Can I afford this car?

[AG74683]

Originally Posted by s2d4

Common misconception, affording repayment is not the same as affording the car.

Exactly my fear, that I don't quite understand what I'd be getting into with this.

Thanks for the constructive posts! Really great community here. I've never really been pressed for money, and doubt I would be even with a 400 dollar payment. I just worry that I might be getting in too deep with a brand new car like this...

I prefer to do all my maintenance and mods on my vehicles myself, however I'm a little limited here (part of the reason I'm looking at new rather than used).

[Kostamojen]

Can you afford it? Maybe.

Should you? Doesn't sound like it so far.

[j2digit]

i think you should ask Suze Orman..............she'll tell what you need to hear.....

[kberkel]

Originally Posted by Kostamojen

Can you afford it? Maybe.

Should you? Doesn't sound like it so far.

I agree, especially with the 2nd car. You'll be stretched real thin. You'll love the car, but its never fun spending at full capacity.

Id wait a bit and maybe try to buy one around 20k miles.

[Porsche]

You appear to be doing well as a thoughtful and responsible young adult. If only your peers would do so well.

A couple of points:

1) Are you participating in an employer 401(k) match plan? It is foolish to ignore that if it's offered. You double your money right from the start with the employer match; it's free money and one should take advantage of that.

The time to start saving for retirement is NOW. Do your homework, and you'll see that I'm right.

2) You can borrow $20,527 @ 0.9% for 60 months, giving you a monthly payment of $350 (if available at your Subaru dealer). As you can see, you'll need to modify your plan.

3) You've done well. Personally, I am sympathetic to the notion that you get a nice reward for your efforts, and for your self discipline so far in your young life.

Is it the smartest financial move to buy a new car right now?

No, of course not. (Especially not if you are not participating in a 401(k) match plan.)

But, if you've got your 401(k) going and you're getting the full match, well darn it ... it would sure be nice to enjoy this wonderful car now in your young years before you get caught up in marriage and children and houses and bills and more bills and, well...

If you've got that 401(k), and you're still able to save for a rainy day, then if you were my son (I'm older than your dad), I'd say, "Do it, kiddo!" Reward yourself. You've earned it. Find the joy in your life!



P.S. Don't call me if you get into financial trouble later. Okay, so it's a tough call in these uncertain times. Are any of us safe?

[ZionsWrath]

I remember from the subaru marketing they said an expected owner would be in 30s making like 90k. I dont think they pull these numbers out of a hat. That said do what you want to do, YOLO as they say. If you are comfortable living check to check without an emergency fund, retirement account, etc then go for it.

And please tell how i can insure two cars and an apartment for $80 wtf

[AG74683]

Originally Posted by soundman98

are you looking at the premium or limited?

Limited, but I am not really set on that. If the price was right I could go with the Premium.

Originally Posted by Porsche

You appear to be doing well as a thoughtful and responsible young adult. If only your peers would do so well.

A couple of points:

1) Are you participating in an employer 401(k) match plan? It is foolish to ignore that if it's offered. You double your money right from the start with the employer match; it's free money and one should take advantage of that.

The time to start saving for retirement is NOW. Do your homework, and you'll see that I'm right.

2) You can borrow $20,527 @ 0.9% for 60 months, giving you a monthly payment of $350 (if available at your Subaru dealer). As you can see, you'll need to modify your plan.

3) You've done well. Personally, I am sympathetic to the notion that you get a nice reward for your efforts, and for your self discipline so far in your young life.

Is it the smartest financial move to buy a new car right now?

No, of course not. (Especially not if you are not participating in a 401(k) match plan.)

But, if you've got your 401(k) going and you're getting the full match, well darn it ... it would sure be nice to enjoy this wonderful car now in your young years before you get caught up in marriage and children and houses and bills and more bills and, well...

If you've got that 401(k), and you're still able to save for a rainy day, then if you were my son (I'm older than your dad), I'd say, "Do it, kiddo!" Reward yourself. You've earned it. Find the joy in your life!



P.S. Don't call me if you get into financial trouble later. Okay, so it's a tough call in these uncertain times. Are any of us safe?

Thanks for the compliments. My employer offers a 100% match (up to 5% of your pay) for the 401k. I have not been putting anything in. When I moved here, I was basically starting from scratch and needed every thing I could get in order to furnish my home and get all the requisite "home needs". Truthfully, until your post I had forgotten about the 401k entirely. . I'll be getting the paperwork from HR tomorrow to start into that program ASAP.

Originally Posted by ZionsWrath

I remember from the subaru marketing they said an expected owner would be in 30s making like 90k. I dont think they pull these numbers out of a hat. That said do what you want to do, YOLO as they say. If you are comfortable living check to check without an emergency fund, retirement account, etc then go for it.

And please tell how i can insure two cars and an apartment for $80 wtf

When I had my credit card bill and previous car payment, I tried to judge how well I would do with a larger car payment by adjusting how much I paid per month on the card. By the time I was comfortable, I was paying 430 per month on them both and probably could have gone a bit higher. I don't feel I would be stuck living paycheck to paycheck even with the car payment, but my emergency fund isn't quite where I want it to be.

Just to be sure, I quoted the BRZ with my insurance company (USAA) this morning. The insurance for both cars would be around 70, plus 20 a month for my renters....so around 90 for 2 cars and renters. I've never been in an accident (knock on wood) and have been a customer with USAA for 10 years, including two car loans.

[Masago88]

Originally Posted by AG74683

I know this isn't the standard post for this forum, but I thought I'd ask since the group here is either in my same situation, or has "been there done that" and knows if this would be something I regret ten years from now. Please delete or move if this isn't appropriate for this area of the forum mods!

Anyways, I am looking at purchasing a BRZ. I've never bought a brand new car. I have really only owned two in my life time (98 Jeep Wrangler - Sold, and a 99 Jeep Cherokee, current DD). I'll bullet point the pertinent info...

• I am 26 years old
• I hold a steady job, making in the low 40k range
• I am single
• The only debt I carry is student loans (which I do not plan to pay off immediately.)
• I rent, I do not have a mortgage or home repair concerns
• The BRZ will NOT be a daily driver. It will be a second car for longer journeys. My work commute is less than a mile.
• Insurance wise, I am looking at approximately 70-80 a month for my Cherokee, renters insurance, and the BRZ...reasonable IMO
• I will be looking at a 5k deposit approximately. Shooting for a 60 month finance rate (I want to be around $350 per month on payments...I do want to avoid the 72 month financing.)

If I have forgotten any necessary information, please let me know and I will answer as soon as I can. I graduated college in 2011, took my current job in late 2012. I haven't ever been pressed for money since I've been on my own. I live on a strict budget, not because I need to but because I want to. My concern is that at my age, I have better obligations to put my money towards. However I also believe that if one where to purchase a car like the BRZ...your mid 20's are the target area. It is an enormous decision and I am hoping to get some insight from you good folks here.

Again, sorry if this has been posted a million times, or doesn't belong here. I did search but didn't see too much in the way of answers for this question. I contacted Clint several months ago, but I decided to pay off some credit card debt I had and finish paying off my Cherokee in order to shed some monthly payments and save up a bit for a down payment on the car.

Thanks!

Wow, almost exact same boat as you. I graduated same time, started work at the same time. The difference is I have no student debt and my salary clocks in at about 60k. My employer also does 401k match (contribute the maximum, you should too if you don't already). I've saved up enough in cash to just buy it outright now, but several things keep stopping me from jumping the gun.

1) Having lived through the recession and being unemployed etc, has made me slightly paranoid and I go through a lot of needless self-drama whenever it comes to purchases that aren't 'necessary'

2) I'm a full fledged believer in the pending retirement crisis, so a lot of my money goes into mutual funds/stocks.

3) Even if you can afford it, doesn't mean you should. All depends on your life circumstances.

Although I'm starting to realize that constantly planning for the future isn't the way I want to live, and I'll be buying one sometime soon. The thing that's helped me rationalize not getting one yet more than anything, are all the 'WHEN WILL POWER UPDATE HAPPEN GUYS 2015? 2016?'

[BlueDubbinTDI]

I leased just to be safe and keep the door open after 3 years. $2k down and $320/mo out the door.

[BlueDubbinTDI]

Originally Posted by t.chk

I put down 7 for 350 over 72 months car cost me ~30k out the door new but that is 3.5% since I had zero 'real' credit when I bought it (you might get better since you have lines of credit already).

The financing I got through the dealer was a chase loan and on my document I do not get charged interest on early payments or closing the loan early. So I have been making 500-600 payments to get it done.

I work for 40k a year and rent/internet (I pay a shit-ton more money on insurance due to daily driving a sports car ~220/month state farm)

But I am only 24 so I have not hit that magic 25 year old insurance drop yet...and damnit that better be stellar.

I know it is do able for me, but you might need to throw some extra starter cash down or stretch out the payments.

Jesus, I hope nobody gets butt hurt by this but for the the 700-800/mo youre paying for this car every month between insurance and payments, you could get a much nicer ride...

[chulooz]

As has been said in all of these style posts: If you have to ask....

[airjonny]

One side of me says save the loot until you're really comfortable in making the purchase. The other part of me says do it instead of saving for a tommorow that's never promised.

[Jac]

If after car payments, insurance, tax and gas (and obviously after all your current obligations/needs) you have a comfortable amount of cash left over each month then you can afford it in my eyes.

Personally, i use Mint to track my monthly spending/income and always ensure I'm leaving a sizeable chuck each month after expenditures/savings/stocks.

All sports car purchases are unnecessary and bad investments. Just comes down to how much you like/want the car.

Originally Posted by Masago88

Although I'm starting to realize that constantly planning for the future isn't the way I want to live, and I'll be buying one sometime soon.

I was in a similar situation, it was either the BRZ or purchase more stocks. While stocks can definitely be fun I've got enough of those for now.

[Jac]

Originally Posted by t.chk

I work for 40k a year and rent/internet (I pay a shit-ton more money on insurance due to daily driving a sports car ~220/month state farm)

I moved to the US when i was 21 and was paying quite a bit more than you each month for an 09 2.5S Altima sedan. Was more than my car payment

Now at 26 i'm paying 150/month for the BRZ.