The 1/10th Rule For Car Buying

[ayau]

Originally Posted by King Tut

Yeah because you would have to make $300k to most likely have $30k to drop the cash to buy a car and not finance it. He is correct in that it makes best financial sense to pay cash for a car, but that is also true of the housing market. This article also isn't written for the automotive enthusiast who gets more enjoyment out of a car than just getting from point A to point B. It is like a hobby to us so we are willing to spend more of our income on it.

I skimmed around his site and he did make reference about being an automotive enthusiast. He used to flip cars pretty often. His cure was to go to a dealership and test drive the cars he wanted to have. That would be enough to satisfy his craving for a new car.

[King Tut]

Originally Posted by OrbitalEllipses

False. My dad's LS460 was bought outright and he does not make $300K. It's just a matter of having liquidity.

Cool story bro. I have bought multiple new cars outright as well while never making $300k. There are obviously other ways of saving and making money.

[OrbitalEllipses]

Originally Posted by ayau

I skimmed around his site and he did make reference about being an automotive enthusiast. He used to flip cars pretty often. His cure was to go to a dealership and test drive the cars he wanted to have. That would be enough to satisfy his craving for a new car.

He must pull up in something nice to get test drives of exotics then.

Originally Posted by King Tut

Cool story bro. I have bought multiple new cars outright as well while never making $300k. There are obviously other ways of saving and making money.

That was the point, Tutstein.

[BRZZZZZZZZZZ]

I go by the 40%/30% rule myself personally, never spend more than 40% of your gross yearly income on a car, as well as always have at least 30% downpayment.

That's pretty comfortable for me.

[King Tut]

Originally Posted by ayau

I skimmed around his site and he did make reference about being an automotive enthusiast. He used to flip cars pretty often. His cure was to go to a dealership and test drive the cars he wanted to have. That would be enough to satisfy his craving for a new car.

Flipping older and cheaper used cars is not my idea of an enthusiast. Just my idea of an entrepreneur.

[King Tut]

Originally Posted by OrbitalEllipses

He must pull up in something nice to get test drives of exotics then.

I have found that what you pull up in makes very little difference. It is the way you present yourself.

[ayau]

Originally Posted by OrbitalEllipses

He must pull up in something nice to get test drives of exotics then.



That was the point, Tutstein.

Probably testing driving cars within reason, e.g., M3, Cayman, etc. I've never been turned down for a test drive, but I also haven't asked to test drive a 911.

[gramicci101]

Originally Posted by ayau

His cure was to go to a dealership and test drive the cars he wanted to have. That would be enough to satisfy his craving for a new car.

I don't have cravings for new cars; I have cravings for fun cars. And if a simple test drive is all it takes to satisfy his craving, he's not an enthusiast.

Originally Posted by King Tut

Flipping older and cheaper used cars is not my idea of an enthusiast. Just my idea of an entrepreneur.

You don't want to restore a Nissan Sentra and try to sell it to a guy making $70K/year? What kind of enthusiast are you??

Originally Posted by ayau

Probably testing driving cars within reason, e.g., M3, Cayman, etc. I've never been turned down for a test drive, but I also haven't asked to test drive a 911.

You should; they're awesome. Even if you can't talk your way into a TTS, a simple 4 or 4S is still a blast.

[King Tut]

Originally Posted by ayau

I've never been turned down for a test drive, but I also haven't asked to test drive a 911.

Don't lift bro.

[King Tut]

Originally Posted by gramicci101

You don't want to restore a Nissan Sentra and try to sell it to a guy making $70K/year? What kind of enthusiast are you??

But I could be on a Texas show on TV.

[suaveflooder]

I love how money threads always get people crazy. This whole "life is too short not to enjoy it" arguement is a joke. Live below your means, save, invest, prepare, THEN you will prosper, be set up for now and future, and will be able to buy that pretty toy without having to worry about the 1/10 rule.

IMHO there are too many young people fresh out of college, buying a new car because "they deserve it" and "YOLO." But these are the same people who won't invest in life insurance, or disability insurance because "I'm young and I don't need it," or "I'm perfectly healthy." It's rather ironic.

They are better off buying a cheap used car, establishing themselves, paying off their debt/loans, establishing a retirement plan (roths, 401k's etc), protecting themselves (insurance), and buying themselves their prettty new car later. Chances are you are going to live a decent amount…there will be time for the fun stuff later. Do it backwards and you get the joy of working for the rest of your life to pay for stuff you bought back in your 20's…..but hey, at least you had fun, right?

[OrbitalEllipses]

Originally Posted by King Tut

I have found that what you pull up in makes very little difference. It is the way you present yourself.

That's a part of it as well. If I'm going for a test drive of a luxury/premium marque, I try to dress in my work clothes so I blend in with their typical consumer; whereas I would normally look like a post-college thug.

Originally Posted by ayau

Probably testing driving cars within reason, e.g., M3, Cayman, etc. I've never been turned down for a test drive, but I also haven't asked to test drive a 911.

For Corvettes, M3/5, 911....I'm asking my dad to come along because he's their target market.

[King Tut]

Originally Posted by suaveflooder

I love how money threads always get people crazy. This whole "life is too short not to enjoy it" arguement is a joke. Live below your means, save, invest, prepare, THEN you will prosper, be set up for now and future, and will be able to buy that pretty toy without having to worry about the 1/10 rule.

IMHO there are too many young people fresh out of college, buying a new car because "they deserve it" and "YOLO." But these are the same people who won't invest in life insurance, or disability insurance because "I'm young and I don't need it," or "I'm perfectly healthy." It's rather ironic.

They are better off buying a cheap used car, establishing themselves, paying off their debt/loans, establishing a retirement plan (roths, 401k's etc), protecting themselves (insurance), and buying themselves their prettty new car later. Chances are you are going to live a decent amount…there will be time for the fun stuff later. Do it backwards and you get the joy of working for the rest of your life to pay for stuff you bought back in your 20's…..but hey, at least you had fun, right?

But doing Formula D in my FR-S when I am 70 years old won't exactly work out for me.

[King Tut]

Originally Posted by OrbitalEllipses

That's a part of it as well. If I'm going for a test drive of a luxury/premium marque, I try to dress in my work clothes so I blend in with their typical consumer; whereas I would normally look like a post-college thug.

I wouldn't even say clothes make that big of a difference. I often show up in shorts and a tshirt on a Saturday in a buddy's cheaper car to go on test drives. It is kind of a hobby me and a couple buddies have. The type of salesman you are dealing with will make a huge difference as well. Some are enthusiasts and you can speak to them as such. Some only see sales, and you can speak to them as such.