financial burden.
“The thrill of a new car is undeniable, but it should never come at the expense of financial stability,” says Lebogang Gaoaketse, Head of Marketing and Communications at WesBank. “When consumers take the time to understand the full financial commitment, ask the right questions and properly stress-test affordability, they place themselves in a far stronger position for confident, comfortable ownership rather than ongoing financial anxiety.” Before signing on the dotted line, buyers need to consider several key factors that are often realised too late.
What happens if your circumstances change?
Life can be unpredictable. For instance, a job change, the birth of a child, unexpected medical bills, or a job promotion may force people to relocate, thereby affecting their ability to meet monthly repayments. This is why affordability shouldn’t be assessed only on current income but also on possible changes. It’s wise to ask yourself questions such as: Can I comfortably make repayments even if my income drops by 20% or if my monthly expenses increase unexpectedly?
What protection is in place if you are unable to work?
Typically, vehicle finance agreements run for five years or longer. During this period, factors such as illness, job loss, or other life events may disrupt your income. So, it’s best to understand the safeguards in place to ensure smooth ownership of your vehicle, whether through credit life insurance, payment relief options, or other provisions. These may seem unnecessary and useless when your financial status is stable, yet they become very useful when the need arises.
What is the true cost of ownership?
There’s a lot that comes with vehicle ownership, the purchase price being one of them. Factors such as insurance premiums, fuel costs, maintenance, interest rate increases and depreciation can affect affordability over time. For example, a car with an R5,000 monthly payment can cost R7,500 per month once the full cost of ownership is considered. Unfortunately, these can put pressure on finances if they are not accounted for.
How does your deposit impact long-term risk?
Paying a larger deposit can lower the amount financed, the monthly repayments and the total interest paid over the loan term. Not only that, but it also offers protection against early depreciation, as owing more on a car than its market value can create vulnerabilities if the car needs to be sold or is written off.
Car finance in South Africa is more flexible than ever, making ownership easier. But monthly payments of 25-30% of your total income can strain your budget. Experts recommend keeping all car costs under 15-20% of your monthly income.
“It is critical to fully understand your finance agreement before signing,” adds Gaoaketse. “Consumers should always ask what flexibility exists if they need to restructure payments temporarily, whether early settlement penalties apply, what happens if the vehicle is written off, and whether there are options to reduce monthly commitments if needed. Knowing the answers upfront creates confidence and can prevent significant financial hardship later.”
When used wisely, finance can help you get a reliable car while still leaving money for other priorities. The key is to see it as a long-term commitment, not just a monthly payment. Thinking this way helps you make smarter decisions that you’ll appreciate in the future.
