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my philosophy in car buying... buy the cheapest, most reliable, safest vehicle you can afford to pay FULL CASH for. For some people that will be a 10 year old Toyota Corolla, for others it will be a brand new Mercedes or Lexus. Financing cars should only be a last resort if you absolutely have no other options and need transport to get to work.
Of course most people in the US will think I am crazy but that is what is wrong with most people in the United States, they are broke, to their debt in eyeballs and buying expensive assets they cannot afford that are rapidly depreciating in value.
Payments are relative to income. If you make $150,000 a year, a $1,000 a month car payment isn't that big a deal.
I still wouldn't want one that high. My G/F and I combined make a very high income and I cringe at the thought of a payment over $200-300/month for a term over 4-5 years.
Last edited by BostonMike7; 04-24-2015 at 12:03 PM..
You all make me feel better about having a car payment again after many years. I have a 2014 Kia and i'm paying $250 a month. $1000k a month is more than my mortgage but if you got it and that's what you want, it's all good.
I still wouldn't want one that high. My G/F and I combined make a very high income and I cringe at the thought of a payment over $200-300/month for a term over 4-5 years.
It's entirely a comfort level thing. I don't have an issue with a $1,000 a month payment for a car I truly enjoy.
It's entirely a comfort level thing. I don't have an issue with a $1,000 a month payment for a car I truly enjoy.
I understand completely. If that's what you are comfortable spending and can do so, then it shouldn't be a big deal unless you manage money poorly.
My G/F thinks of cars as nothing more than an appliance on wheels, so she drives an accord for $2xx/month and that's all she wants.
I'm addicted to golf trips, firearms, my classic mustang, giant salt-water aquariums and rare coins, so i'll drive my 9 year old car for a little while longer.
150,000 isn't living large with a family. We live in a nice family area. Most people drive Hondas. Pilots and Odysseys are everywhere. If someone has a luxury car for the most part they are either making well above 150K of they bought something used for the price of a new Honda.
I can see it go up to 4 but 5 or 6 years is crazy. Even 4 years seems like an eternity.
If you don't change cars often, and the car is reliable, 5-6 year loans shouldn't be too crazy. Long indeed, but there are incentives. I've already had my car for 4 years, feels like its only been 2. But then again, it doesn't have monthly payments.
Now for the OP's question, the average monthly payment is like $450.
Bought my first car cash at 16 with fast food and other part-time money (which I walked or biked to and had been working since 14). Used beater, but it got to the places I needed to go, including a 2nd job farther away from home.
Bought my 2nd car cash with basic training + AIT + Airborne school money. Pretty easy to do considering there wasn't much to spend it on for those 6 months and still had plenty left over.
Bought my 3rd car with cash. Pretty easy to do when you haven't been forking over car payments for a decade (and you don't blow those savings elsewhere).
Some people are just financially stupid and there isn't much anyone else can do for them. You have to WANT to be financially better off, but some people choose to whine and complain without even examining their own habits. One can't always control what they're bringing in, but everyone can sure as hell control what they're shelling out.
Shouldn't the car purchase be considered in terms of overall cost, not the monthly payment ? The monthly payment says nothing.
Quote:
Originally Posted by k374
my philosophy in car buying... buy the cheapest, most reliable, safest vehicle you can afford to pay FULL CASH for. For some people that will be a 10 year old Toyota Corolla, for others it will be a brand new Mercedes or Lexus. Financing cars should only be a last resort if you absolutely have no other options and need transport to get to work.
Of course most people in the US will think I am crazy but that is what is wrong with most people in the United States, they are broke, to their debt in eyeballs and buying expensive assets they cannot afford that are rapidly depreciating in value.
It does not make sense to put down $20-30k in cash as you'd be depleting your emergency reserves. Unless you're either really wealthy, or buying a really cheap car. You need to keep 6 mos to a year worth of take home pay in the bank account or some other readily accessible form, and for anything over that amount it probably makes more sense to invest more in your 401k than to put it in a car.
I'd rather pay a grand or two in interest on a car I lease or buy while keeping that money in the bank or invested. In the end this buys me better financial flexibility.
I do agree, wholeheartedly, that people should only buy what they can afford.
Shouldn't the car purchase be considered in terms of overall cost, not the monthly payment ? The monthly payment says nothing.
It does not make sense to put down $20-30k in cash as you'd be depleting your emergency reserves. Unless you're either really wealthy, or buying a really cheap car. You need to keep 6 mos to a year worth of take home pay in the bank account or some other readily accessible form, and for anything over that amount it probably makes more sense to invest more in your 401k than to put it in a car.
I'd rather pay a grand or two in interest on a car I lease or buy while keeping that money in the bank or invested. In the end this buys me better financial flexibility.
I do agree, wholeheartedly, that people should only buy what they can afford.
This depends on a lot of factors but IF you can afford to pay cash for it and STILL have healthy retirement and emergency funds...why not? It may or may not make sense depending on the rate and on the alternatives with the money.
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I have a 2014 Kia and i'm paying $250 a month. $1000k a month is more than my mortgage but if you got it and that's what you want, it's all good.
