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Our net is around $120k and we have three cars: my used beater, a Ford (lease, $349) and a Jeep (bought, $479). The Ford will go back and not be replaced in exactly a year. The Jeep has 3 years left on a 4 year loan. When that is paid off, I plan to buy a Mustang that I will keep forever!
The key to saving money on a vehicle is being willing and able to work on it yourself. If you cant/won't do that, you're going to spend a lot more money.
When and where I grew up, it was the norm for a man to do basic auto repairs and maintenance. Even shade-tree engine rebuilds were common. But these days people would rather spend their time on the internet, complaining that repairs cost too much
Cars were simpler and easier to work on back then.
Our monthly gross income is 20k and car payments are 1000 with 500.00 coming back from employer reimbursement on a non taxable basis. I’ll go by gross as it’s a better measure because we have 4-5k a month going into retirement plans it skewing the net
The key to saving money on a vehicle is being willing and able to work on it yourself. If you cant/won't do that, you're going to spend a lot more money.
When and where I grew up, it was the norm for a man to do basic auto repairs and maintenance. Even shade-tree engine rebuilds were common. But these days people would rather spend their time on the internet, complaining that repairs cost too much
There’s no need for that. I don’t keep cars long enough to worry about how much an engine replacement cost.
By the time it’s out of power train warranty I’ll be bored with it anyway.
Location: We_tside PNW (Columbia Gorge) / CO / SA TX / Thailand
34,690 posts, read 58,004,579 times
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Quote:
Originally Posted by TRlaura
... This is my 5th car since turning 16 and have never had a car payment. I never plan to.
^^^^^^^^^^^
same... I had 7 cars BEFORE turning age 16 (countless motorcycles... = similar for most farm kids)
Never saw the need / benefit for car payments...
Current car = ~0.001% of my NW (no payment required or desired) (i.e. take the value of your car and multiply it times 100,000* = your equivalent net worth)
Cost per mile <$0.04/ mile inclusive of the cost of the car, fuel, insurance, maint... (as it has been for over 40 yrs of driving)
hint: some of us go to great extremes to avoid working for a living... the sooner the better! (More time to DRIVE... I enjoy driving )
$75-80k net before bonus. Drive a Hyundai paid cash for $17k 2 years ago. But am considering leasing sport sedan for $400-500 per month. HAd a Z06 corvette but sold it after 12 months due to biting off more than I can chew with the power, maintenance etc. ended up eating $11k which isn't that terrible due to the car. I've seen leases for Z06's go for $1500/mo. It's actually a good thing I sold it because I only get one parking spot with my new apartment.
I only want new cars from now on especially if it's going to be sport oriented. You never know what previous owner did. I don't see the stigma having a payment. if I bought a car $30k cash kept for 10 years, then add maintenance, repairs, tires, brakes... car will be worth under $5k in 10 years. you will probably be paying over $300 a month anyway, but you are doing it all at once. I just don't know cars well enough to maintain something old and unknown myself and don't want a cheap appliance.
I had a Nissan Versa that I paid $3k for which I learned stick on. While it was fairly reliable the AC compressor crapped out and the car started smoking. along with other issues, I probably paid $200/month to own that car for 2 years after selling for $1200 if you include the insurance payment after getting rear ended. I'll pay a couple hundred more to own something new and nice...
If I’m reading that right, it sounds like you’re trying to dispose of cash and not earn it right?
Simple math for growing cash.
Buy a $20k car with cash and save the financing charge of 3% over a 72 month loan. That’s saves you $1878 over 6 years ($26 a month).
Or you can finance that $20k car and invest the $20k in cash you now have in the S&P who’s rate of return is 9.8% (buy we’ll be conservative and say 7%) and have $27,231 in 6 years.
So paying off the car early actually cost you $5353 ($74 a month). Spending $74 to save $26 is nothing to be proud of.
When people proudly claim they paid cash for their car and never had a car payment, it makes me worry about our education system. Those people are fighting an uphill battle and don’t even know it.
Using your calculation financing my car.
$90K for 72 months @ 3% = $1367 – Interest $8,455.
My projected growth @ 7% for the next 10 years is almost $2mil. This is by just sitting on my a#s. What you don’t understand is that the government requires me to take out about 4% annually from my IRA.
I have cash available in my checking account to pay cash for cars and such.
Yes occasionally I take $100K and put it back in the market but not as an IRA.
car 1 - $1K payment
car 2 - $1K payment
car 3 - $2K payment
I love cars, and yes I can afford it.
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(as it has been for over 40 yrs of driving)
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