Can I afford the FRS/BRZ? Please help me decide.

[mush]

Originally Posted by KSC

How is that a red flag? It doesn't sound like she's bleeding him dry?

Seriously, I don't mean to be a ****, (okay, sometimes I totally mean to), but some of the shit on this forum is friggen weird. Clear bras, Opticoat, garages. Do you hire gorillas to watch over the car while you go shopping at the mall?! You realize those very same "assholes" could be out and about, too, right? They have to get their t-shirts from A&F sometime, you know!

LOL yea, lotta paranoid people and the sad thing is after all that trouble of keeping the car spotless someone backs into their car because its too shiney (all those bad luck threads)
i like how that other guy comes in and bashes ur saturn really? thats just sad

i say put money aside every month, about 400-500 for 6 months to a year. see how that works out for u, if u could make it without any problems then get the car. keep the money u saved in the bank for the rainy day

[Tucson FR-S]

I'm really impressed with the sense and wisdom of many of these responses (on both sides of the issue). I'd add two points. First, it's not just whether you can afford it, but how you value what you'd otherwise spend the money on. For example, if you want to buy a house as soon as possible (and not everyone does) and that's more important, don't buy the car. Second, if you're serious enough about living with a significant other, this is a decision you should be making with them, even if the money and car are yours.

[bucket]

Originally Posted by mrybczyn

i would never pay more for a car than 6 months of net pay. so 12k for you.
keep the acura. scratch the sports car itch with a nice used miata or something in the 5k range. leave the new cars for us fat old rich guys

in a few years, you'll be fat and old and buying the 2nd gen frs.

I actually haven't ever heard it expressed that way, but it turns out that was pretty close to what I did...a lot easier to remember though

[bucket]

.02
Think about what you will need for when you are not working...when do you want to stop working? 65? How long do you think you'll live? 80? 85?....go with 85. You're going to need 20 years worth of money then....how much a year though, how about $60k? Medical needs, world travel, place in Florida with friendly neighbors. So right now, that's going to be $1,200,000 in today's money. Over a long time, inflation is around 3%, so in 35 years, today's $1.2 mil will be $3,914,445.

Starting with $5k, and using the historical 7% S&P 500 index gain for investment returns, you'll need to save $1725/mo.

How much is that $500 car payment worth in 40 years in such an index fund? $7487

...and the same argument goes out to everybody who says to always pay cash for a car. Since May of last year, the S&P 500 has gained 10.88%...car loans are like 2-3% with good credit. With $32k in an index fund you would already have enough gains for some wheels and brakes.

Most financial advice tries to maximize gains at the old end of the spectrum, and most Americans seem to maximize gains at the now end of the spectrum. Everybody who writes a book or gets on TV telling you to maximize gains at the old end of the spectrum most likely already has an 8+ figure net worth. They didn't get there by following the advice they are giving you. They took more risk than that (or they started out with/married money). It's possible to live well in the present without sacrificing your retirement. You can take into account that what you make now will probably be one of the lowest salaries you will ever have, and up until you are in your 30s there will still be time to catch up.

TL;DR...don't buy the car now, but don't wait around until you can pay cash or have x months living expenses either.

Also, maybe start looking for another job. Just going by the degrees that you have, you should be making at least 75% more than you are now. Don't become a boiled frog.

Personally, I figure out how much I need for fulfilling everything I have to pay for in a month, add in a healthy food/entertainment budget, use two net paychecks as my figure for "monthly pay", and target $1k leftover for saving/investing/paying debt/hookers. During a 3 paycheck month, dump like 80% of that straight into savings.
It could be awhile before you can afford a new car with that calculation, but you'll still be young enough to enjoy it and not living paycheck to paycheck in the interim.

[jmaryt]

Originally Posted by Efferalgan

Focus on the income part of your P&L - change employer / move to other city/state/country if needed / work more/harder and then think about buying expensive toys I would not buy a car (any car, even much more practical one) which cost more than 1/2 of your net annual income. Unless it is the ulitmate dream of your entire life.

cars are NOT worth getting your panties all in a twist,and ruining your financial
life,cuz remember!..in the final analysis, they are designed to get you from point a to point b period..seriously,if you lose sight of this fact,then you WILL
have a very expensive trip in life..been there, done that, hence,the civic...just sayin'

[jmaryt]

Originally Posted by Efferalgan

Focus on the income part of your P&L - change employer / move to other city/state/country if needed / work more/harder and then think about buying expensive toys I would not buy a car (any car, even much more practical one) which cost more than 1/2 of your net annual income. Unless it is the ulitmate dream of your entire life.

Originally Posted by bdub85

My 401k isn't all stocks.... It's called diversification. Also, it's all about time in market. I'm not cashing out my 401k anytime soon.

not to mention the fact,that if you do,you will get the shit kicked out of ya in taxes,UNLESS ya can "draw" down the money in smaller amounts,say over 3,or 4 years to KEEP ya in a "lower" tax bracket..just thought i would throw that out there.

[jmaryt]

Originally Posted by whtchocla7e

Live today, tomorrow worry about tomorrow

sound logic! live today,and "forget" tomorrow! this way,won't have to be concerned about a bread line,you WILL be in one every day!..just sayin'

[m.wood0213]

Absolutely! look for a cheap loan with a credit union or your bank, because dealerships SUCK!!! Also, take your time and wait for the BRZ (if you order) well worth it. Insurance cheaper than FRS even though its more expensive and more rare. Subie has a better rep w/ safety thats for sure. Plus if you decide to sell, you'll get more $$$ because there are very few.

[jmaryt]

Originally Posted by whtchocla7e

Live today, tomorrow worry about tomorrow

Originally Posted by Dadhawk

It can be argued it semantics, but as mentioned above by a couple, if you can't write a check for the car right now, you can't afford it. You've already answered your own question in that case.

What you are really asking is can you afford a car loan. That's a question only you can answer. If you were my son, I would tell you no, mainly because if you lost your job tomorrow you can't pay the car off (back to can I afford the car) and you don't have a significant enough savings to get through 6 months of living expenses, including the car payment.

I never buy a car I can't pay off tomorrow, even if I use the bank's money in the interim. That means sometimes I drive junk because of poor planning.

I've posted this before but its worth a watch since since you are asking.

this is ''dead nuts" accurate! listen up! pearls of wisdom!..be very careful when f**king around with cars! too expensive these days,IF you do NOT know what you are doing!
in addendum: the video doesn't even mention the fact that you get "ZERO" tax deduction for your $475.00 car payment over the course of the year. this was taken away
in 1986 when reagan reformed the tax code.

[kilrb]

Originally Posted by silverlegacy

This... invest the 25k in something to get some return... even if it is a crappy CD. Then pay off the car over time. Unless you get a cheap car, or one you can't get a loan on, never pay full cash for a vehicle if you care about being smart with your money.

Question: Why would you borrow $25,000 at 2.9% so that you can buy a CD at 1.25%? If your answer is liquidity, I can understand. If you are saying you're getting ahead by borrowing at a higher rate than the rate of return you can get on your cash, I'm interested in hearing the logic...

[LeeMaster]

Originally Posted by kilrb

Question: Why would you borrow $25,000 at 2.9% so that you can buy a CD at 1.25%?

Edumacate me.

[shawnperolis]

lawlz at everyone freaking out about car loans. Taking out a loan on a brand new car isn't the end of the world.

[bakerr6]

Originally Posted by kilrb

Question: Why would you borrow $25,000 at 2.9% so that you can buy a CD at 1.25%? If your answer is liquidity, I can understand. If you are saying you're getting ahead by borrowing at a higher rate than the rate of return you can get on your cash, I'm interested in hearing the logic...

First tell me where you can get a cd rate that high haha. i think in order to do that and still have the possibility of it being liquid would be to strecth it out about 5 years through a broker dealer.

I agree though, I would rather finance a car for below what the average inflation price is and sit on my cash (invest it) versus paying cash for it. The value of a dollar folds over time and so you would be paying less in the long run.

[zaptorque]

Originally Posted by LeeMaster

#7 is the red flag and it all depends on what type of person he/she is. If she is working and making at least as much as you are, then I see no trouble at all if you want to buy the car. But, if she's those type of girls who likes to spend on clothes, makeup, gazillion shoes, wants you to spoil her all the time buying flowers etc, then urine trouble.

In all honesty, only buy the car if you have a garage or shelter you can put it in away from plain eyesight of people, because there are assholes out there who will do whatever they can to damage a good looking car. I've seen a kid running towards my car, looked at it for a second and then started pounding on my bumper, needless to say I had to do what I can to get rid of that rug rat.

urine....teehee