I was eating my chicken rice the other day when I noticed a man across the street exiting a majestic looking automobile.
“Why the car like chio ah?”
I nudged my friend to ask what’s that unfamiliar looking car model.
“Aiyo, it’s Rolls-Royce lah! You mean you never see one before meh?”
“I only know Toyota, Honda, Hyundai…”
Getting curious, I decided to probe and find out more.
My friend then told me that one car like this can cost more than $1 million.
I stared at that machine in disbelief, which now looked like a huge bar of gold.
I’ve always imagined to only see such cars outside good class bungalows or in a secret agent movie.
Given how cars are already so expensive in Singapore, a Rolls-Royce must be only owned by someone that’s of a finer standard of living.
So… what is this majestic beast with a 7-figure price tag?
What’s This Rolls-Royce Car All About?
A wholly-owned subsidiary of German group BMW, Rolls-Royce Motor Cars are one of the finest automobile brands ever created.
They are known to be providing luxury cars to the super-rich for over a century, and has been a hallmark of luxury and success.
They’ve also been frequently featured in movies (Iron Man, Spider-Man, Crazy Rich Asians), and even rode by the elite (Queen Elizabeth II).
Even Drake owns it.
What Makes a Rolls-Royce Car So Expensive?
Rolls-Royce cars are known for their incredibly insane level of customisation.
To begin, they currently have over 44,000 colours in their database, and a customer can choose to create their own shade of colour to whatever they want.
Like the colour of that patch of grass outside your house?
Or the colour of Miley Cyrus’s dress?
You can recreate it on your Rolls-Royce.
In fact, there have been customers requesting for crushed diamonds to be infused into their coat of paint.
A Rolls-Royce car also has a fully customisable interior, where each component can be completely based on the customer’s preferences.
This includes a starlight headliner that can recreate the night sky (fully handmade!), and even THAT can be bespoke.
If you’re one who’s interested to have your own horoscope constellation or the night sky of your birthdate, you can have it.
As you can already tell, the level of customisation is out of the world.
In fact, it is often said that a customer doesn’t walk into a Rolls-Royce showroom asking the car prices.
The customer names whatever customisation that he/she wants, and the team comes up with a price and gets it done.
How Many Rolls-Royce Cars Are There in Singapore?
According to an interview by Vanilla Luxury, there are approximately 400 Rolls-Royce cars that have been delivered to the Singapore market since 2003.
While that’s still a quantity that exudes exclusivity, the number of car buyers have been increasing speedily in the recent years.
In fact, Rolls-Royce has also observed that the average age of buyers has been dropping, from the late-50s to mid-40s.
Extreme wealth has been picking up among the younger generation, with much more self-made millionaires making fortunes in different industries.
How Much Do You Have To Earn To Afford a Rolls-Royce Car?
Alright, we’re at the fun part.
Let’s take a look at one of the most popular models, the Rolls-Royce Phantom 6.75 V12 (A).
You can now own it at $1,503,000 inclusive of Certificate Of Entitlement (price is according to sgcarmart as of 4 Sept 2020)
The Open Market Value (OMV) for the Rolls-Royce Phantom is $653,632.
(OMV = price paid or payable when a vehicle is imported into Singapore)
Since this amount is greater than $20,000, the maximum loan value would be 60% of the car price and 40% down payment.
This is assuming you’re still a regular folk that requires a car loan.
Assuming you take the maximum loan tenure of 7 years (at 2.78% interest):
- Loan amount (60% car price): $901,800
- Cash downpayment (40% car price): $601,200
Using the nifty sgcarmart calculator, the monthly installment works out to be $12,825.
Based on the vehicle details, the road tax for owning a Rolls-Royce Phantom is calculated to be $8250 a year, or $687.50 per month. (using sgcarmart’s Road Tax Calculator)
Especially for a car worth this much…
Let’s assume the following profile:
- 30-year-old female
- More than 5 years of driving experience
- 0% No-Claim Discount
Now, now. I just want to make a confession.
It was incredibly difficult to find an insurance quote for a luxury car like this.
So… based on the following profile above, we did an EXTREMELY conservative gauge by trying to find one of the most expensive cars listed on insurance comparison sites.
We landed with Maserati GranCabrio Sport 4.7A (EXTREMELY different, we know), which has an annual insurance premium of $8,179.11.
We can safely assume that the car insurance of a Rolls-Royce Phantom’s going to cost much more, given its car price of about 5x of that of Maserati GranCabrio.
Looking at the figures for our Perodua Bezza 1.3 Premium X and its insurance, we drew a parallel correlation of its price with this.
Therefore, we are going to assume that the insurance premium for a Rolls-Royce is 3x of the Maserati’s (once again, a conservative assumption!).
This brings our yearly car insurance premium to $24,537.33, which is $2,044.78 per month.
The Rolls-Royce Phantom’s fuel consumption is 7.1km/L.
Assuming you travel 50km per day, you’ll clock a total of 1,500km/month.
You make smart personal finance choices for your petrol decisions, and pay $2.31/L.
Your monthly petrol cost would be $488.03.
Assuming the following parking habits:
- HDB season parking at S$110 per month
- Office season parking at S$100 per month (highly dependent on location)
- Shopping centre parking at S$75 ($2.50/hour for an average of 8 hours a week, or 34 hours a month)
- Parking coupon-type parking at S$24 (2 booklets at S$12 each)
Your monthly parking cost would be S$309.
Let’s assume you have to cross the ERP gantry (Northbound CTE after PIE) five times each week.
Based on the latest ERP prices, this will cost $10 a week.
Which means $40 a month.
Car Servicing And Repair
Similar to our previous article, we’ll assume a conservative $100 per month for car servicing.
How Much Do You Need in Total for the Rolls-Royce Phantom?
Disclaimer: This is a very rough estimate of figures.
Also, a gentle reminder that this is on top of the $601,200 cash downpayment that you need once you purchase this car.
How Much Do You Have To Earn To Afford a Rolls-Royce Phantom?
Using the 50% expenses, 30% wealth building, 20% savings rule , let’s assume that your car takes up one-third of your expenses.
Ready to know how much you need to earn?
This means that you would need a monthly income of…
A luxury car indeed.
Is Owning A Luxury Car Worth It?
There is no doubt that owning a luxury car is a symbol of wealth and success.
The level of customisation you can get from a Rolls-Royce car is totally unrivalled, and the feeling of owning something that’s one of a kind is something a lot of wealthy individuals tend to seek for.
But a vehicle in this range would only be considered by people with sleek black titanium cards at the back of their pockets.
While it remains a dream for the bulk of us, it’s never too late to start working towards such a dream (if it is yours).
And the first step to that is to learn alongside others, and make smarter personal finance decisions. 😉