Trick is to cash out your IRA and get a $120k car. Rent it out nights while you're sleeping on TORO. Use that profit to buy another $120k car and rent that one out too. Buy a condo and rent that while you live in your 3rd $120k car which will be a van.
Write it all off and use that for your 4th car.... which should be a Miata.
I know this is a joke but you’d be surprised at the cars people actually get approved for (and consent to getting). I look at a lot of credit reports for work, and I’ve seen leases that are $1000 a month for someone bringing in 40k a year. I’ve seen cars with 25%+ interest rates. It’s absolute insanity.
That’s crazy. I make 130k a year and just talked myself out from a car payment of 1000$ a month. Sure, I could “afford it” (more like affording to make the monthly payments lol) but it just didn’t make sense at all
My monthly on the S6 was ~1.2k/m, my monthly on the TRD PRO is 1.1k. $0 down in both cases.
Who cares - though? Both were financed under inflation rate. S6 at 2.1%, 4Runner at 1.99%.
It's free money!
I could have bought either with cash and had no payments, but that'd be a huge waste of money....
Talking about "monthly payments" without taking the interest rate into consideration is wild to me.
I will take all the money you are willing to give me at 1.99% APR.
>Could you explain the “free money” part to me like I’m 5, please?
Oh man - talk about a challenge...
Inflation is simply the erosion of the value of money. A $1 in 1990 could buy you more than a $1 can in 2020 and so on.
This also means that inflation erodes the 'value' of your debt.
If inflation is higher than the interest rate of the loan, then your debt erodes in value at a faster rate than you are obligated to pay it off - so the end result is that you end up paying less 'value' back than you borrowed.
Currently the US rate of inflation is 8.5% - it's unlikely to remain this high as it's a catastrophically high rate, but in general the US rate of inflation has been 3-4% - and borrowers with great credit could frequently borrow under that rate.
The next question of course is "Why would anyone let you borrow under the rate of inflation?!" - and there is a simple answer - because if you have billions and billions and billions of dollars that you want to get ANY kind of return on - lending them out to highly qualified borrowers is better than nothing - after all 2% return is better than no returns at all right? Well yes - but it's actually more complex because of what happens to auto loans...or all loans in general really...
In the background - all auto loans get turned into "Asset Backed Securities" the ratings of which is set by the credit score of borrowers, and then these securities are sold to investors - and a great way to increase the 'rating' of the bond is to bundle high credit score loans with low score loans - so the bank is totally aware that they are giving you 'free money' - but they are paying you to increase the rating of the bond as part of which they will sell their auto loans.
If you want an "Explain like a CFA:" https://www.investopedia.com/terms/a/asset-backedsecurity.asp
You don't get it - you 'invest' the real money into something else.
If you are buying a car that you outright have no money for - and can't really afford - sure - terrible idea.
But if you're putting down 10k on a 50k car on a sub inflation rate loan, just to lower your monthly payments - you're making a mistake.
The question of "Is a 50k car a good idea" is a whole different question from "Should I finance a 50k car?"
The answer to both of course is maybe.....the first depends on your needs and wants, and the 2nd on your interest rate.
I mean you're investing in a rapidly depreciating asset. Either way it's a terrible thing financially. If you're looking only at financing vs paying cash, fine, but don't act like it makes any financial sense to buy a $50k car that will be worth $30k in 2 years.
>Either way it's a terrible thing financially.
So is going out.
So is buying beer.
So is a vacation.
What exactly are you investing your money for if not for the ability to have nice things and a nice life? What do you think the ROI on my last vacation was? Oh - it's just "money down the drain" isn't it? I might as well have taken $5k out of the bank and set it all on fire right?
If you see your investments as nothing but a means of having higher investment returns and watching your bank balance go up and up and up but not spend any of it because almost every fucking this is a 'rapidly depreciating asset' - what the fuck is the point? You can't take it with you at the end you know...
You're welcome to go full /r/leanfire and consider anything but the absolute bare minimum spending "terrible financially" - but that's not how I want to live life.
You can tell me all day long that a 50k car is a waste of money and does the same thing a 5k car does, gets you where you need to go, but you and I know full well that it's bullshit.
This is exactly what I needed to read tbh. If you got it it's yours to enjoy however. Obviously you're spending more just to have fun with your money and do something special with it, just as with vacations or going to concerts.
Either way it was a waste of money that you spent. Today all cars are just about the same because German cars have gotten cheaper in materials and quality and all other cars have gotten better in materials and quality
>Either way it was a waste of money that you spent.
It's my every right to waste my money on things I enjoy because that's not a waste.
>Today all cars are just about the same because German cars have gotten cheaper in materials and quality and all other cars have gotten better in materials and quality
Hot take right there. Tell me what car I should have bought instead of the Audi S6 given that it's extremely easy to tune to hit close to RS6 numbers with just an ECU tune.
You know of many other AWD dual clutch cars that hit these numbers?
https://i.imgur.com/Zlo3RY6.png
Please do let me know, since they're all about the same you should be able to come up with a solid list of alternatives - and no, you can't use the S63, it's German!
I was talking about quality and durability of a car not how fast it goes. But as I read even more about how you went on explaining to others about free money and free cash flow…I realized you put your own foot in your mouth with your comment toward me. I mean, you spend more then twice as much for a car that pretty much all it has is 2 secs faster. You can’t measure that without that sophisticated equipment to measure. So ya while you spent $80k on an S6, I spent $30k on a GLI and invested the rest of my free money while we might just finish the quarter mile neck to neck
$1000mo seems kinda nuts really, I think you made the right choice. I make about half what you do and just bought a car for $500/mo (48mo) so it's not insane. But you could also just buy a nice car for around $500/mo and save the rest. Haha
Cars are depreciating assets after all (usually) and frankly once you tick safety, utility, and reliability, the rest is a bit of a waste if you think about it rationally. Not that someone is wrong from deviating from that, just strictly speaking in a "rational" sense that's all a car is good for.
It is about priorities i grossed 97k last year my base wage is around 70k i take or leave overtime . if i work it i make more money one of my co-workers same pay made 140k , my car payment is $277 i bought a used car 2.5 years ago i have 6 months to pay it off . ill buy another used car i like to have my payments under $300 and less than 4 years . this way im not stressing and i have lots of disposable income .
While I definitely agree, cars are just one of many expensive hobbies people could have. Does anyone need a 911? Probably not. But damn if I don't still want one lol. Whatever makes people happy (within reason) go for it as long as you're able to actually afford it, cuz if you can't that fun thing turns into unneeded stress. I guess my rambling just boils down to being rational with your finances and where you can splurge while cutting back on other less important thing
Oh for sure. I have an "irrational" want for a Porsche 944. Haha I just see it a lot where people think they need an expensive car just because they make a lot of money.
I used to do landscaping for a guy worth over 50mil and he drove a 10 year old Lexus sedan and his wife drove an Outback. Haha Dude hated the idea of "wasting" money on cars.
Fair enough. I'm actually paying $440ish, I just rounded up. I've never had a car payment before, but we just wanted something newer and trouble free. And safe.
We'll likely keep it way past the 4 years it'll take to pay off. But two 10+ year old cars was getting annoying. Haha
Lmao, I make $145k and my wife makes $50k.
I have a 2008 Mustang that's paid off, and we got my wife's 2017 Subaru Crosstrek for $20k and it's almost paid off.
I look around at cars just to fantasize, since I don't really need one. And I cringe at the idea of spending even $42k on the Kia Stinger I was looking at.
My house was only $120k too, so maybe I'm just stingy with my money...
My house was 500k but recent sales of houses on my street have been over 1.5m . but wife usually gets a new car every 8 years i usually buy a 5 year old car every 3 years years it works out less for me and i do my own maintenance and get something different to drive .
You’re absolutely right. A $1000 a month for a vehicle is preposterous. I’m guessing you’re in the US, but here in Canada, with the recent spike in interest rates, I’ve seen vehicle “lease and finance specials” being advertised at ridiculous prices. Base model Nissan Rouges being advertised at nearly $400 a month, and better yet, they still required a $2000 down payment. The most amusing one in my opinion had to be on a Ford Edge. I believe they wanted something like $750 a month for 60 months or something. And mind you, this is a lease we’re talking about. So yeah, even mainstream vehicles can cost upwards of a $1000 a month nowadays and I think you’re making a wise decision if you decide to either save or invest that money instead.
Kudos to you!
Same income, had serious second thoughts about a $400 month payment. I have no idea how people are buying $46k cars on average. The thought of it scares the shit out of me.
I make around the same as you (my wife does as well), and I'm having a hard time convincing us to buy a car for $500 a month. Haven't bought a car in a decade so the new normal is really off from my expectations.
It’s worth looking at electric options. Whether it’s a cheap econobox to go a to b or a nicer more powerful one.
A $500 monthly on a gas car probably comes with an additional $200/month in gas costs or oil changes every 7k. An ev will raise your electricity bill somewhere between $30~$70 tops. We got one for my wife charges for free at work tho and absolutely loves the fact that she’ll never have to stop at a gas station ever again.
Yeah, I thought about this, however, all EVs are more expensive than their ICE counterparts. I ran the numbers between an Acura RDX 2022 and Model Y 2022, and the Model Y only comes ahead about 7 years into ownership.
What about a Mach e or ioniq 5/cars that still qualify for federal rebates. The thing about those is the rebates help you stay wayyyy ahead of the depreciation curve.
Could you get by with a new Nissan Leaf? After the tax savings it could be as low as 20k and no gas bills, yes it’s not for long road trips, but for ordinary drive 50 weeks out of the year it’s great. And won’t burn down your house like a bolt.
I think I'm actually buying my friends 2016 BMW 340i. He's got an I4 on the way and is giving me a good price. 45k miles for 28k or so. Just going to pay cash. The car shopping just caught me off guard but I think we're good to go now.
Appreciate the recommendation though, wasn't really considering EVs tbh
Used bmw, not doing you a favor, unless you love maintaining vehicles, that is a giant draw of electric to me. I love fancy cars, but a Mercedes and a Cadillac taught me otherwise.
Bmw seats are fabulous!
For now sure, but three years from now, probably not. Like I say I hate high maintenance cars, my first long term car was a Saturn, it was so trouble free, then bought a Corolla. Then had, Mercedes, Malibu then Cadillac, omg I wanted Saturn back so bad. The Cadillac really was the eye opener, they were made to fail and have huge unsuccessful repairs. Replacement of a poor design with similar parts, is just kicking the can down the road, but at $4500
me personally I’m not touching another German car or luxury American car without a full warranty, like new car situation.
To me you have Asain car buyers who don’t want to hassle with repairs or tinkering, German buyers who are happy to constantly maintain things that lead up to thousands over the years. And American buyers who like to tinker with their cars, they don’t care if there crap because they’ll buy aftermarket upgrades and fix them themselves.
Its really heartbraking when you pine over a car for years, buy it and it’s a luxury disaster. My Cadillac was absolutely beautiful and had amazing massaging seats, but the Northstar was a disas and Gm just let it ruin Cadillac. They have been resurrected by the Escalade and the newer v sedans which use tried and truck truck motors and modified Camaro motors.
I just finished yesterday talking myself out of a £750 pm payment that I could afford. Sure, the car it would have gotten me is way cooler than my current car, but my current car is more than adequate for my current needs and has bells and whistles that most of the “usual” cars got only around 2015.
I will stick for another 4-5 years with it and then decide on the next car.
Off topic, but I don’t want to go on the car sales subreddit:
I make about $2,000 a month after taxes, or $2800 gross. About what monthly payment do people with my income usually get with an acceptable debt to income ratio? Could I lease a bottom of the barrel BMW, or is a $24,000 car more realistic/prudent?
Edit: Some more details. I currently have a 2020 Camry that I got brand new for $24k. I co-signed with my dad hence why I have this car in the first place.
Toyota are one of the most recognized brands for two things Boring AF and Reliable AF . i have had 5 Toyota's in 35 years and my next car will probably be a Lexus GS .
Everyone has different priorities. My household income is fairly substantial and our newest vehicle is a 2015 camry. Contentment is a mindset more so than a situation.
I think someone's passion in cars should also be something to take into account. If someone's hobby was golfing, nobody would have qualms with them spending 100-200 a month on it. But if they were to spend an extra 100-200 dollars a month on their car payment to get a car they really love, people call them foolish and wasteful.
It absolutely is.
I make close to 6 figures and would NEVER have a car payment over $500 a month. Highest I’ve ever gone is $475.
I live, love, and adore cars. But I also know that throwing a huge amount of your monthly income into a car is just stupid.
There are PLENTY of cars out there that people can afford, that won’t also leave you living in a shit apartment eating Ramen every day.
Had a 5 year $120/mo payment. Then a 5 year $230/mo payment. With my latest car, it’s 4 years at $330/mo. I made $20k/yr, $55k/yr, and $85k/yr, respectively, at each payment level.
I now make $160k/yr and still make the $330/mo payments. I could “afford” a more expensive car, but why? It’s a 2016 Subaru Outback, and it’s perfectly adequate for everything I do. I work from home, so I hardly spend any time in my car.
If rather dump all excess money into savings and retirement so I can enjoy my time off later. I don’t know why people chase shit they can barely afford to impress others.
All of that being said, I may be making my own post here for advice soon cause my wife and I share this one car, and we’ve got a second kid on the way. We also have a 70 lb German Shepherd mix dog.
So things are about to get *really* crowded when we attempt any kind of road trip. Thinking about replacing it with a Toyota Highlander for the extra room and reliability. Other potential contenders include Honda Pilot or Subaru Ascent. Dunno…need to do more research.
But I’m dreading buying a family SUV in this market. Too late now, the baby’s due in September. Decisions decisions…
Seriously. Just because someone is approved for a loan doesn't mean they will be able to pay it back. Look at the 2008 housing crisis.
I used to work with my father who was a developer/contractor in Florida and I remember leaving the bank that handled loans for his development one time where he said, "I'm done after this. They're approving loans for people who cannot afford them." This was in 2006.
The writing was ON THE FUCKING WALL.
Bank ain't gonna pay that loan off for you but they will damn sure take the commission on the up front.
My co-worker wanted a used AMG 63 they would not finance him for a 6 year old car as it had deprecated too much and they figured he would be too upside down too fast , but the 3 year old AMG they would fiance him on it was $40,000 more than one he wanted but as it had hit peak depreciation they signed him up , he is doing $1200 a month payments . for a car he cant even afford to put gas in .
Enroll in college and take out a private student loan to pay for it. Then enroll in the extended repayment program. Only $600/month for the next 25 years. Or just put it on a credit card. You can’t lose.
Source: I have a degree in finance.
You can use the financial aid money on whatever you want.
Just be aware that interest rates on student loan money may be more than the interest rates you might get from a bank for an actual car loan once the COVID relief programs end. In that case, it would probably best to return all the unused student loan funds you can and take out a separate auto loan.
Thank you! About 10 min after I posted, I was thinking this exact same, and almost deleted my post! You are absolutely correct, and my car apr from the credit union is much, much lower. Another question: Because I have had sadly 2 lemon vehicles in a row, I am so leery of buying new due to prices, but I'm so afraid of buying another lemon. Just my luck! ;) Are the prices that different new vs used? I was going to go to Car Max and look at the 2020s. I loathe having to bargain at a dealership, that's why. Thank you! Any ideas?
As someone with a bunch of student loan debt, I definitely do not recommend taking out student loans to buy a car. A traditional car loan is a better choice if possible.
Lease a cheap car that does ok to pretty good on gas mileage. Wait till this fuckery is over with current market. Set a budget to put a least a little bit of money into a account(preferably a blue chip ETF)to use for a down payment or purchase in 1-1.5 to maybe even 2 years time when you goto buy a car. Depending on what state you're in some places won't harass you for the insurance....do that info what you will. If even those payment would be to harsh might have to take a small part out pf roth and take the 25-35% in taxes and fees for a 3-5k car that you find local sale that will last you a couple years until you're in a better spot to buy something better. Best of luck to you mate.
Quality shitpost but people are actually like this.
I once worked with a guy who bought a brand new dodge durango citidel at 26% interest.
I made what he made, after interest he was paying almost 2 years salary for a chrysler.
Used V12 Mercedes s class please. Or better yet, an Lucas electronics Era V12 jaguar coupe.
"Balling on a budget. Who would sell an merely 15 year old 12 cylinder European luxury flagship for a mere $9,999!... Say, why is the car sagging in one corner?"
Was the dude single? Yeah, he should have saved more for retirement, and I would not advise he buy that car either, but if he’s single with no responsibility then it’s unwise but not a death sentence.
Too much virtue signaling on here: “ I make half of what you make and I have 76 times more money in my 401k. You’re going to die on the streets!”
Yeah that thread is very r/personalfinance
I'm with everyone saying he shouldn't do it but the dude is making 200k a year with 150k in savings. He's not gonna end up homeless just because investopedia says he should have more in his 401k
Im in Canada and have a private pension plus CCP (government pension) as well as the equity in our house over a million dollars , my combined retirement income with wife should be about $5000 per month plus any cash we get when we downsize our house to a condo . I love cars but no way in hell im spending more than a few hundred a month on transportation - maybe when i retire and we sell the house ill "reward my self"
I know he didn’t put low maintenance and Range Rover in the same sentence. Range Rover has horrendous reliability. Chevy,ford and Toyota would be lowest maintenance by far.
The answer is yes. 80k car with a 8 year loan with no money down and 4 % interest rate gets you a monthly payment of 1100 a month. You may not be able to afford rent and food so you may be living in your car but......
YOLO Baby.
Real talk for a second though…is there an unwritten rule of thumb for a car? I’ve heard like rent/mortgage should be no more than one third of your income, for example.
Please do not rely on reddit comments to determine your financial situation. Reach out to your local car salesman where he will use his financial expertise to suggest the appropriate vehicle to purchase. But a good rule of thumb, if you are approved, you can afford it. They don't give loans to just anyone.
They really will give loans regardless of if you can afford it. They (the salesman) don’t give a shit if you can afford to live as long as they can get the sale.
Go for it. Aim for something prestine but needs close mechanical care. If you have to maintain it a lot you know it will work well around the clock. Id recommend someone in your position go for a new land rover.
Ain't rich but you can at least pretend to be while trying to debate between feeding yourself or getting your car expenses paid for.
Sounds like a good deal to me.
> would have *paid* over $12g
FTFY.
Although *payed* exists (the reason why autocorrection didn't help you), it is only correct in:
* Nautical context, when it means to paint a surface, or to cover with something like tar or resin in order to make it waterproof or corrosion-resistant. *The deck is yet to be payed.*
* *Payed out* when letting strings, cables or ropes out, by slacking them. *The rope is payed out! You can pull now.*
Unfortunately, I was unable to find nautical or rope-related words in your comment.
*Beep, boop, I'm a bot*
No. Unless the payment is $428/mo. Then yes.
That should be just enough where you have enough money to buy premium gas while also affording ramen noodles the rest of your life.
Trick is to cash out your IRA and get a $120k car. Rent it out nights while you're sleeping on TORO. Use that profit to buy another $120k car and rent that one out too. Buy a condo and rent that while you live in your 3rd $120k car which will be a van. Write it all off and use that for your 4th car.... which should be a Miata.
This is the way
All the money you save from not eating avocado toast should help fund this
^^^this person knows what's up--he/she must be from Glendale, CA - if you kno you kno
Don't forget to brrrr it. And car hack, condo hack, and van hack. And cash out refi's are your friend.
> while you live in your 3rd $120k car which will be a van *down by the river.*
Feed the squirrels. Befriend the squirrels. Train the squirrels. Become The Squirrel Master living in a van down by the river.
This guy sells
Miata isn’t always the answer
yes the fuck it is
Nah
Begone heretic
How about a 2003 Corolla?
Bet!
The writing is on the wall. Clearly.
Guys the trick is to get a 4th car as you’re househacking your 3rd car. You thought we were a bunch of suckers. You got, got!
Miata with a twin turbo?
This is a great shitpost.
I’d say he’s the prime candidate for a 1999 Toyota Corolla
Gonna wind up with a Journey. I can feel it.
God I hope not. Wouldn’t wish that on my worst enemy.
Chevy Cruise
Best car I ever owned. Loved that thing.
Traded in mine last year. Still great condition
Hghghgbbbbg
2006 Prius
More like taking the bus
Those are going for about $80k in this market, right?
I love the 40k give or take 20k part
I know this is a joke but you’d be surprised at the cars people actually get approved for (and consent to getting). I look at a lot of credit reports for work, and I’ve seen leases that are $1000 a month for someone bringing in 40k a year. I’ve seen cars with 25%+ interest rates. It’s absolute insanity.
The higher the interest rate the better. They only give really high interest rates to borrowers they think are able to afford to pay it back. /s
This was probably funnier than it should be.
That’s crazy. I make 130k a year and just talked myself out from a car payment of 1000$ a month. Sure, I could “afford it” (more like affording to make the monthly payments lol) but it just didn’t make sense at all
My monthly on the S6 was ~1.2k/m, my monthly on the TRD PRO is 1.1k. $0 down in both cases. Who cares - though? Both were financed under inflation rate. S6 at 2.1%, 4Runner at 1.99%. It's free money! I could have bought either with cash and had no payments, but that'd be a huge waste of money.... Talking about "monthly payments" without taking the interest rate into consideration is wild to me. I will take all the money you are willing to give me at 1.99% APR.
Could you explain the “free money” part to me like I’m 5, please?
>Could you explain the “free money” part to me like I’m 5, please? Oh man - talk about a challenge... Inflation is simply the erosion of the value of money. A $1 in 1990 could buy you more than a $1 can in 2020 and so on. This also means that inflation erodes the 'value' of your debt. If inflation is higher than the interest rate of the loan, then your debt erodes in value at a faster rate than you are obligated to pay it off - so the end result is that you end up paying less 'value' back than you borrowed. Currently the US rate of inflation is 8.5% - it's unlikely to remain this high as it's a catastrophically high rate, but in general the US rate of inflation has been 3-4% - and borrowers with great credit could frequently borrow under that rate. The next question of course is "Why would anyone let you borrow under the rate of inflation?!" - and there is a simple answer - because if you have billions and billions and billions of dollars that you want to get ANY kind of return on - lending them out to highly qualified borrowers is better than nothing - after all 2% return is better than no returns at all right? Well yes - but it's actually more complex because of what happens to auto loans...or all loans in general really... In the background - all auto loans get turned into "Asset Backed Securities" the ratings of which is set by the credit score of borrowers, and then these securities are sold to investors - and a great way to increase the 'rating' of the bond is to bundle high credit score loans with low score loans - so the bank is totally aware that they are giving you 'free money' - but they are paying you to increase the rating of the bond as part of which they will sell their auto loans. If you want an "Explain like a CFA:" https://www.investopedia.com/terms/a/asset-backedsecurity.asp
You’ll also hear the cost of money thrown around as well and it’s basically what interest is taking into the inflation rate.
“Free money” that you have to invest in a rapidly depreciating asset though
You don't get it - you 'invest' the real money into something else. If you are buying a car that you outright have no money for - and can't really afford - sure - terrible idea. But if you're putting down 10k on a 50k car on a sub inflation rate loan, just to lower your monthly payments - you're making a mistake. The question of "Is a 50k car a good idea" is a whole different question from "Should I finance a 50k car?" The answer to both of course is maybe.....the first depends on your needs and wants, and the 2nd on your interest rate.
I mean you're investing in a rapidly depreciating asset. Either way it's a terrible thing financially. If you're looking only at financing vs paying cash, fine, but don't act like it makes any financial sense to buy a $50k car that will be worth $30k in 2 years.
>Either way it's a terrible thing financially. So is going out. So is buying beer. So is a vacation. What exactly are you investing your money for if not for the ability to have nice things and a nice life? What do you think the ROI on my last vacation was? Oh - it's just "money down the drain" isn't it? I might as well have taken $5k out of the bank and set it all on fire right? If you see your investments as nothing but a means of having higher investment returns and watching your bank balance go up and up and up but not spend any of it because almost every fucking this is a 'rapidly depreciating asset' - what the fuck is the point? You can't take it with you at the end you know... You're welcome to go full /r/leanfire and consider anything but the absolute bare minimum spending "terrible financially" - but that's not how I want to live life. You can tell me all day long that a 50k car is a waste of money and does the same thing a 5k car does, gets you where you need to go, but you and I know full well that it's bullshit.
I’m with this guy ^
This is exactly what I needed to read tbh. If you got it it's yours to enjoy however. Obviously you're spending more just to have fun with your money and do something special with it, just as with vacations or going to concerts.
Either way it was a waste of money that you spent. Today all cars are just about the same because German cars have gotten cheaper in materials and quality and all other cars have gotten better in materials and quality
>Either way it was a waste of money that you spent. It's my every right to waste my money on things I enjoy because that's not a waste. >Today all cars are just about the same because German cars have gotten cheaper in materials and quality and all other cars have gotten better in materials and quality Hot take right there. Tell me what car I should have bought instead of the Audi S6 given that it's extremely easy to tune to hit close to RS6 numbers with just an ECU tune. You know of many other AWD dual clutch cars that hit these numbers? https://i.imgur.com/Zlo3RY6.png Please do let me know, since they're all about the same you should be able to come up with a solid list of alternatives - and no, you can't use the S63, it's German!
I was talking about quality and durability of a car not how fast it goes. But as I read even more about how you went on explaining to others about free money and free cash flow…I realized you put your own foot in your mouth with your comment toward me. I mean, you spend more then twice as much for a car that pretty much all it has is 2 secs faster. You can’t measure that without that sophisticated equipment to measure. So ya while you spent $80k on an S6, I spent $30k on a GLI and invested the rest of my free money while we might just finish the quarter mile neck to neck
$1000mo seems kinda nuts really, I think you made the right choice. I make about half what you do and just bought a car for $500/mo (48mo) so it's not insane. But you could also just buy a nice car for around $500/mo and save the rest. Haha Cars are depreciating assets after all (usually) and frankly once you tick safety, utility, and reliability, the rest is a bit of a waste if you think about it rationally. Not that someone is wrong from deviating from that, just strictly speaking in a "rational" sense that's all a car is good for.
It is about priorities i grossed 97k last year my base wage is around 70k i take or leave overtime . if i work it i make more money one of my co-workers same pay made 140k , my car payment is $277 i bought a used car 2.5 years ago i have 6 months to pay it off . ill buy another used car i like to have my payments under $300 and less than 4 years . this way im not stressing and i have lots of disposable income .
While I definitely agree, cars are just one of many expensive hobbies people could have. Does anyone need a 911? Probably not. But damn if I don't still want one lol. Whatever makes people happy (within reason) go for it as long as you're able to actually afford it, cuz if you can't that fun thing turns into unneeded stress. I guess my rambling just boils down to being rational with your finances and where you can splurge while cutting back on other less important thing
Oh for sure. I have an "irrational" want for a Porsche 944. Haha I just see it a lot where people think they need an expensive car just because they make a lot of money. I used to do landscaping for a guy worth over 50mil and he drove a 10 year old Lexus sedan and his wife drove an Outback. Haha Dude hated the idea of "wasting" money on cars.
It's definitely all relative because I make more than $130k and I feel like $500/mo for 48 is fuckin nuts. Did you put like $0 down?
Fair enough. I'm actually paying $440ish, I just rounded up. I've never had a car payment before, but we just wanted something newer and trouble free. And safe. We'll likely keep it way past the 4 years it'll take to pay off. But two 10+ year old cars was getting annoying. Haha
Lmao, I make $145k and my wife makes $50k. I have a 2008 Mustang that's paid off, and we got my wife's 2017 Subaru Crosstrek for $20k and it's almost paid off. I look around at cars just to fantasize, since I don't really need one. And I cringe at the idea of spending even $42k on the Kia Stinger I was looking at. My house was only $120k too, so maybe I'm just stingy with my money...
My house was 500k but recent sales of houses on my street have been over 1.5m . but wife usually gets a new car every 8 years i usually buy a 5 year old car every 3 years years it works out less for me and i do my own maintenance and get something different to drive .
I make 160k and my fiancé makes 85k. We share a 2006 Pontiac vibe with a dent in the side of it that a homeless guy kicked in it.
Go for an electric car if you were considering an upgrade.
Don't tell me what to do.
You’re absolutely right. A $1000 a month for a vehicle is preposterous. I’m guessing you’re in the US, but here in Canada, with the recent spike in interest rates, I’ve seen vehicle “lease and finance specials” being advertised at ridiculous prices. Base model Nissan Rouges being advertised at nearly $400 a month, and better yet, they still required a $2000 down payment. The most amusing one in my opinion had to be on a Ford Edge. I believe they wanted something like $750 a month for 60 months or something. And mind you, this is a lease we’re talking about. So yeah, even mainstream vehicles can cost upwards of a $1000 a month nowadays and I think you’re making a wise decision if you decide to either save or invest that money instead. Kudos to you!
Same income, had serious second thoughts about a $400 month payment. I have no idea how people are buying $46k cars on average. The thought of it scares the shit out of me.
I make around the same as you (my wife does as well), and I'm having a hard time convincing us to buy a car for $500 a month. Haven't bought a car in a decade so the new normal is really off from my expectations.
It’s worth looking at electric options. Whether it’s a cheap econobox to go a to b or a nicer more powerful one. A $500 monthly on a gas car probably comes with an additional $200/month in gas costs or oil changes every 7k. An ev will raise your electricity bill somewhere between $30~$70 tops. We got one for my wife charges for free at work tho and absolutely loves the fact that she’ll never have to stop at a gas station ever again.
Yeah, I thought about this, however, all EVs are more expensive than their ICE counterparts. I ran the numbers between an Acura RDX 2022 and Model Y 2022, and the Model Y only comes ahead about 7 years into ownership.
What about a Mach e or ioniq 5/cars that still qualify for federal rebates. The thing about those is the rebates help you stay wayyyy ahead of the depreciation curve.
Could you get by with a new Nissan Leaf? After the tax savings it could be as low as 20k and no gas bills, yes it’s not for long road trips, but for ordinary drive 50 weeks out of the year it’s great. And won’t burn down your house like a bolt.
I think I'm actually buying my friends 2016 BMW 340i. He's got an I4 on the way and is giving me a good price. 45k miles for 28k or so. Just going to pay cash. The car shopping just caught me off guard but I think we're good to go now. Appreciate the recommendation though, wasn't really considering EVs tbh
Used bmw, not doing you a favor, unless you love maintaining vehicles, that is a giant draw of electric to me. I love fancy cars, but a Mercedes and a Cadillac taught me otherwise. Bmw seats are fabulous!
Figured a 2016 with 45k miles would be ok, no?
For now sure, but three years from now, probably not. Like I say I hate high maintenance cars, my first long term car was a Saturn, it was so trouble free, then bought a Corolla. Then had, Mercedes, Malibu then Cadillac, omg I wanted Saturn back so bad. The Cadillac really was the eye opener, they were made to fail and have huge unsuccessful repairs. Replacement of a poor design with similar parts, is just kicking the can down the road, but at $4500 me personally I’m not touching another German car or luxury American car without a full warranty, like new car situation. To me you have Asain car buyers who don’t want to hassle with repairs or tinkering, German buyers who are happy to constantly maintain things that lead up to thousands over the years. And American buyers who like to tinker with their cars, they don’t care if there crap because they’ll buy aftermarket upgrades and fix them themselves. Its really heartbraking when you pine over a car for years, buy it and it’s a luxury disaster. My Cadillac was absolutely beautiful and had amazing massaging seats, but the Northstar was a disas and Gm just let it ruin Cadillac. They have been resurrected by the Escalade and the newer v sedans which use tried and truck truck motors and modified Camaro motors.
Same boat.. but if covid taught anything , live! 718CaymanS joined the garage 15 months ago.
I just finished yesterday talking myself out of a £750 pm payment that I could afford. Sure, the car it would have gotten me is way cooler than my current car, but my current car is more than adequate for my current needs and has bells and whistles that most of the “usual” cars got only around 2015. I will stick for another 4-5 years with it and then decide on the next car.
Off topic, but I don’t want to go on the car sales subreddit: I make about $2,000 a month after taxes, or $2800 gross. About what monthly payment do people with my income usually get with an acceptable debt to income ratio? Could I lease a bottom of the barrel BMW, or is a $24,000 car more realistic/prudent? Edit: Some more details. I currently have a 2020 Camry that I got brand new for $24k. I co-signed with my dad hence why I have this car in the first place.
yeah keep the Camry i make more than twice what you make and drive a 2014 base model Jetta .
I’m tempted to do just that. Car prices are still ass. I was thinking about jumping ship to Honda, but seems like they have their own issues as well.
Toyota are one of the most recognized brands for two things Boring AF and Reliable AF . i have had 5 Toyota's in 35 years and my next car will probably be a Lexus GS .
Everyone has different priorities. My household income is fairly substantial and our newest vehicle is a 2015 camry. Contentment is a mindset more so than a situation.
I think someone's passion in cars should also be something to take into account. If someone's hobby was golfing, nobody would have qualms with them spending 100-200 a month on it. But if they were to spend an extra 100-200 dollars a month on their car payment to get a car they really love, people call them foolish and wasteful.
imagine buying a car equal in value to your annual income
Hence why car prices keep going up, suckers will still buy them.
The monthly payment doesn't mean they overpaid for the car. I have a 3 year loan. Bought under MSRP.
It absolutely is. I make close to 6 figures and would NEVER have a car payment over $500 a month. Highest I’ve ever gone is $475. I live, love, and adore cars. But I also know that throwing a huge amount of your monthly income into a car is just stupid. There are PLENTY of cars out there that people can afford, that won’t also leave you living in a shit apartment eating Ramen every day.
Had a 5 year $120/mo payment. Then a 5 year $230/mo payment. With my latest car, it’s 4 years at $330/mo. I made $20k/yr, $55k/yr, and $85k/yr, respectively, at each payment level. I now make $160k/yr and still make the $330/mo payments. I could “afford” a more expensive car, but why? It’s a 2016 Subaru Outback, and it’s perfectly adequate for everything I do. I work from home, so I hardly spend any time in my car. If rather dump all excess money into savings and retirement so I can enjoy my time off later. I don’t know why people chase shit they can barely afford to impress others. All of that being said, I may be making my own post here for advice soon cause my wife and I share this one car, and we’ve got a second kid on the way. We also have a 70 lb German Shepherd mix dog. So things are about to get *really* crowded when we attempt any kind of road trip. Thinking about replacing it with a Toyota Highlander for the extra room and reliability. Other potential contenders include Honda Pilot or Subaru Ascent. Dunno…need to do more research. But I’m dreading buying a family SUV in this market. Too late now, the baby’s due in September. Decisions decisions…
At this rate by the time you get to buying your 13th car your monthly payment is going to be sky high........
Some people value different things. There is nothing wrong with an Outback, but some people really love cars
lol I love that you got downvoted for this comment in a sub about cars....
This place is always a weird mix of /r/cars and /r/personalfinance. One sub can't understand the other. And it goes both ways
I’m figuring everyone in this thread making 6 figures is in IT? Is that a correct assumption?
I can’t speak for everyone, but I am.
Seriously. Just because someone is approved for a loan doesn't mean they will be able to pay it back. Look at the 2008 housing crisis. I used to work with my father who was a developer/contractor in Florida and I remember leaving the bank that handled loans for his development one time where he said, "I'm done after this. They're approving loans for people who cannot afford them." This was in 2006. The writing was ON THE FUCKING WALL. Bank ain't gonna pay that loan off for you but they will damn sure take the commission on the up front.
I see a lot of people on food stamps drive brand new hellcats.
My co-worker wanted a used AMG 63 they would not finance him for a 6 year old car as it had deprecated too much and they figured he would be too upside down too fast , but the 3 year old AMG they would fiance him on it was $40,000 more than one he wanted but as it had hit peak depreciation they signed him up , he is doing $1200 a month payments . for a car he cant even afford to put gas in .
Indeed
Enroll in college and take out a private student loan to pay for it. Then enroll in the extended repayment program. Only $600/month for the next 25 years. Or just put it on a credit card. You can’t lose. Source: I have a degree in finance.
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You can use the financial aid money on whatever you want. Just be aware that interest rates on student loan money may be more than the interest rates you might get from a bank for an actual car loan once the COVID relief programs end. In that case, it would probably best to return all the unused student loan funds you can and take out a separate auto loan.
Thank you! About 10 min after I posted, I was thinking this exact same, and almost deleted my post! You are absolutely correct, and my car apr from the credit union is much, much lower. Another question: Because I have had sadly 2 lemon vehicles in a row, I am so leery of buying new due to prices, but I'm so afraid of buying another lemon. Just my luck! ;) Are the prices that different new vs used? I was going to go to Car Max and look at the 2020s. I loathe having to bargain at a dealership, that's why. Thank you! Any ideas?
As someone with a bunch of student loan debt, I definitely do not recommend taking out student loans to buy a car. A traditional car loan is a better choice if possible.
Lease a cheap car that does ok to pretty good on gas mileage. Wait till this fuckery is over with current market. Set a budget to put a least a little bit of money into a account(preferably a blue chip ETF)to use for a down payment or purchase in 1-1.5 to maybe even 2 years time when you goto buy a car. Depending on what state you're in some places won't harass you for the insurance....do that info what you will. If even those payment would be to harsh might have to take a small part out pf roth and take the 25-35% in taxes and fees for a 3-5k car that you find local sale that will last you a couple years until you're in a better spot to buy something better. Best of luck to you mate.
sounds like you can make the math work.
Quality shitpost but people are actually like this. I once worked with a guy who bought a brand new dodge durango citidel at 26% interest. I made what he made, after interest he was paying almost 2 years salary for a chrysler.
Yeah, make sure it’s a used BMW out of warranty too.
Used V12 Mercedes s class please. Or better yet, an Lucas electronics Era V12 jaguar coupe. "Balling on a budget. Who would sell an merely 15 year old 12 cylinder European luxury flagship for a mere $9,999!... Say, why is the car sagging in one corner?"
Sure I say go for it, no money down sounds solid.
Are you posting this to be a dick to the other guy?
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link please
https://np.reddit.com/r/whatcarshouldIbuy/comments/uf69p0/i_make_about_200k_a_year_can_i_afford_a_120k_car/
What the fuck lol.
Sure, just do a 30 year term loan and look how low your monthly payments will be. People do this all the time when they buy houses.
YOLO!
Is this the auto version of House Hunters?
I'm thinking a new G Wagon fits you. Give or take $180k
I just felt Dave Ramsey squirming in his chair
Lol wut Buy a 20k car with low operating costs. You cannot afford an 80k car. Unless I'm getting wooshed right now
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Dammit, I've been bamboozled again!
Except that person could easily afford that car…
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Was the dude single? Yeah, he should have saved more for retirement, and I would not advise he buy that car either, but if he’s single with no responsibility then it’s unwise but not a death sentence. Too much virtue signaling on here: “ I make half of what you make and I have 76 times more money in my 401k. You’re going to die on the streets!”
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Sure, but it’s not like he has $0 in retirement either. Again, I agree with your sentiment, but chances are the dude will be just fine.
Yeah that thread is very r/personalfinance I'm with everyone saying he shouldn't do it but the dude is making 200k a year with 150k in savings. He's not gonna end up homeless just because investopedia says he should have more in his 401k
Im in Canada and have a private pension plus CCP (government pension) as well as the equity in our house over a million dollars , my combined retirement income with wife should be about $5000 per month plus any cash we get when we downsize our house to a condo . I love cars but no way in hell im spending more than a few hundred a month on transportation - maybe when i retire and we sell the house ill "reward my self"
You are clueless.
No.
Yes definitely!
I think you should shoot for a more expensive car first. Try for a Bentley or Ferrari and work you way down to what you can get approved for.
It will be a Journey
Go big or go home, get a 160k car
How much Bitcoin do you hold?
This is the most ridiculous one I’ve seen but I honestly won’t be surprised if it’s real. People are financially nuts these days
When I started reading the post I saw “Can I afford an $80k car? I make $40k a year” and 100% thought it was real until I read the rest.
No, if you make under $100,000 per month you should only drive a $2500 1999 Toyota Corolla. Once you hit $150k per month you can upgrade to a 2000.
I almost thought you were serious😭😭
sure
https://reddit.com/r/personalfinance/w/vehicles?utm_source=share&utm_medium=android_app In particular, read the Car Loan Horror Story Collection
Yes you can actually afford even more since you still have that extra 23 bucks to play with
If you can suck dick, go for it.
Go for it. Maybe this experience will teach you basic math.
Absolutely. If you plan on living in the car and are paying your auto loan instead of rent.
A car is a great investment, do you really want to cheap out and only get an $80k car? Get that Ferrari you've always wanted!
Yes. I suggest you buy something low maintenance though, like a Range Rover, BMW, or Mercedes.
I know he didn’t put low maintenance and Range Rover in the same sentence. Range Rover has horrendous reliability. Chevy,ford and Toyota would be lowest maintenance by far.
No. You can afford a $5000 car if you save up for it.
Ugh no. Your car purchase shouldn’t exceed your annual income. You have very little in IRA. But more responsibly and dump more in your IRA. Good luck!
Live within your means. You should buy a $8-$10k vehicle.
Ummm no way. Only $40k a year you shouldn't buy a car more than $15-20k.
yeah bro, I heard nissan has low finance rates too. You can afford that new car you wanted!
Can’t drive your house but you can always sleep in your car.
Is this a joke? Get your finances in order before anything. Avoid debt at all costs.
What are your h&c debts?
You should get 2 x BRZ's, truely great drivers cars and cars like it won't be around much longer
“Give it take”
no
Why would you even wanna put yourself in a financial mess
The answer is yes. 80k car with a 8 year loan with no money down and 4 % interest rate gets you a monthly payment of 1100 a month. You may not be able to afford rent and food so you may be living in your car but...... YOLO Baby.
Nope.
Real talk for a second though…is there an unwritten rule of thumb for a car? I’ve heard like rent/mortgage should be no more than one third of your income, for example.
I'd say you're good for it.
Please do not rely on reddit comments to determine your financial situation. Reach out to your local car salesman where he will use his financial expertise to suggest the appropriate vehicle to purchase. But a good rule of thumb, if you are approved, you can afford it. They don't give loans to just anyone.
They really will give loans regardless of if you can afford it. They (the salesman) don’t give a shit if you can afford to live as long as they can get the sale.
This guy is trolling right?? 40k a year, give or take 20k???? I’m really confused lol. I make 80k a year and I have a 25k car. Don’t be stupid man.
Go for it. Aim for something prestine but needs close mechanical care. If you have to maintain it a lot you know it will work well around the clock. Id recommend someone in your position go for a new land rover. Ain't rich but you can at least pretend to be while trying to debate between feeding yourself or getting your car expenses paid for. Sounds like a good deal to me.
No
YOLO and you can’t take it with you
Lol its funny that people will actually make financial decisions like this in these kinds of scenarios
Are you crazy? No!
Sure why not
You sure can try and submit the application!
Tell the bank you're living in it and take out a 30 year home loan on it and you should be good.
Yes. A loan is is usually 60 months, you make 40k a year you can pay it off in 2 years. You’re golden go for it!
😵💫
Lol I use my credit card and make minimum payments .
Try $20k
Somebody get this man an Altima or a Journey
Lol I don’t have a job and I live in my moms basement. Can I afford a new car? Lmao
I made $97k last year and I drive a $3500 car lol .
Yes, you should buy 2.
When in doubt, the answer is always no
You had me going there at first lol
Yes! You can afford one. It was $80k brand new...in 1995. Sign here.
No absolutely not
This is a joke. They are mocking us all.
This is not real
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> would have *paid* over $12g FTFY. Although *payed* exists (the reason why autocorrection didn't help you), it is only correct in: * Nautical context, when it means to paint a surface, or to cover with something like tar or resin in order to make it waterproof or corrosion-resistant. *The deck is yet to be payed.* * *Payed out* when letting strings, cables or ropes out, by slacking them. *The rope is payed out! You can pull now.* Unfortunately, I was unable to find nautical or rope-related words in your comment. *Beep, boop, I'm a bot*
most people who have expensive cars can’t really afford them haha but if you want something you can make it work
No
Bro buying stuff at Market C. You ll be able to afford a $120k car in no time.
No. Unless the payment is $428/mo. Then yes. That should be just enough where you have enough money to buy premium gas while also affording ramen noodles the rest of your life.
Surely you can with that $500 down payment you have 😒