Can I afford the BRZ?

[Turbo95eg6]

Do you live with your parents?

[Zed]

If you're looking for new and not in a hurry, it might be worth waiting until end of year. I was able to get manufacturer's financing for 0.9% on a new (but older model year) brz. This was back around new years in 2014 and I got a 2013MY Brz. If you color is commonly available though I'd go the lightly used route and save even more monies

[Doanation14]

Originally Posted by monstar369

Putting 7k down is way too much. It would be better to save that money and use it toward payments. IMO


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speaking in general, if the interest rate of your loan is higher then interest you can make off investing your money elsewhere then it it always best to put max downpayment possible...right? i'm just speaking from math knowledge i dont know a ton about finance

[slipdog]

No, this is a terrible choice.

For a $27k car if you put $7k down and get a loan at 3.99% your payment will be $368.24 for a 5 year loan. Over the course of the loan you'll pay $2094 in interest. So that is money that is just plain gone. The car will also decrease in value probably about 50%. So 5 years from now, you will have spent over $29k on a car that's worth around $13k-$14k.

If you take that monthly payment and invest it, then you will have somewhere around $22k-$28k in cash sitting in the bank (this is not including your $7k down payment).

How secure is your job? If you lose your job can you still afford car payments? If you get in an accident can you fix your car and pay for it if you can't work?

What if medical bills pop up? Will you have money leftover for the car if you have to drop a couple thousand on a procedure?

Also it makes no sense to "save" money for payments. That only causes you to lose more money in interest and you get close to the line of having to lose more money on gap insurance.

[Poodles]

Originally Posted by monstar369

Putting 7k down is way too much. It would be better to save that money and use it toward payments. IMO


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What? Higher down payment means less interest paid and a lower monthly payment. Unless you get 0% APR, the more you can pay up front the better.

Originally Posted by Atropine

never ever ever agree to a 72 month loan...

Also, later in thread this guy says not to put 7k down.

Monstar may be a smart guy, but his financial advice is shit.

A rule of thumb on on 60 month loans is...every thousand dollars will equal about 20 dollars a month.

So, 7k down saves you 140$ a month in payments. Also avoids interest.

As a younger person, you most likely will get a bad interest rate...we all have been there.

It sucks, but you should pay interest on a car you like and will enjoy...not a POS.

There's nothing wrong with a 72 month loan, especially if you're turning around and talking about a 60 month loan...

Originally Posted by slipdog

No, this is a terrible choice.

For a $27k car if you put $7k down and get a loan at 3.99% your payment will be $368.24 for a 5 year loan. Over the course of the loan you'll pay $2094 in interest. So that is money that is just plain gone. The car will also decrease in value probably about 50%. So 5 years from now, you will have spent over $29k on a car that's worth around $13k-$14k.

If you take that monthly payment and invest it, then you will have somewhere around $22k-$28k in cash sitting in the bank (this is not including your $7k down payment).

How secure is your job? If you lose your job can you still afford car payments? If you get in an accident can you fix your car and pay for it if you can't work?

What if medical bills pop up? Will you have money leftover for the car if you have to drop a couple thousand on a procedure?

Also it makes no sense to "save" money for payments. That only causes you to lose more money in interest and you get close to the line of having to lose more money on gap insurance.

Cars are NOT investments and should never ever be compared to investments. While your advice is sound, the security of having a new reliable car that gets great gas mileage and that you enjoy offsets the issues of depreciation.

[sukumizu]

25 and not making a terribly huge amount but I managed to secure cheap living in my city and seeing as how I don't buy a large amount of stuff in the first place, it adds up in my bank accounts.

Put down $7.2k, relatives cosigned so I can run at a much lower interest rate (0.9), and my minimum payments are around $425 a month. That said, I don't intend on riding out the entire 48 months of my term and I'll probably be throwing in $500-600+ whenever possible.

Don't really know the specifics of other factors in your life but if you're smart with your money, you can make it work.

[JS + BRZ]

YOLO.

Do it. :O

[strat61caster]

imo it's a bit much given your current position, you are thriving off low living costs and you seem to think those will not increase over the next 2-5 years which it will take to pay off the car. You seem like the perfect portrait of someone who overestimates what they can afford and ends up needing to sell the car because unforeseen circumstances mean you can't pay for the car, on the surface anyway.

If you are living well within your means and saving and have a safety net (your bank account should not be zero after plopping $7k down on this thing) and are saving for retirement then there's no reason why this won't be an awesome decision (except when you realize that's a good chunk downpayment for a house just about anywhere, hell even an entire house in some places).

Personal tips, I would buy used, try to find one for less than $20k, imo no prior owner will abuse it any worse than I will. When I financed putting a downpayment >1/3 of the car amount resulted in a minor improvement in interest rate with Toyota Financial Services and in doing so GAP insurance becomes unnecessary (don't let them try to sell it to you if you don't need it, they tried to sell me when I put down >$10k, literally would've been throwing money away on that). Personally I paid mine off in ~16 months (60 month loan) saved a couple hundred bucks in interest and haven't had a car payment in over a year, feels good.

Insurance could be $40/month or $400/month, get a quote, could be the difference between keeping the lights on or driving to work depending on how your circumstances change. Just grab a VIN off a dealer site if they need it for a quote.

[Jezreel]

Factor in APR% if you plan on financing. Co-sign with a parent to get better APR.
For example:
a 30k loan @ 0.9% 60 months = $691.20 total interest, $511.52 monthly
a 30k loan @ 1.9% 60 months = $1,471.20 total interest, $524.52 monthly

[computeruser]

Your numbers look doable, but they don't leave you a huge margin. Particularly so if your insurance quote is high (or high-ish), and/or if you do not have other savings/investments to buffer yourself with. When I was 21, I'd definitely have gone with your idea; now, I would not. I think a monthly car cost - payment + insurance - of 15% of your gross income is safe, but I'm probably being rather conservative compared to most folks, though my plan leaves enough in your hypothetical budget to be saving 15% of gross for retirement, also.

That said, having a new car, with a warranty, provides some advantages over a cheaper, used car, even if it isn't the financial planner guru's favorite choice. I drove my last car for ten years without payments and between tinkering and repairs, it was costing me at least as much as a new BRZ would cost if I had financed the whole cost, and it was still old as sin, was starting to get structural rust issues, and always needed more work.

I think your idea of throwing a chunk at the down payment is sound - you are making sure you are always on the + side during the life of the loan and reducing your monthly exposure. Your alternative investment options for that money are not great right now, so it isn't like you're missing out on 10% interest or asset growth somewhere else when you throw it at your purchase price.

[Jtaylorgang]

No i do not. I live with my two friends in a 3 br house.

[Jtaylorgang]

Thank you for the replies everyone, its definitely a lot to think about. I have a couple traffic violations on my record so im afraid the insurance is going to be over $300. From reading some of your posts it sounds like ill have a payment between 350-450. So at the most id be looking at $700 a month or $500 at the lowest all together. Thats a lot of money to me lol, but i'm thinking it will be worth it.

[JS + BRZ]

google "car payment calculator"

there are a lot that you can use

[ntron1]

Originally Posted by Jtaylorgang

I'm 21 years old currently driving a 2003 Lancer. Nothing special about it. Been delivering pizzas on it for years while im working on a career on the side.
Anyways, I got myself a better job for the mean time that pays 17 an hour (about 35k a year).
I've been jonesing for a new car for a long time and with this job I think i can finally afford one. I'm not too knowledgeable about cars or purchasing them but I am extremely interested in the BRZ or the FRS.

Over the next couple months I plan to save a few thousand to put a down payment on the BRZ, probably around 7k. What do the monthly payments for this car look like? and Insurance payments?
Im gonna make about 2k a month and my other expenses are about 650 a month. I want to be able to get this car without the only 1400 being completely sucked dry.
Think I can afford it?

Nope.....