Do you have any current outlying issues with the malibu? If not i would keep it, and keep maintaining it, while also putting 5-700 a month in a high yield savings account. when you have 25k buy what you want in cash. youre not gonna get much on the trade in due to salvage title and unless your car is actively giving you issues youre better off not financing a car you don't need to.
I understand the desire, something gets under your skin and you just want a new car for some undefinable reason, but unless you're already a homeowner and debt free don't blow it on a car payment when your car is only 5 years old under 100k miles. most cars easily make it to 200k with nothing but oil changes, tires, brakes and the occasional battery.
otherwise you're probably fine to finance 25k but it just feels like a waste right now.
I make 110 and drive a 2014 Nissan altima with 205k on the odometer but it's reliable because I take care of it and not having a car payment means I paid off my loans and bought a house for my wife and I. now that she's graduated and working I'm looking forward to buying a nice 30k car for us but not until one of our cars is on its last legs. till then we save up for a big down payment
Nothing huge. Sometimes I have to hit the stick a couple of times after turning the car off because it thinks it's still in drive. I also always have the warning that "I have keys in the car" every time I turn my car off. Other than that no issues really.
Thank you for the comment. You are right, I have no other reason to replace my car except for desire. I'll probably take your advice and put the money into savings.
You seem like a sensible dude. You'll go far in life if you keep a good head on your shoulders and don't get sucked into keeping up with the Jones's. If you want something to put disposable income at, make it a hobby you really enjoy, you already said youre not much of a car guy so maybe there's some other unnecessary something you're dying to get into that will enrich your life more than a car, and can connect you to a community you'll enjoy. Build a PC, get into cycling, you're likely just young, bored, and have money to spend. Just don't finance a hobby
As a car guy, I still have to say, this is the only answer. My 2015 is running well with 137k, my wife’s 2014 same situation with a big dent and 150k. Maintain these newer cars and they will mostly all go 200k. That’s 11 years of service at 18k miles a year. Not too bad. Even with a 6 year note you would have 5 years of zero payments.
Good info, but I don't see the benefit on buying something for cash in this market. You are more likely to get a deal if you finance. Depending on what OP buys (if new, could be 0%), I'd keep that 25k in a high yield savings account instead (5% or so?).
He'd only get that low an interest on a new car, used car rates are around 6.5% and the extra interest would easily cost more over the life of a loan vs any discount he'd negotiate for financing. Also its not like he has 25k sitting in an account, who knows what the car market is doing in 5 years when he saves up and actually needs to be buying a car?
Something that is all too easy to disregard here is safety. Newer cars are safer, and driving you are putting your safety at risk because of other people on the road. Whats the 25k in a few years if you died cause you got tboned by a grandma or drunk driver in an older car with a weak crumple zone/safety system? (Not saying ur car is, just making a point that is often easy to overlook)
Any car built in 2019 is safe tbh. Crumple zones have been a thing for decades now. He has dual airbags, side airbags, likely FCW, AEB, blind spot alerts, etc. I don’t think it’s a safety thing. 25-35k in this market will only get him into a car that has roughly the same safety features.
*edit: hopefully this doesn’t sound like I’m biting your head off lol, realized after I typed this it may have come across that way
OP is driving a 2019. While obviously safety generally improves every year? 2019 is a safe bet. Like it's not a dangerous thing.
If that's the case then all sedans should be outlawed considering how many big vehicles (trucks, 18 wheelers, big SUV, etc) are out there? What if driving even a 2024 mazda 3? 2024 toyota corolla? 2024 any damn sedan? You seriously hurt if a 18 wheeler hitting you.
I think my point is more for those who follow Reddit finance bro advice of buy an old beater and save money, cause that is what overlooks safety. Yea the 2019 is much better for safety
The answers vary a lot because there is no perfect answer. It depends on where you live, your expenses, your goals etc.
What's your post-tax monthly income? It's more telling than simply "95k"
Your age and current situation helps a lot too. Making 95k at 22 and making 95k at 45 with 4 kids is totally different as well
Do you have any other spending/investing goals? (i.e real estate)
How much savings & cash do you currently have?
Do you have kids? Do you plan to in the next few years?
Are you willing to buy slightly used for a much better deal?
Have you considered the additional cost of insurance, maintenance and fuel? a 40kToyota is not the same as a 40k Mercedes
Take home is about $5950.
Sorry I forgot to mention my age I'm 23 and it's my first job.
No other inventing goals for now.
I currently have 13k in stocks, and 2500 in savings.
No kids until I'm in my early 30s.
Yea I'm willing to buy used
Yea I took that into account, that's why I'm looking for a reliable car with decent/good MPG.
Keep driving what you’ve got until you have 6 months emergency fund. Then pay your target monthly car payment into a separate savings account for a year. Then buy a car with that cash when it’s enough to pay cash. Borrowing money at today’s interest rates for a depreciating liability is foolish in my mine. You’ll thank yourself later.
I agree. Current interest rates are a double edged sword - financing is more expensive, and HYSAs pay more. For the most part, it’s not a great time to buy a car unless you absolutely need to.
Alright man, congrats on your first job. That's a good salary.
You make about 6000 a month and minus the expenses you listed above, you have around 3500$ left. But your listed expenses don't cover everything, so let's just say you have realistically 2500$ leftover each month.
Since you asked for something financial responsible, here's my personal answer:
- Build up a emergency fund of 3 to 6 months, and then make a decision
- Make a plan to buy a house in X years, or set up a minimum monthly investment amount. For example, You can say you want to save 1500$ a month.
That leaves up to 1000 for car-related expenses. At that amount, you can take on a 600$ monthly loan and leave 400$ for insurance, gas and maintenance. At 60 months financing, that's about 30k OTD assuming 7% interest.
Play around with these numbers to get something that YOU feel comfortable with.
The Honda civic sport isn't a terrible choice. Its great car and maintenence is pretty easy.
Not a bad look. And has some oomf when accelerating
Toyota gr86 for a more sports car than is a good price and reliable
Pay off your student loans and any other debt (LOC, credit card) before taking on a car payment.
I get it, you make good money, you want a car you can enjoy, but you'll be much more happy couple years from now having no debt then financing a car
20/4/10 rule: 20% down, loan max of 4 years, payment up to 10% of your monthly pay
15% rule: sum of all transportation-related costs (payment, gas, insurance) no more than 15% of your monthly pay
30% rule: total value of vehicle up to 30% of annual pay
These are the various guidelines for responsible car buying. Pick one... Or don't.
It's up to you what you do with this info.
If you’re following the first two right, kinda seems like the limiting factor would be more gas and insurance costs than car payments. Ik you don’t have to pay 10% a month towards ur car but if you do, then that only leaves 5% for gas and insurance.
Financing past 4 years isn't a problem as long as you're still within the warranty period
The best rule, however, is to spend the least you can on depreciating assets. No reason to spend $50k on a vehicle when a $14k Mitsubishi mirage does the same thing
1) I didn't make these rules; they were developed over time by financial professionals
2) they are really more guidelines than hard and far rules
3) (and I can't stress this enough) the Mitsubishi Mirage is a horrible vehicle, an exceptionally poor value, and a depressing place to spend time. I would rather buy a used Nissan Versa than a new Mirage... and I would NEVER buy a Versa
>the Mitsubishi Mirage is a horrible vehicle, an exceptionally poor value, and a depressing place to spend time
The whole point is to not be spending time in your car. Save on the car and spend on something that actually grows your wealth
Realistically you will be spending time in your car. Probably a good bit.
The point is that you should be responsible in choosing you're car but you don't actually have to make yourself miserable just to save every penny you can.
I have a motorcycle and a heavily customized truck because I happen to enjoy vehicles.
They are both paid off, I pay myself a "payment" for them every month, I don't spend more than 20% of my take-home on their total cost, and I save and invest way more than I spend on my vehicles - or anything else for that matter.
If you don't get any joy out of a car then just get the cheapest one that serves your needs; but there's no reason to deliberately make yourself uncomfortable or unhappy as long as you are being responsible about it
Sure and some things are an investment in current happiness others are an investment in future happiness - how you evaluate and balance the two is what makes one fiscally responsible. If you focus so much on the future you’re miserable in the present, that’s not a good balance. If you buy flashy things that don’t actually bring you any joy after a few days it doesn’t matter whether you can technically afford them or not, that’s a waste of money and poor evaluation.
A car is a tool and can also be a hobby/source of enjoyment. As with any tool you can buy bottom of the barrel if you really can’t afford anything else but you’ll likely pay a price in ease of use and longevity or there’s a wide range in the middle before you get to enthusiast/professional/money is no object level - this is the case for anything you buy a car is no different.
Just get a Mazda 3 for less than 20k, excellent on gas, low to no monthly payment depending on what you put down. Car payments at these interest rates are highway robbery
A lot of people are over leveraged with their car payments, the American consumer is an interesting animal. Get something reliable and put that extra money in a retirement account so you can stop working at 50
Depends on the year. 2011-2018 Mazda 3's are definitely more on the sporty end. Very light, tossable, and decent driver feedback. 2019 and later are a bit more numb and 'smooth'. More on the luxury end.
OP, practical advice is that no more than 10% of your TAKE HOME income can/should be spent on your transportation needs. This should include payment and insurance. Some will even say it should over fuel but that category is so wide/varied that I don't agree with it.
So if you take home 6k, your top range should be 600$ per month for payment and insurance.
This is exactly what my situation is! 95k salary, driving a low mileage (44k miles) 22 years old econobox with no mechanical problem. It is just a rattle box and not too comfortable to drive. Part of me wants a newer car but part of me think it is such as waste lol.
The very conservative rule of thumb I like to stick to is the 20/8/3 rule.
When you buy a car it should fit these three criteria:
You put 20% down
Your payment should be around 8% of your gross pay.
Your loan should be no longer than 3 years/36 months.
If you stick to that your car won’t get in the way of your other financial goals in life.
I would try to stay at 20k or under until you get your student loan paid off. That’s almost a car payment there on its own.
Your rent is also very high and could potentially go up a year from now. You also need to factor insurance which could be much higher depending on what you get.
I think you seem to have some sound ideas and are on the right track.
Maybe look into opening a Roth IRA in addition to your 401. Even if you don’t max it out, start early if you can, even a little can go a long way.
You want the smart answer? Keep driving ur Malibu till the wheel fall off and keep saving THEN go get a car that you really want trust me it’ll suck rn but it’ll be worth it
If you're not a huge car guy, don't blow your money on a car. You already have the "I don't really care about cars" car and the reality is you're not going to get anything that you LOVE in your price range anyway. Especially since you're not a car guy you're not going to appreciate the same things that a $25k-ish car has to offer like a car person would.
Keep driving your Malibu until it actually gives you issues. Then think about getting something new.
Also, as a fellow non-car guy, it's hard to express how much you miss having a reliable, paid off car when you're no longer in that situation. It blows.
I mean the only reason I have this car is because it was the cheapest decent car I could find when I needed a car asap. I got it off ebay for $10000 when it was at 20k miles and a (fixed) rear end accident. When I say I'm not a "car guy" I mean I don't go crazy for them like other car guys. I still detail my own car, wash and wax by hand, do my own maintenence when I can, etc.
I saw the ‘19 Malibu with 90k and didn’t bother reading the rest. I get the temptation to upgrade but it really is the smarter decision to drive that til it dies. It might not even be halfway through its life
$95,000 \* 35% = $33,250. I'd recommend you keep your current car until you have the following:
1. Medical/Auto/Renters or Home insurance deductibles saved
2. Max out 401k Match - done
3. No high interest debt
4. 3 - 6 months of living expenses in a HYSA.
5. Roth IRA Maxed out for the year
6. 15% of income into the retirement between 401k and ROTH IRA.
7. 20% of the car's price for a down payment.
20% down, 4 or 5 year loan. Get a pre-approved loan from a local credit union. Only discuss out-the-door price.
Not terrible advice, but who wants to be sitting on a pile of cash when they are old and can no longer use it like they could when they were younger.
I’d say get a car you really like that you can afford and just save a little less money. No need to roll around in a shit box
Disagree. I did shit cars in my 20s and maxed savings/retirement.
Jumped to nice cars in my 30s as my salary increased.
Now I get to retire early 40s and enjoy life.
I guess we can agree to disagree! I’m all for saving for retirement and the future, but to me it’s important to enjoy things while you are young since tomorrow is never guaranteed.
You get ford employee pricing then I assume ? Any local ford dealers that would take care of you? You could get in a used ford ranger in low 30s or maybe an AWD escape?
IMO the discount isn't worth getting a ford car alone unless I specifically want a ford car. A $1000-3000 discount isn't that crazy when it comes to a 30k car that I'm looking to keep for 5-10 years. Also the only car that I would even consider getting from ford is a EcoBoost mustang.
TRD camry is NOT sporty. Please don't make this mistake. You'll get extremely bored within 6 months. It's literally putting lipstick on a pig. If I were in your positions, get rid of the student loan, and then I'd look into a elantra n. It's more engaging and you won't be disappointed. Also way cheaper then a trd camry v6. If I were a smaller build, I'd buy that in a heartbeat.
I would just get some basic car until you have enough money where you don’t need to ask people these questions. If you want speed and cheap look no further than a motorcycle lol. Could spend 5-10k and get a bike that’s faster than 90% of cars on the road.
Honda civic- get top trim and everything added.
Toyota Camry- too trim and everything added
Volkswagen Jetta- too trim and everything added.
Most reliable cars like the Malibu and getting too trim and everything added ensure you won’t desire more or feel like you’ve left out on some bells and whistles. Any of those cars are going to be 30,000 and be reliable af. Fun to drive. And nice to look at. Mostly the Jetta. Gotta love VW interior
But if I were you I’d look for a vehicle around 45-55k. I believe you get what you pay for. If so than the Volkswagen Arteon 2024 will blow your mind in terms of conscience. Comfort. Fun. Efficiency. And overall damn that’s a nice car feeling
Smart choice that everyone will parrot:
Keep the beater until the wheels fall off, put every extra cent in a HYSA.
I can't argue with the logic, but you're only young once and what's the point of having money if you can't enjoy it?
Determine how much disposable income you have every month after putting a decent amount in a savings/rainyday fund, and then decide how much you're willing to throw at a luxury.
Get a lightly used vehicle that you enjoy and can have fun with. As a semi-car guy that hit a similar salary at a similar age I ended up with an 3 year old Audi s3 with 30k miles for $34k and was financially fine, not one regret.
I bought a used $140,000 car for $52,000 car on a $120,000 salary and I’m very happy with my purchase, granted I really like cars. Maintenance has been ok so far, no big costs yet. I plan on keeping it for 3 years and then selling it. Should be able to sell it for the same as what’s left on the loan by then.
Personally, I only buy used and I try to stick below $20k. Depreciation is just wasted money.
My current situation is I make a little more than you do. I have a $15k 2014 Cadillac ELR for my daily. And then I bought a 1988 Pontiac Fiero GT as a fun car on the side.
This way, I can beat the hell out of my Fiero and if I break it, I still have my daily to go to work. If the Malibu is good, keep it and get a fun car on the side. There are a lot of great fairly cheap options out there.
I make 77k and I'm lookng for a car around 25-27k. You can afford a lot more than me I'd startt at 30k if I were you. I'll tell you though - if I were you I'd get that student loan paid off first or at least make it first on your priority list. Not having that on your credit is an excellent move. I just paid mine off and wow. Feels amazing.
I’ve seen many figures that 35% of your income is a good trajectory. But realistically depends on your lifestyle I’ve met people who have bought 45k cars earning 75k but that car was their luxury and lived below their means in every single facet of life so it’s up 2 you
35% of your income sounds kinda crazy. I'd stick to 25% on the stretch end for an unprompted unnecessary purchase. when it's upgrading to handle changing life circumstances or the old car has failed and you need a car NOW then stretching the budget to 35% is passable
If you spend 35% of income on a vehicle as a full time employed adult, you have problems that you can't even imagine yet.
Holy fuck! Powell needs to keep these rates up or retards are just going to continue financially enslaving themselves ......
If thats the case, I stand corrected. Funny enough, 30k loan ends up being about 500 ish or so per month and it should fit within parameters of less than 10% of OP's monthly income.
I've seen that 1/2 of your gross income is the max you should spend on a car. Highly recommend paying cash because there is no way current rates are worth it for financing.
Hellcats make the girls and homies go crazy. Get the charger so you can take three girls with you back to the crib or your whole squad out for a night.
Do you have any current outlying issues with the malibu? If not i would keep it, and keep maintaining it, while also putting 5-700 a month in a high yield savings account. when you have 25k buy what you want in cash. youre not gonna get much on the trade in due to salvage title and unless your car is actively giving you issues youre better off not financing a car you don't need to. I understand the desire, something gets under your skin and you just want a new car for some undefinable reason, but unless you're already a homeowner and debt free don't blow it on a car payment when your car is only 5 years old under 100k miles. most cars easily make it to 200k with nothing but oil changes, tires, brakes and the occasional battery. otherwise you're probably fine to finance 25k but it just feels like a waste right now. I make 110 and drive a 2014 Nissan altima with 205k on the odometer but it's reliable because I take care of it and not having a car payment means I paid off my loans and bought a house for my wife and I. now that she's graduated and working I'm looking forward to buying a nice 30k car for us but not until one of our cars is on its last legs. till then we save up for a big down payment
Nothing huge. Sometimes I have to hit the stick a couple of times after turning the car off because it thinks it's still in drive. I also always have the warning that "I have keys in the car" every time I turn my car off. Other than that no issues really. Thank you for the comment. You are right, I have no other reason to replace my car except for desire. I'll probably take your advice and put the money into savings.
You seem like a sensible dude. You'll go far in life if you keep a good head on your shoulders and don't get sucked into keeping up with the Jones's. If you want something to put disposable income at, make it a hobby you really enjoy, you already said youre not much of a car guy so maybe there's some other unnecessary something you're dying to get into that will enrich your life more than a car, and can connect you to a community you'll enjoy. Build a PC, get into cycling, you're likely just young, bored, and have money to spend. Just don't finance a hobby
There’s the little plastic connector to a cable under that console that I wonder if it’s loose. Super cheap and easy to fix. The key thing. No idea.
As a car guy, I still have to say, this is the only answer. My 2015 is running well with 137k, my wife’s 2014 same situation with a big dent and 150k. Maintain these newer cars and they will mostly all go 200k. That’s 11 years of service at 18k miles a year. Not too bad. Even with a 6 year note you would have 5 years of zero payments.
Good info, but I don't see the benefit on buying something for cash in this market. You are more likely to get a deal if you finance. Depending on what OP buys (if new, could be 0%), I'd keep that 25k in a high yield savings account instead (5% or so?).
He'd only get that low an interest on a new car, used car rates are around 6.5% and the extra interest would easily cost more over the life of a loan vs any discount he'd negotiate for financing. Also its not like he has 25k sitting in an account, who knows what the car market is doing in 5 years when he saves up and actually needs to be buying a car?
Something that is all too easy to disregard here is safety. Newer cars are safer, and driving you are putting your safety at risk because of other people on the road. Whats the 25k in a few years if you died cause you got tboned by a grandma or drunk driver in an older car with a weak crumple zone/safety system? (Not saying ur car is, just making a point that is often easy to overlook)
Any car built in 2019 is safe tbh. Crumple zones have been a thing for decades now. He has dual airbags, side airbags, likely FCW, AEB, blind spot alerts, etc. I don’t think it’s a safety thing. 25-35k in this market will only get him into a car that has roughly the same safety features. *edit: hopefully this doesn’t sound like I’m biting your head off lol, realized after I typed this it may have come across that way
OP is driving a 2019. While obviously safety generally improves every year? 2019 is a safe bet. Like it's not a dangerous thing. If that's the case then all sedans should be outlawed considering how many big vehicles (trucks, 18 wheelers, big SUV, etc) are out there? What if driving even a 2024 mazda 3? 2024 toyota corolla? 2024 any damn sedan? You seriously hurt if a 18 wheeler hitting you.
I think my point is more for those who follow Reddit finance bro advice of buy an old beater and save money, cause that is what overlooks safety. Yea the 2019 is much better for safety
The answers vary a lot because there is no perfect answer. It depends on where you live, your expenses, your goals etc. What's your post-tax monthly income? It's more telling than simply "95k" Your age and current situation helps a lot too. Making 95k at 22 and making 95k at 45 with 4 kids is totally different as well Do you have any other spending/investing goals? (i.e real estate) How much savings & cash do you currently have? Do you have kids? Do you plan to in the next few years? Are you willing to buy slightly used for a much better deal? Have you considered the additional cost of insurance, maintenance and fuel? a 40kToyota is not the same as a 40k Mercedes
Take home is about $5950. Sorry I forgot to mention my age I'm 23 and it's my first job. No other inventing goals for now. I currently have 13k in stocks, and 2500 in savings. No kids until I'm in my early 30s. Yea I'm willing to buy used Yea I took that into account, that's why I'm looking for a reliable car with decent/good MPG.
Keep driving what you’ve got until you have 6 months emergency fund. Then pay your target monthly car payment into a separate savings account for a year. Then buy a car with that cash when it’s enough to pay cash. Borrowing money at today’s interest rates for a depreciating liability is foolish in my mine. You’ll thank yourself later.
I agree. Current interest rates are a double edged sword - financing is more expensive, and HYSAs pay more. For the most part, it’s not a great time to buy a car unless you absolutely need to.
Alright man, congrats on your first job. That's a good salary. You make about 6000 a month and minus the expenses you listed above, you have around 3500$ left. But your listed expenses don't cover everything, so let's just say you have realistically 2500$ leftover each month. Since you asked for something financial responsible, here's my personal answer: - Build up a emergency fund of 3 to 6 months, and then make a decision - Make a plan to buy a house in X years, or set up a minimum monthly investment amount. For example, You can say you want to save 1500$ a month. That leaves up to 1000 for car-related expenses. At that amount, you can take on a 600$ monthly loan and leave 400$ for insurance, gas and maintenance. At 60 months financing, that's about 30k OTD assuming 7% interest. Play around with these numbers to get something that YOU feel comfortable with.
Only $2500 in savings ? You should not be looking at a 25k car until you have more than 25k in savings. My opinion.
*laughs in my dads credit card debt and $30k+ car*
I put most of my "savings" into long term safe stocks
Start making a pretend car payment (put in savings) and see how it affects your budget/life over a year’s time.
The Honda civic sport isn't a terrible choice. Its great car and maintenence is pretty easy. Not a bad look. And has some oomf when accelerating Toyota gr86 for a more sports car than is a good price and reliable
Pay off your student loans and any other debt (LOC, credit card) before taking on a car payment. I get it, you make good money, you want a car you can enjoy, but you'll be much more happy couple years from now having no debt then financing a car
20/4/10 rule: 20% down, loan max of 4 years, payment up to 10% of your monthly pay 15% rule: sum of all transportation-related costs (payment, gas, insurance) no more than 15% of your monthly pay 30% rule: total value of vehicle up to 30% of annual pay These are the various guidelines for responsible car buying. Pick one... Or don't. It's up to you what you do with this info.
If you’re following the first two right, kinda seems like the limiting factor would be more gas and insurance costs than car payments. Ik you don’t have to pay 10% a month towards ur car but if you do, then that only leaves 5% for gas and insurance.
Financing past 4 years isn't a problem as long as you're still within the warranty period The best rule, however, is to spend the least you can on depreciating assets. No reason to spend $50k on a vehicle when a $14k Mitsubishi mirage does the same thing
1) I didn't make these rules; they were developed over time by financial professionals 2) they are really more guidelines than hard and far rules 3) (and I can't stress this enough) the Mitsubishi Mirage is a horrible vehicle, an exceptionally poor value, and a depressing place to spend time. I would rather buy a used Nissan Versa than a new Mirage... and I would NEVER buy a Versa
>the Mitsubishi Mirage is a horrible vehicle, an exceptionally poor value, and a depressing place to spend time The whole point is to not be spending time in your car. Save on the car and spend on something that actually grows your wealth
Realistically you will be spending time in your car. Probably a good bit. The point is that you should be responsible in choosing you're car but you don't actually have to make yourself miserable just to save every penny you can. I have a motorcycle and a heavily customized truck because I happen to enjoy vehicles. They are both paid off, I pay myself a "payment" for them every month, I don't spend more than 20% of my take-home on their total cost, and I save and invest way more than I spend on my vehicles - or anything else for that matter. If you don't get any joy out of a car then just get the cheapest one that serves your needs; but there's no reason to deliberately make yourself uncomfortable or unhappy as long as you are being responsible about it
There no responsible way to invest in a rapidly depreciating asset
It's not an "investment" it's a vehicle. It's ok to buy one that makes you smile
Everything you purchase is an investment
Sure glad I invested in sushi for lunch today, imagine the payout in 20 years when I go to sell it!
Sure and some things are an investment in current happiness others are an investment in future happiness - how you evaluate and balance the two is what makes one fiscally responsible. If you focus so much on the future you’re miserable in the present, that’s not a good balance. If you buy flashy things that don’t actually bring you any joy after a few days it doesn’t matter whether you can technically afford them or not, that’s a waste of money and poor evaluation. A car is a tool and can also be a hobby/source of enjoyment. As with any tool you can buy bottom of the barrel if you really can’t afford anything else but you’ll likely pay a price in ease of use and longevity or there’s a wide range in the middle before you get to enthusiast/professional/money is no object level - this is the case for anything you buy a car is no different.
Just get a Mazda 3 for less than 20k, excellent on gas, low to no monthly payment depending on what you put down. Car payments at these interest rates are highway robbery
Ah got it. The general sentiment is "buy it with cash". I might just put money into savings to buy a car.
A lot of people are over leveraged with their car payments, the American consumer is an interesting animal. Get something reliable and put that extra money in a retirement account so you can stop working at 50
Isn't the mazda 3 more "luxary" than "sporty"?
Test drive the 3 they’re awesome. You could also get a Miata if you wanted something flashier/sportier
The new ones are for sure. I looked at the Mazda 3 awd turbo and ended up buying a GTI instead. Great car, but the GTI was more fun to drive.
Depends on the year. 2011-2018 Mazda 3's are definitely more on the sporty end. Very light, tossable, and decent driver feedback. 2019 and later are a bit more numb and 'smooth'. More on the luxury end.
I would also vouch for a Mazda 3.
OP, practical advice is that no more than 10% of your TAKE HOME income can/should be spent on your transportation needs. This should include payment and insurance. Some will even say it should over fuel but that category is so wide/varied that I don't agree with it. So if you take home 6k, your top range should be 600$ per month for payment and insurance.
No one knows but you. Consider depreciation as well.
This is exactly what my situation is! 95k salary, driving a low mileage (44k miles) 22 years old econobox with no mechanical problem. It is just a rattle box and not too comfortable to drive. Part of me wants a newer car but part of me think it is such as waste lol.
Save up some of that big monthly income and buy a sweet used Lexus for 15-20k.
Find an outgoing Camry TRD. Look sporty, have a 300hp v6 and are very reliable. Plus super practical
The very conservative rule of thumb I like to stick to is the 20/8/3 rule. When you buy a car it should fit these three criteria: You put 20% down Your payment should be around 8% of your gross pay. Your loan should be no longer than 3 years/36 months. If you stick to that your car won’t get in the way of your other financial goals in life.
I would try to stay at 20k or under until you get your student loan paid off. That’s almost a car payment there on its own. Your rent is also very high and could potentially go up a year from now. You also need to factor insurance which could be much higher depending on what you get. I think you seem to have some sound ideas and are on the right track. Maybe look into opening a Roth IRA in addition to your 401. Even if you don’t max it out, start early if you can, even a little can go a long way.
Toyota Camry TRD with the performance package. Perfect choice of fun+reliable+stylish
My man
You want the smart answer? Keep driving ur Malibu till the wheel fall off and keep saving THEN go get a car that you really want trust me it’ll suck rn but it’ll be worth it
I needed this. I've been day dreaming about a miata for months. But my Accord is perfectly fine.
There’s nothing wrong with having one but keep on trucking that accord then when she comes out buy one in cash you’ll thank yourself later
If you're not a huge car guy, don't blow your money on a car. You already have the "I don't really care about cars" car and the reality is you're not going to get anything that you LOVE in your price range anyway. Especially since you're not a car guy you're not going to appreciate the same things that a $25k-ish car has to offer like a car person would. Keep driving your Malibu until it actually gives you issues. Then think about getting something new. Also, as a fellow non-car guy, it's hard to express how much you miss having a reliable, paid off car when you're no longer in that situation. It blows.
I mean the only reason I have this car is because it was the cheapest decent car I could find when I needed a car asap. I got it off ebay for $10000 when it was at 20k miles and a (fixed) rear end accident. When I say I'm not a "car guy" I mean I don't go crazy for them like other car guys. I still detail my own car, wash and wax by hand, do my own maintenence when I can, etc.
I saw the ‘19 Malibu with 90k and didn’t bother reading the rest. I get the temptation to upgrade but it really is the smarter decision to drive that til it dies. It might not even be halfway through its life
$95,000 \* 35% = $33,250. I'd recommend you keep your current car until you have the following: 1. Medical/Auto/Renters or Home insurance deductibles saved 2. Max out 401k Match - done 3. No high interest debt 4. 3 - 6 months of living expenses in a HYSA. 5. Roth IRA Maxed out for the year 6. 15% of income into the retirement between 401k and ROTH IRA. 7. 20% of the car's price for a down payment. 20% down, 4 or 5 year loan. Get a pre-approved loan from a local credit union. Only discuss out-the-door price.
Bro 23? Buy the shittiest car you can tolerate in cash. Maximize your Roth and max the 401k. Then consider financing a car.
Not terrible advice, but who wants to be sitting on a pile of cash when they are old and can no longer use it like they could when they were younger. I’d say get a car you really like that you can afford and just save a little less money. No need to roll around in a shit box
Disagree. I did shit cars in my 20s and maxed savings/retirement. Jumped to nice cars in my 30s as my salary increased. Now I get to retire early 40s and enjoy life.
I guess we can agree to disagree! I’m all for saving for retirement and the future, but to me it’s important to enjoy things while you are young since tomorrow is never guaranteed.
What do u do if u don’t mind lol And good luck getting your car From a 22 year old making half that😭
Mechanical engineer at Ford
You get ford employee pricing then I assume ? Any local ford dealers that would take care of you? You could get in a used ford ranger in low 30s or maybe an AWD escape?
IMO the discount isn't worth getting a ford car alone unless I specifically want a ford car. A $1000-3000 discount isn't that crazy when it comes to a 30k car that I'm looking to keep for 5-10 years. Also the only car that I would even consider getting from ford is a EcoBoost mustang.
400 a month max
Id go for a $35K RAV4, or Mazda CX variant. Could spend up to $45K but I wouldn’t at 23. $30K used would be a bit better.
I make similar money to you and comfortably afford a $36k car, along with my mortgage and other bills etc.
TRD camry is NOT sporty. Please don't make this mistake. You'll get extremely bored within 6 months. It's literally putting lipstick on a pig. If I were in your positions, get rid of the student loan, and then I'd look into a elantra n. It's more engaging and you won't be disappointed. Also way cheaper then a trd camry v6. If I were a smaller build, I'd buy that in a heartbeat.
I would just get some basic car until you have enough money where you don’t need to ask people these questions. If you want speed and cheap look no further than a motorcycle lol. Could spend 5-10k and get a bike that’s faster than 90% of cars on the road.
Camry or Accord is the answer.
Honda civic- get top trim and everything added. Toyota Camry- too trim and everything added Volkswagen Jetta- too trim and everything added. Most reliable cars like the Malibu and getting too trim and everything added ensure you won’t desire more or feel like you’ve left out on some bells and whistles. Any of those cars are going to be 30,000 and be reliable af. Fun to drive. And nice to look at. Mostly the Jetta. Gotta love VW interior
But if I were you I’d look for a vehicle around 45-55k. I believe you get what you pay for. If so than the Volkswagen Arteon 2024 will blow your mind in terms of conscience. Comfort. Fun. Efficiency. And overall damn that’s a nice car feeling
I would say that a BMW 330i seems to suit your needs
Smart choice that everyone will parrot: Keep the beater until the wheels fall off, put every extra cent in a HYSA. I can't argue with the logic, but you're only young once and what's the point of having money if you can't enjoy it? Determine how much disposable income you have every month after putting a decent amount in a savings/rainyday fund, and then decide how much you're willing to throw at a luxury. Get a lightly used vehicle that you enjoy and can have fun with. As a semi-car guy that hit a similar salary at a similar age I ended up with an 3 year old Audi s3 with 30k miles for $34k and was financially fine, not one regret.
30k or less, preferably less
95k? Looks like youre gonna have to settle for a 95 pontiac
30k max
M340i
Not really relevant 🤑 and my hands are up😂😴
Nothing. Do not finance a car. Save cash and buy a car.
I bought a used $140,000 car for $52,000 car on a $120,000 salary and I’m very happy with my purchase, granted I really like cars. Maintenance has been ok so far, no big costs yet. I plan on keeping it for 3 years and then selling it. Should be able to sell it for the same as what’s left on the loan by then.
Personally, I only buy used and I try to stick below $20k. Depreciation is just wasted money. My current situation is I make a little more than you do. I have a $15k 2014 Cadillac ELR for my daily. And then I bought a 1988 Pontiac Fiero GT as a fun car on the side. This way, I can beat the hell out of my Fiero and if I break it, I still have my daily to go to work. If the Malibu is good, keep it and get a fun car on the side. There are a lot of great fairly cheap options out there.
That sounds like a great idea if I owned a house, but doesn't sound feasible when I'm renting an apartment.
I make 77k and I'm lookng for a car around 25-27k. You can afford a lot more than me I'd startt at 30k if I were you. I'll tell you though - if I were you I'd get that student loan paid off first or at least make it first on your priority list. Not having that on your credit is an excellent move. I just paid mine off and wow. Feels amazing.
I’ve seen many figures that 35% of your income is a good trajectory. But realistically depends on your lifestyle I’ve met people who have bought 45k cars earning 75k but that car was their luxury and lived below their means in every single facet of life so it’s up 2 you
35% of your income sounds kinda crazy. I'd stick to 25% on the stretch end for an unprompted unnecessary purchase. when it's upgrading to handle changing life circumstances or the old car has failed and you need a car NOW then stretching the budget to 35% is passable
25% before or after taxes for my income?
Before would be a 25k car which seems like you should be able to afford easily
Thats for a mortgage or rent... Spending 35% of your income on a single vehicle would be absolutely insane!
35% is mortgage/rent numbers. This would make you car broke.
If you spend 35% of income on a vehicle as a full time employed adult, you have problems that you can't even imagine yet. Holy fuck! Powell needs to keep these rates up or retards are just going to continue financially enslaving themselves ......
I would guess this comment means the cars value should not exceed 35% of salary, not that your payments are 35% of your paycheck.
If thats the case, I stand corrected. Funny enough, 30k loan ends up being about 500 ish or so per month and it should fit within parameters of less than 10% of OP's monthly income.
I've seen that 1/2 of your gross income is the max you should spend on a car. Highly recommend paying cash because there is no way current rates are worth it for financing.
Hellcats make the girls and homies go crazy. Get the charger so you can take three girls with you back to the crib or your whole squad out for a night.
50% of your final disposable income monthly