re: Is buying a $24k car on $50k salary dumb?

First thing that breaks you'll wish you'd bought a brand spanking new Accord/Camry/Sonata/Optima type vehicle.

For your salary, I could justify cars mentioned above since warranty will cover any issues while salary increases. Plus one of these will have a 0.9-1.9 financing over 4-5 years which is essentially free money factoring in inflation for most of the life of the loan. You'll get 100-150k miles with oil changes every 4-5k on any one of these vehicles.

Be smart

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that amount should be fine. Your note will be around $375 a month, which is not bad for your income at all.

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If zero down and five year car he would be lucky to grab a 4% loan which puts him around 425 over 60

Fiance drives an 2011 IS250 and I drive a Sonata (formerly Cadillac CTS)

While the GF would never admit it, she is jealous of all the "standard" Sonata features as she asks to drive it all the time. One package level up got me standard rearview camera, touchscreen, onstar bluetooth and more + overall it is a great looking car.



I came from a family in which both parents drive german luxury cars, my first car was a few YO CTS and my sister drives a X3. I promise you that in my neighborhood, nobody judges the doctor next door who drives a Camry. I found out the only people who care about what type of car you drive are those who can't afford one and those that are insecure about their social status. My parents drove nice cars because they could afford luxury, not because they cared what the brand name was on the car.

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I've read some websites that say don't spend more than 20% of your annual salary on a vehicle

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I don't think this is reffering to the total cost of the vehicle, just the yearly portion of the financing.

That would reccomend that someone making 100k spend 20k on a new car

People are looking at this the wrong way IMO. You should be saving money FIRST then having income for everything else. As long as this isn't changing your savings plan(assuming you have one) then I think its fine.

Maybe he's a car guy and he rather take 75 out of his fun money every month and drive a nicer car.

There is so much fail in this thread. Buying a car that is half the value of your annual salary is fricking dumb.

The thought of paying a car note, any car note, hurts the hell out of me. That said, I'll probably get one soon, but I'm going to buy a used car even though I can afford really nice one. The only way I can justify it is that I have driven a 1997 truck for the past 7 years.

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Why? It may be dumb to you but you cant just say that. Too many other factors go into it.

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Seriously if he has no kids, isn't hampered by a massive mortgage or debt, why the hell not? That still would leave him plenty of money to save, spend etc.

Builds credit and 24k isn't outrageous. Spread that out over 3-5 years on low interest, its not that crazy at all.

Spend however much you want--that's not the issue. But you could buy a brand new VW Golf (motortrend car of the year for 2015) for less than you're planning to spend on the A5. Way too much money for a 5 year old car; with VW/Audi, you're not getting that much upgrade in materials, fit/finish when you step up to Audi, IMHO. I just bought a 2015 Golf TDI for less than what you plan to pay for used; 55 mpg highway, 40-45 in the city. Gonna drive that sucker into the ground; passed my 11 y-o Volvo down to my hubs, who will drive it at least another 2 years before he caves and buys a new car (prob another Volvo or an Audi q3 TDI w very low miles). We find that buying new or barely used represents best value for our household as we like to keep the same cars as long as possible.

I'd rather go to Europe every year than drive a luxury car. But we all make our own calibrated choices.

25k brand new on 50k isn't that bad at all

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Lets say you do that and change cars every 5 years, beginning at age 25 - if you'd invested that $75 a month, instead of wasting it on a car note you absolutely could have avoided - at age 65, that's about $150k (assuming 6% yield on the invested money for 40 years).

Is $150k that big of a difference in your retirement package at age 65? Will that be the difference in being able to retire at 65 or working until 70 or beyond?

You tell me.

(And decisions like this compound - the same can be said for the guy who buys a Starbucks latte 4 times a week, etc. - about the same amount of money. If he was brewing his own coffee for a fraction of that, etc.)

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This board, gotta love it