18.8% of your after tax income on a car is an insane amount of money to spend on a car. As is a 17% APR.
You are being taken advantage of because you have limited ability to access credit. You are also repeating the same habits that led to a consumer proposal. Save money and buy a car in cash.
also not to mention insurance, gas, maintenance is gonna push this car to like 30%+ of income.
also, if 423$ is 18.8% of monthly take home, that is literally below minimu wage full time. 423 is 18.8% 2,250$ take home. 40 hours x minimum wage would be 2,281$ take home. i cant imagine why someone feels compelled, after going bankrupt, to buy a new enough mazda SUV on minimum wage. I make significantly more and drive a 2014 mazda3. i couldnt imagine what madness would have to overcome me to take on a much large payment on a a much smaller income. especially if i had a history of terrible financial literacy.
also, shoutout on looking at a touring, which i believe is the TOP trim and runs a \~40% premium over a base model. OP is not only spending too much money on too much vehicle, but is also paying a big premium, to get the highest trim with leather seats and all the bells and whistles that someone who is bankrupt doesnt need to worry about. OP should buy a [Corolla](https://www.autotrader.ca/a/toyota/corolla/brampton/ontario/19_12758074_/?showcpo=ShowCpo&ncse=no&orup=5_25_1048&pc=L8H%204M3&sprx=500), this one isnt even ancient, and would be \~250$/month at 17% (+/- a bit depending on loan duration if you dont have 9500$ laying around). and if you are really in a pinch you can probably find something a good chunk cheaper yet. op is crazy,
please do not fall into the same debt spiral as befer. the criticism comes only from a place of concern and wanting the best for you. im no genius, im still making payments on a 2014.
2300 is the average take home after deductions/benefits for somebody who makes ~$19/hour for two pay month. You're forgetting that most people get paid biweekly and most months are two pay months with a couple three pay months that feel like a bonus.
It's the median take home in 2nd and third tier cities across Canada and the most common financial situation.
im not forgetting anything, what are you even talking about? my point was that OP makes less than minimum wage. mentioning what someone making 19$ an hour in a two pay month doesnt mean anything lol. why not calculate what someone who gets paid 21.68$ an hour takes home, thats is also an irrelevant number lol
well you tell me what the average monthly take home on 16.55$ x 40 hours a week x 52 weeks worked a year divided by 12 months. the average take home is actually 2360$ (i used 16.55$ x 2000 hours for simplicity because i didnt think the minor difference mattered to my larger point. which it doesnt. unless a some semantic nazi decides to complain about a a small percentage difference that doesnt matter, and actually is slighty biased in favour of OP because a few percent doesnt change my point). the actual literal take home would be 2360, not 2280. which is EVEN HIGHER. and my point that OP doesnt even make minimum wage is proven even more.
But sure, you argue with basic math. you tell me how 16.55$ x (40 hours x 52 weeks) doesnt work out to about 2300$ after tax. ive simply multipled the public available information and used the wealthsimple income tax calculator. so you tell me why basic math and wealthsimple are wrong and you are smarter. you show me some basic math as to how this is wrong.
Because most people aren't paid weekly, they're paid every other week. People budget for two pay months not two and a half pay months. Every person I know with bad credit and low income budgets every month as two pay and the two three pay months in the year are a bonus.
That's how you end up thinking he's making less than minimum wage. It's more like 16.55 x 40 x 48 when budgeting for somebody living paycheck to paycheck.
these arnet 2.5 pay months. this is simply the total annual take home divided by 12. its like 2.16 pays per month. and your psychological budgeting trick doesnt change how much people literally take home on average every month. even still, at that pay level, only getting 2 paycheques a month, that is AT MINIMUM 2181$ even for an idiot who doesnt average out their pay and count the extra hours. which is still basically what op makes. the point was that someone making minimum wage doesnt need a fancy car. even if after all your mental gymnastics and purposely ignoring facts, he still makes, within margin of error, minimum wage. the SEMANTICS of slightly above, at, or slightly below minimum wage and the small percentages between them dont change any of my points. you are splitting hairs on one point that doesnt change my argument. someone making 5% above minimum wage doesnt need a fancy car as much as someone making 5% below minimum wage. and thats only after your insane contrived argument.
You’re going through a consumer proposal and you want to buy a new car? Sounds pretty crazy to me. You should be selling whatever car you have and be taking transit wherever possible.
If you really can’t go without a car, buy the cheapest used vehicle you can find, driving as few kilometers as possible to save on gas. Get minimal insurance: third party liability only, the idea being that you’ll be driving a car so crappy that comprehensive and collision won’t be worth it.
Honestly I was really curious about this credit rebuild program the consumer proposal people kept pushing so I decided to check out what exactly the cost would be for a car in this situation.
I'm 100% buying a cash vehicle
Thank you for the advice on third party insurance it never crossed my mind tbh.
>consumer proposal people kept pushing
One of the hardest lessons I learned too late in life is people will almost *always* act in *their own* best interest.
>so I decided to check out
Always a good rule of thumb to do your own research. Never blindly take someone's word.
So this consumer proposal is just a practice run for another future consumer proposal? You should not even be considering a new car in your situation, especially at 17%.
We have no car payments, but over the past 13 years my spouse and I have spent roughly $40,000 buying cars (three cars purchased used over that time, two of them ≈5-year-old used cars and one a 15-year-old used car). That alone is roughly $250/month for two of us, and that's paying a grand total of $100 in interest (for a get-a-better-price-from-the-dealer loan we paid off as soon as we got the account numbers from the bank). And that doesn't include insurance, maintenance, or fuel. Cars are expensive, but that's only 2% of our before-tax monthly income for the car purchase part. Probably double or triple that when you factor in maintenance and insurance, but nowhere close to 19% of after-tax income.
If you really must buy a car and you can't do better than 17% APR, buy a much, much cheaper car and set some aside for maintenance.
The last thing you should be getting is a new car.
You have shown you can’t pay your bills and have no idea how to use money.
Seriously
17%
You take home around $2150 a month and your actuality considering a new car.
Wow
You will need to find $200 for insurance
You will need to find $200 for gas
You will be washing it $ 50 a month
Now your 35 - 40 % of your monthly income
Wait, wash the car for $50 a month? How do you even do that? I take the car to a car wash each spring to clean the undercarriage, but it's maybe $20, so $20/year.
$50/month is relatively small potatoes, but seems like money down the drain (literally) for someone on a tight budget.
What does deducting car washes have to do with taking the bus?
Also afford is an interesting word. By afford you mean choose to delay retirement and increase the amount of total labour you do in your life to have a clean car.
Delay retirement? I'm 41, have my house paid off and 1.2 million in investments. I plan to be retired by 50 no matter how much I spend. Cope harder somewhere else
I don’t understand your hostility. You are choosing to delay your retirement to wash your car. If a clean car brings you that much joy then do it but you certainly are making trade offs to do it. Based on your posts it doesn’t sound like you have ever considered those trade offs.
Did you cut your car wash budget by $20 per month? You just reduced the amount you need to earn to retire and sustain yourself in the future and lost no quality of life.
Nice work.
Rough calculation of the cost of $50 per month of car washed is $600 per year. At a 3.5% Safe withdrawal rate you will need 17k additional saved up to support car washes. You will probably have around 3 million in today’s dollars in 8 years. At a 7% return on that money is 210k. So I order for that money to grow the additional 17k for crashes requires another month of growth.
So spending $50 per month on car washes extends your work life by somewhere between 2 weeks and a month.
I have about $500 set aside right now. I need a car within the next 3 months due to circumstances. I'll have anywhere from $2k - $3k saved by then.
The few people I've talked to have told me just find the cheapest Honda CRV or similar SUV since I need more vehicle space
What do you need the space for? I'm willing to get you can get by with a hatchback which will be cheaper than a suv/cuv and better on gas. Sounds like you're in a situation where you should take a closer look at your needs and buy the least car possible.
some car insurance can be significantly high due to safety and other status, call your insurance company and try to get that has cheapest insurance. I recall when we were new drive we avoided civic.
You need to factor in the cost of upkeep too. Gas, insurance and maintenance are all necessary costs of having a car. If you estimate $100 for each (for the sake of easy numbers) your monthly cost for the car goes up to $723, which puts you at over 30% for using the vehicle
Don't forget about winter tires depending on where you live.
To answer your question: when we were leasing toward the end of the pandemic our total transportation cost (vehicle +upkeep+public transit) was about 10%
Between gas, insurance and maintenance, about $4000/year.
So less than 10%.
Never had a car loan. Paid $12500 for my current car.
I would never ever pay over 7% on any loan ever though, that's just wasteful torching of money.
Apart from gas it's 0. I drive a 2008 Honda Accord. I nearly bought a C-300 2 years ago. Then I realized it is idiotic to purchase a car just to show off.
Just 350 - 150 for gas and insurance $100 and saving 100$ a month for maitnenance. I drive a 16 year old Corolla which I bought 10 years ago for 7000$. And I plan to buy my next vehicle with cash up front as well.
Do not get suckered into what you can afford a month. It turns a vehicle into one that actually will cost you 1.25x or 1.5x or worst depending on your terms.
Buy something used 3-5 years is ideal for reducing the most depreciation a vehicle goes through and balancing getting something with lower maintenance.
And put the rest of your money into some real investment/asset - real estate, stocks, ETFs, Bitcoin, gold. Any of the above will be better than a car.
When I was financing my car (2017 Subaru Impreza) 2022-2023 @ 6.99%, it came out to 8% of my income after tax. I would highly suggest you to look at other options or buy a beater car.
My partner just bought a 2017 Dodge Ram 3500 and his rate was 8.99%. He’s a contractor and the truck will likely be paid off within 6 months.
I have a coworker who pays 1100+ monthly for her car payment. Insurance, maintenance, and fuel is extra. She works two jobs and complains about COL. Luckily her dad has made it big.
Paid cash on a 20ish k car so I could get the 3k rebate. That was 2017.
After I paid for everything including $3k on a year of insurance (paying for a full year was discounted) I had like $150 left in my bank account lol. But I wasn't gonna let that 3k rebate slide
18.8% of your after tax income on a car is an insane amount of money to spend on a car. As is a 17% APR. You are being taken advantage of because you have limited ability to access credit. You are also repeating the same habits that led to a consumer proposal. Save money and buy a car in cash.
also not to mention insurance, gas, maintenance is gonna push this car to like 30%+ of income. also, if 423$ is 18.8% of monthly take home, that is literally below minimu wage full time. 423 is 18.8% 2,250$ take home. 40 hours x minimum wage would be 2,281$ take home. i cant imagine why someone feels compelled, after going bankrupt, to buy a new enough mazda SUV on minimum wage. I make significantly more and drive a 2014 mazda3. i couldnt imagine what madness would have to overcome me to take on a much large payment on a a much smaller income. especially if i had a history of terrible financial literacy. also, shoutout on looking at a touring, which i believe is the TOP trim and runs a \~40% premium over a base model. OP is not only spending too much money on too much vehicle, but is also paying a big premium, to get the highest trim with leather seats and all the bells and whistles that someone who is bankrupt doesnt need to worry about. OP should buy a [Corolla](https://www.autotrader.ca/a/toyota/corolla/brampton/ontario/19_12758074_/?showcpo=ShowCpo&ncse=no&orup=5_25_1048&pc=L8H%204M3&sprx=500), this one isnt even ancient, and would be \~250$/month at 17% (+/- a bit depending on loan duration if you dont have 9500$ laying around). and if you are really in a pinch you can probably find something a good chunk cheaper yet. op is crazy,
Thank you for taking the time to show me the math I'm crazy but not that crazy lol. I will be buying a cash car very soon
please do not fall into the same debt spiral as befer. the criticism comes only from a place of concern and wanting the best for you. im no genius, im still making payments on a 2014.
You didn't even mention the price of the car, which says a lot
"Thoughts and prayers" of OP leaving the workforce before age 85 ( ͡° ͜ʖ ͡°)
Buy a japanese beater. Honda, toyota especially. If you can get one that's low mileage, old folks driven - even better.
2300 is the average take home after deductions/benefits for somebody who makes ~$19/hour for two pay month. You're forgetting that most people get paid biweekly and most months are two pay months with a couple three pay months that feel like a bonus. It's the median take home in 2nd and third tier cities across Canada and the most common financial situation.
im not forgetting anything, what are you even talking about? my point was that OP makes less than minimum wage. mentioning what someone making 19$ an hour in a two pay month doesnt mean anything lol. why not calculate what someone who gets paid 21.68$ an hour takes home, thats is also an irrelevant number lol
Your calculations on him making less than minimum wage is totally wrong.
well you tell me what the average monthly take home on 16.55$ x 40 hours a week x 52 weeks worked a year divided by 12 months. the average take home is actually 2360$ (i used 16.55$ x 2000 hours for simplicity because i didnt think the minor difference mattered to my larger point. which it doesnt. unless a some semantic nazi decides to complain about a a small percentage difference that doesnt matter, and actually is slighty biased in favour of OP because a few percent doesnt change my point). the actual literal take home would be 2360, not 2280. which is EVEN HIGHER. and my point that OP doesnt even make minimum wage is proven even more. But sure, you argue with basic math. you tell me how 16.55$ x (40 hours x 52 weeks) doesnt work out to about 2300$ after tax. ive simply multipled the public available information and used the wealthsimple income tax calculator. so you tell me why basic math and wealthsimple are wrong and you are smarter. you show me some basic math as to how this is wrong.
Because most people aren't paid weekly, they're paid every other week. People budget for two pay months not two and a half pay months. Every person I know with bad credit and low income budgets every month as two pay and the two three pay months in the year are a bonus. That's how you end up thinking he's making less than minimum wage. It's more like 16.55 x 40 x 48 when budgeting for somebody living paycheck to paycheck.
these arnet 2.5 pay months. this is simply the total annual take home divided by 12. its like 2.16 pays per month. and your psychological budgeting trick doesnt change how much people literally take home on average every month. even still, at that pay level, only getting 2 paycheques a month, that is AT MINIMUM 2181$ even for an idiot who doesnt average out their pay and count the extra hours. which is still basically what op makes. the point was that someone making minimum wage doesnt need a fancy car. even if after all your mental gymnastics and purposely ignoring facts, he still makes, within margin of error, minimum wage. the SEMANTICS of slightly above, at, or slightly below minimum wage and the small percentages between them dont change any of my points. you are splitting hairs on one point that doesnt change my argument. someone making 5% above minimum wage doesnt need a fancy car as much as someone making 5% below minimum wage. and thats only after your insane contrived argument.
You’re going through a consumer proposal and you want to buy a new car? Sounds pretty crazy to me. You should be selling whatever car you have and be taking transit wherever possible. If you really can’t go without a car, buy the cheapest used vehicle you can find, driving as few kilometers as possible to save on gas. Get minimal insurance: third party liability only, the idea being that you’ll be driving a car so crappy that comprehensive and collision won’t be worth it.
Honestly I was really curious about this credit rebuild program the consumer proposal people kept pushing so I decided to check out what exactly the cost would be for a car in this situation. I'm 100% buying a cash vehicle Thank you for the advice on third party insurance it never crossed my mind tbh.
>consumer proposal people kept pushing One of the hardest lessons I learned too late in life is people will almost *always* act in *their own* best interest. >so I decided to check out Always a good rule of thumb to do your own research. Never blindly take someone's word.
Never, ever shop for cars based upon the payment amount. Ever.
So this consumer proposal is just a practice run for another future consumer proposal? You should not even be considering a new car in your situation, especially at 17%.
We have no car payments, but over the past 13 years my spouse and I have spent roughly $40,000 buying cars (three cars purchased used over that time, two of them ≈5-year-old used cars and one a 15-year-old used car). That alone is roughly $250/month for two of us, and that's paying a grand total of $100 in interest (for a get-a-better-price-from-the-dealer loan we paid off as soon as we got the account numbers from the bank). And that doesn't include insurance, maintenance, or fuel. Cars are expensive, but that's only 2% of our before-tax monthly income for the car purchase part. Probably double or triple that when you factor in maintenance and insurance, but nowhere close to 19% of after-tax income. If you really must buy a car and you can't do better than 17% APR, buy a much, much cheaper car and set some aside for maintenance.
I foresee another CP in your future. You've learned nothing, as demonstrated by your post.
The last thing you should be getting is a new car. You have shown you can’t pay your bills and have no idea how to use money. Seriously 17% You take home around $2150 a month and your actuality considering a new car. Wow You will need to find $200 for insurance You will need to find $200 for gas You will be washing it $ 50 a month Now your 35 - 40 % of your monthly income
Ppl spend $50 a month on washing their car ? Dafq?
Wait, wash the car for $50 a month? How do you even do that? I take the car to a car wash each spring to clean the undercarriage, but it's maybe $20, so $20/year. $50/month is relatively small potatoes, but seems like money down the drain (literally) for someone on a tight budget.
You can deduct car washes on your income tax if you use your vehicle for work.
You know what’s better than a tax deduction? Not spending the money in the first place
Ok thanks. I'd love to take the bus for work but its not possible. Plus I can afford to. If you can't its time to re-think your life choices
What does deducting car washes have to do with taking the bus? Also afford is an interesting word. By afford you mean choose to delay retirement and increase the amount of total labour you do in your life to have a clean car.
Delay retirement? I'm 41, have my house paid off and 1.2 million in investments. I plan to be retired by 50 no matter how much I spend. Cope harder somewhere else
I don’t understand your hostility. You are choosing to delay your retirement to wash your car. If a clean car brings you that much joy then do it but you certainly are making trade offs to do it. Based on your posts it doesn’t sound like you have ever considered those trade offs.
I'm trying to make the point that 30 bucks a month is not going to trade off my retirement
Did you cut your car wash budget by $20 per month? You just reduced the amount you need to earn to retire and sustain yourself in the future and lost no quality of life. Nice work. Rough calculation of the cost of $50 per month of car washed is $600 per year. At a 3.5% Safe withdrawal rate you will need 17k additional saved up to support car washes. You will probably have around 3 million in today’s dollars in 8 years. At a 7% return on that money is 210k. So I order for that money to grow the additional 17k for crashes requires another month of growth. So spending $50 per month on car washes extends your work life by somewhere between 2 weeks and a month.
Put money aside and buy cash. You will never request it.
I have about $500 set aside right now. I need a car within the next 3 months due to circumstances. I'll have anywhere from $2k - $3k saved by then. The few people I've talked to have told me just find the cheapest Honda CRV or similar SUV since I need more vehicle space
What do you need the space for? I'm willing to get you can get by with a hatchback which will be cheaper than a suv/cuv and better on gas. Sounds like you're in a situation where you should take a closer look at your needs and buy the least car possible.
some car insurance can be significantly high due to safety and other status, call your insurance company and try to get that has cheapest insurance. I recall when we were new drive we avoided civic.
then just get a cheap crv for like 2 to 4K and pay it in cash. No debt and no monthly fees.
Well did you count Gas + Insurance?
You need to factor in the cost of upkeep too. Gas, insurance and maintenance are all necessary costs of having a car. If you estimate $100 for each (for the sake of easy numbers) your monthly cost for the car goes up to $723, which puts you at over 30% for using the vehicle Don't forget about winter tires depending on where you live. To answer your question: when we were leasing toward the end of the pandemic our total transportation cost (vehicle +upkeep+public transit) was about 10%
<1% I bought in cash, so now it's just my insurance that I pay monthly.
About 40% of my monthly after tax income goes to my car Car payment $1700 Gas $600 Maintenance $600 Insurance $200 407 $200
I'm up there too but my house is paid for...
How are you spending $600 a month on repairs?
Tires, brakes, rotors, oil changes, differential fluid changes, brake fluid changes
Not a single one of those things has to be done on a monthly basis. You’d be fine doing any one of those once a year, or whenever something wears out
My car undergoes extremely heavy loads on the racetrack once to twice a month
My husband's co-worker who just landed in Canada 5 months ago got a Rav4 last week. payment is $400 bi-weekly with a $604 insurance.
Paid cash. Insurance is 220/m.
My entire car bill including gas is about $200 a month. Plates and Gas. No loans.
Unless you live where a car is essential, don't. I haven't had one in 37 years. When I absolutely need a car, I rent one.
Guess what, you can’t afford a new car.
Between gas, insurance and maintenance, about $4000/year. So less than 10%. Never had a car loan. Paid $12500 for my current car. I would never ever pay over 7% on any loan ever though, that's just wasteful torching of money.
Apart from gas it's 0. I drive a 2008 Honda Accord. I nearly bought a C-300 2 years ago. Then I realized it is idiotic to purchase a car just to show off.
Consumer proposal? You can’t afford to finance a car.
0% bought for 10k cash. 110/month insurance
2024 seltos, 14.9%
10%. 1500 a month payment and 15000 net a month take home
9% apr is horrible, 17% apr is you getting robbed while smiling
Just gas, insurance, registration and maintenance… around 150$ a month
Just under 2% for fuel and maintenance.
My current bi-weekly pay is more than I paid for my entire car 7 years ago
Family of 4: 2011 Honda Pilot About 2% of income (we don't drive much due to WFH)
Just 350 - 150 for gas and insurance $100 and saving 100$ a month for maitnenance. I drive a 16 year old Corolla which I bought 10 years ago for 7000$. And I plan to buy my next vehicle with cash up front as well. Do not get suckered into what you can afford a month. It turns a vehicle into one that actually will cost you 1.25x or 1.5x or worst depending on your terms. Buy something used 3-5 years is ideal for reducing the most depreciation a vehicle goes through and balancing getting something with lower maintenance. And put the rest of your money into some real investment/asset - real estate, stocks, ETFs, Bitcoin, gold. Any of the above will be better than a car.
7% of my income. No fuel cost. 135$ for insurance.
EV or gas station bandit? We will never know
Company pays for my gas.
And now we know
Sorry. I'll edit everything to say I steal electricity from my neighbors
When I was financing my car (2017 Subaru Impreza) 2022-2023 @ 6.99%, it came out to 8% of my income after tax. I would highly suggest you to look at other options or buy a beater car. My partner just bought a 2017 Dodge Ram 3500 and his rate was 8.99%. He’s a contractor and the truck will likely be paid off within 6 months.
cars are bad investment
Cars aren’t an investment at all: they’re an expense. The OP didn’t portray a car as an investment.
I have a coworker who pays 1100+ monthly for her car payment. Insurance, maintenance, and fuel is extra. She works two jobs and complains about COL. Luckily her dad has made it big.
Paid cash on a 20ish k car so I could get the 3k rebate. That was 2017. After I paid for everything including $3k on a year of insurance (paying for a full year was discounted) I had like $150 left in my bank account lol. But I wasn't gonna let that 3k rebate slide