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Posted on 5/4/21 at 8:17 am to Hopeful Doc
Thanks.
I never mentioned anything about financing (we pay cash for our vehicles). But i understand the point.
I never mentioned anything about financing (we pay cash for our vehicles). But i understand the point.
Posted on 5/4/21 at 8:28 am to white perch
quote:
Also, invest in your health. Work out. Eat right. Spend money on experiences, not things
While I agree with that last part, understand that some of us use cars as part of our life experiences. My free fun time revolves around track time at VIR and Summit Point. But those experiences don’t come cheap. I don’t ski, golf or go to the beach. And I don’t have kids. For those who have families, what I’m saying doesn’t really count. I understand and that’s why your last statement is dead on.
As a side note, the only thing that prevented me from getting to Formula One and winning a WDC is my height, weight, lack of money... and lack of talent. If not for those minor factors, I’d be The Man!
I don’t know what the OP’s idea of a “nice” car is (it’s purely subjective). But if he’s not a true car guy (and he’s not in love with his local mechanic or dealership), buy a sporty Lexus, enjoy it and keep it til it begins having major issues. I promise him, it’ll outlast every Jaguar I’ve ever had.
Posted on 5/4/21 at 8:29 am to meansonny
quote:
The market value of your honda only matters if you plan on selling it.
I get the concern with value depreciation. But if you look at Hondas in terms of functional value (and you never sell), you should finish up with no regrets in terms of cost of ownership.
Ive never bought a new car and i dont plan on doing so. But there is value in 0 miles, warranty, probably better financing new, etc..
If you never sell, the depreciation is moot. Just the total cost of the vehicle and financing (along with maintenance) versus the number of miles that you get.
I get all this and I plan on driving this car for many more years, but still lower total cost of ownership if I had bought say a 3 year old Accord for $8k-$10k less than mine and it functionally would have lasted me just as long. I'm essentially still just getting hit with more depreciation over life of vehicle as the 3 year old car would have lasted essentially as long as the new on in this case.
This post was edited on 5/4/21 at 8:36 am
Posted on 5/4/21 at 8:30 am to rpg37
One of best things I did was deciding to pay cash for next car when I was younger. I had enough saved after a few years but then idea of spending that hard earned $ on wheels didnt have the same appeal. Because of that I kept driving my post college car for 10+ years. Finally bought new BMW (got a decent price stationed in Germany) and held that for another 10 years. I could afford any car at that point but went with a great deal on a 2 year old used car. It was no longer about affordability, rather the opportunity cost of not keeping $ invested.
Posted on 5/4/21 at 8:33 am to white perch
I was waiting for the douche response.
You delivered.
You delivered.
Posted on 5/4/21 at 8:43 am to thunderbird1100
quote:
get all this and I plan on driving this car for many more years, but still lower total cost of ownership if I had bought say a 3 year old Accord for $8k-$10k less than mine and it functionally would have lasted me just as long. I'm essentially still just getting hit with more depreciation over life of vehicle as the 3 year old car would have lasted essentially as long as the new on in this case.
Im not disagreeing with you that your total cost of ownership is higher by purchasing new.
But i will disagree that a 3 year old car will last just as long as a new car. By literal definition, it will last 3 years shorter. Same math applies if purchased at 30,000 miles on the used vehicle (it literally cant last as long as a new vehicle because you will not benefit from the first 30,000 miles).
I wouldnt beat yourself up over it is my point. I dont think you are losing as much in the transaction as you believe you are.
Posted on 5/4/21 at 8:49 am to rpg37
Since my savings are front-loaded and at a comfortable rate (say 20-30%), I would take a look at my budget, and back-calculate average excess cash flow into a loan amount that feels comfortable to me:
Say you have $700 extra per month, that equates to a 60-mo, 0%, $42,000 loan. I just use Google's auto loan calculator function
Then however much you want to put down = car you can afford. Obviously YMMV
Also I know you didn't ask for car recs, but those new Genesis GV80's look nice as hell and start at under $50k:
Say you have $700 extra per month, that equates to a 60-mo, 0%, $42,000 loan. I just use Google's auto loan calculator function
Then however much you want to put down = car you can afford. Obviously YMMV
Also I know you didn't ask for car recs, but those new Genesis GV80's look nice as hell and start at under $50k:
Posted on 5/4/21 at 8:56 am to rpg37
If you can light the money on fire and it doesn't hurt your financial standing, buy it.
Posted on 5/4/21 at 9:02 am to rpg37
There is no such formula to follow, only ideology someone throws out there that makes somebody feel good about their decisions. Your emotional comfort level with this purchase is yours alone. (Ex. If everyone followed the advice of only buying used cars, where will the inventory come from if no one bought the car new to begin?)
Do you own businesses that allow for tax and depreciation deductions-- owning rental properties could give you a business writeoff? Certain weighted vehicles have tax benefits.
Obviously, your budget must be included in your decision making process. If you have disposable income, dispose as you think wise.
The only advice I can offer to a complete stranger, with the limited info you give is to stay within your financial comfort zone with any purchase.
Do you own businesses that allow for tax and depreciation deductions-- owning rental properties could give you a business writeoff? Certain weighted vehicles have tax benefits.
Obviously, your budget must be included in your decision making process. If you have disposable income, dispose as you think wise.
The only advice I can offer to a complete stranger, with the limited info you give is to stay within your financial comfort zone with any purchase.
Posted on 5/4/21 at 9:46 am to rpg37
A good rule of thumb I like is three months income for cars. For $100k Thats $25K. If your married and let’s say she makes $50k. That’s $12500. So that’s 37,500 total for cars.
Posted on 5/4/21 at 9:59 am to meansonny
quote:
I wouldnt beat yourself up over it is my point. I dont think you are losing as much in the transaction as you believe you are.
It's more so the more money up front that could have been invested otherwise is where I'm losing the most.
Buy $15k car vs. $25k, pay it off in either same amount of time = more money each month to invest with lower car payment...or pay it off 2 years sooner than $25k car = a lot more money in those 2 years to invest vs. $25k car.
Now the discipline there is actually investing the money and not blowing it on something else, but I've now been operating in an environment where pretty much all excess money is invested vs. sitting in checking/savings account or just spent on something else. I get thats the problem the majority of people have. Not having a car payment though, certainly feels great.
I also certainly wont drive this car till the wheels fall off, probably a few more years, maybe own it 10 total years or so, then move on to something else.
My first Accord lasted 286k miles before transmission needed replacement, my Acura RL I had hit 184k before some power features (seats, steering wheel) started to go. I dont think I'll make it anywhere close with this Accord before getting the itch to get rid of it. It has only 77k miles on it (2014).
This post was edited on 5/4/21 at 10:06 am
Posted on 5/4/21 at 10:13 am to Woodbird
Damn I guess women teachers don’t listen to that rule of thumb. Some are driving around in a 70k suv making 33 k before taxes
Posted on 5/4/21 at 10:23 am to rpg37
I wouldn't buy a nice car right now. Crypto is running and cars are in demand. JMO
Posted on 5/4/21 at 11:03 am to rpg37
I don't.
A car is something to get from point A to point B for me.
The things I consider is
Price
Safety
Functionality
I don't view a car purchase any different than I value a jar of peanut butter.
I am not saying this is the case for you, but most people in their teens/20s/30s are sacrificing serious wealth building in exchange for a cool car that loses 50% of its value after 5 years.
A car is something to get from point A to point B for me.
The things I consider is
Price
Safety
Functionality
I don't view a car purchase any different than I value a jar of peanut butter.
I am not saying this is the case for you, but most people in their teens/20s/30s are sacrificing serious wealth building in exchange for a cool car that loses 50% of its value after 5 years.
Posted on 5/4/21 at 11:04 am to rpg37
One I can pay cash for
Posted on 5/4/21 at 11:10 am to rpg37
Seriously if you are saving for retirement then buy whatever the heck you think you want. If you change your mind, get rid of it. I've had buyers remorse over every vehicle I've ever owned... some because it was a cheap POS and I should've bought something nicer and then also damn this $800 monthly payment sucks balls
Posted on 5/4/21 at 11:23 am to rpg37
(How big are the truck nuts x10 + how high is it lifted x 10 + how loud is the exhaust x10) x 1.5 if diesel with a 5 point bonus for a front winch. Finance it out for 84 months. Adjust all other bills/debts to accommodate truck and pull from savings and emergency fund as needed.
Posted on 5/4/21 at 11:47 am to thunderbird1100
Agreed.
My biggest financial blunder was a car purchase. My vehicle was totaled in an accident.
I saw a honda for $13k, but only had $10k cash on hand. So i bought a comparable year/mileage dodge intrepid for $10k. Within 2 years, it was worth $2k. And for good reason (so many problems). I had it for 5 years and was still able to get just under $2k as a trade. But if i spent $3k more... i would have been in a honda (and i do drive my cars until the wheels fall off).
I paid $13k at 33,000 miles for my current veh (2007 honda accord). Ive had it 11 years and 165,000 extra miles.
Im pretty fortunate to claim that my biggest investment mistake was a $10k vehicle. But my mistake was backwards from yours (too cheap on the purchase and regretted not financing that $3k).
My biggest financial blunder was a car purchase. My vehicle was totaled in an accident.
I saw a honda for $13k, but only had $10k cash on hand. So i bought a comparable year/mileage dodge intrepid for $10k. Within 2 years, it was worth $2k. And for good reason (so many problems). I had it for 5 years and was still able to get just under $2k as a trade. But if i spent $3k more... i would have been in a honda (and i do drive my cars until the wheels fall off).
I paid $13k at 33,000 miles for my current veh (2007 honda accord). Ive had it 11 years and 165,000 extra miles.
Im pretty fortunate to claim that my biggest investment mistake was a $10k vehicle. But my mistake was backwards from yours (too cheap on the purchase and regretted not financing that $3k).
This post was edited on 5/4/21 at 11:49 am
Posted on 5/4/21 at 12:06 pm to rpg37
Go ahead and get the nice car now so it’s out of your system. Once you have it or the ability to have it you realize it’s not all that. It’s like the rich people you see that wear Levi’s and t-shirts vs very expensive named brand clothes that less fortunate people buy to try and look well off. Once the new wears off you’ll realize the money could have been invested.
Full disclosure, I have a very expensive truck that my business pays for. I’m on the back side of my comments above which is why I say go for it. Only way to really learn in life is by doing.
Full disclosure, I have a very expensive truck that my business pays for. I’m on the back side of my comments above which is why I say go for it. Only way to really learn in life is by doing.
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