Find out here if you can afford the bike or not
The recently launched KTM 390 Adventure is one of the most sought-after adventure bikes for motorcyclists from all over India. Currently, it is approximately priced at Rs 4,25,000 on-road Pune, but it may vary according to the city, state, and dealer. Now that you have been awarded your appraisal or are about to receive it later this month, many of you might be wondering whether you will be able to afford one of the best value-for-money adventure bikes in India. But before you buy it, you will need to have an idea on how much you must earn so that you can easily pay for the bike, especially if you take a loan for the purchase. We can calculate the costs and arrive at the monthly income required, with various slabs.
Loan Amount
Let us compute how much loan you can take based on monthly salary amounts of Rs 20,000, Rs 50,000, and Rs 1,00,000. A general rule of thumb when it comes to big vehicle purchases is to keep in mind that the EMI should not be more than 15% of your monthly salary. Let us consider the most common rate of interest for a vehicle loan, which is 9% per annum, and for a five-year period (60 months).
Down Payment
The on-road price in Pune for the KTM 390 Adventure adds up to Rs 4,25,000 after adding insurance, and RTO registration charges to the ex-showroom price of the motorcycle. And, the down payment at 10% value on the total on-road cost for the bike comes in at Rs 42,500.
Formula for EMI Calculation
P x R x (1+R)^N / [(1+R)^N-1] where:
- P = Principal loan amount,
- N = Loan tenure in months,
- R = Monthly interest rate
If you find this to be too complicated, worry not, as we have an EMI calculator in which you can simply enter the various parameters and get the final amount. You can do so by clicking this link. The cost of the bike after the five-year loan amounts to Rs 5,18,900.
Rs 20,000
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For a monthly income of Rs 20,000, the highest EMI possible is Rs 3,000 (15% of monthly income).
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Based on the EMI formula, the max loan amount that can be borrowed comes to Rs 1,87,000 – including the down payment cost.
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But this loan figure is quite low in relation to the cost of the KTM 390 Adventure, so this income level is not enough to pay for the bike.
Rs 50,000
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If the monthly income is Rs 50,000, the EMI that can be taken is Rs 7,500 (15% of the monthly income).
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Based on this EMI level, the loan amount that can be taken is Rs 3,61,300.
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If Rs 42,500 downpayment is also added, the loan amount becomes Rs 4,03,800.
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It is Rs 1,15,100 lower than the cost of the KTM 390 Adventure with the down payment.
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If you can add Rs 1,918 more to the monthly EMI and make it Rs 9,418 – then you will be able to afford the motorcycle (maybe skip a few late night outings and parties for this).
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This level of income is just about enough to be able to buy the bike, if you can skip out on a few things in a month.
Rs 1,00,000
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For a monthly salary of Rs 1,00,000, the highest EMI one can take is Rs 15,000 (15% of salary).
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The highest amount of loan that can be managed is Rs 7,22,620.
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And adding the down payment amount, the total would come to Rs 7,65,120 – which is more than enough to fund the entire cost of the KTM 390 Adventure.
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But a loan would not really be required with this monthly salary.
Summing up, here’s a visual representation based on monthly income:
|
Monthly Income |
Maximum EMI (15% of income) |
Maximum Loan Amount That You Can Afford To Take (5 years, 9% interest) |
Total Loan + Downpayment |
Is It Enough for a KTM 390 Adventure? |
|
Rs 20,000 |
Rs 3,000 |
Rs 1,44,500 |
Rs 42,500 + Rs 1,44,500 = Rs 1,87,000 |
Not enough |
|
Rs 50,000 |
Rs 7,500 |
Rs 3,61,300 |
Rs 42,500 + Rs 3,61,300 = Rs 4,03,800 |
Enough, if you can add Rs 1,918 to monthly EMI |
|
Rs 1,00,000 |
Rs 15,000 |
Rs 7,22,620 |
Rs 42,500 + Rs 7,22,620 = Rs 7,65,120 |
More than enough |
BikeDekho Says
In essence, you should be able to afford the KTM 390 Adventure on loan if your take home salary is at least Rs 50,000. That said, we would recommend you keep an extra buffer to consider your fuel and maintenance bills. Thankfully, KTM bikes are generally known to be fairly affordable to maintain with inexpensive spare parts. Mind you, if you are into off-roading, you might have to factor in the expenses related to part breakage as well.
Before signing up for a loan, always ensure that you can afford the loan repayment without pinching your pockets. Also ensure that your source of income is stable for at least as long as the tenure of the loan. This makes sure that you are able to enjoy your new KTM 390 Adventure to the fullest extent.
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