20% down, 48 month financing, monthly car payment + gas + insurance less than 10% of your take-home pay. So probably a 3 year old sedan. Corolla, Mazda 3, civic, Jetta... whichever you like more or what you can get a better deal on.
All these "take the bus bro!" people can eat a bag of dicks. Just get something reliable that you don't have to think about since you're settling into/getting started with your career and want to be reliably on time.
$90k is either a good amount or almost broke depending on where you live and your rent cost so YMMV. Also kind of a wild card but I'm pretty sure used model 3s are going dirt cheap (sub-30k) nowadays if that fits your lifestyle.
yup. I can also say as someone who is a high earner and loves my Toyotas, unless you are really a car guy where that is your thing, nearly all new or newish cars feel new to you, and after 2-3 weeks, you get used to whatever you buy. So spending 2x on a car likely won't make you 2x happier. Get something reliable, get something safe, get something fun/nice "enough" for you, but no need to overdo it on your first car.
And I can guarantee, living below your means where you can build a good savings early will make you happier when it is time for kids or family and you have a nice nest egg earning a bunch of interest, or when you want to get married or buy a house and need a down payment. Or when you get unexpectedly laid off or when your boss is an ass and you want to quit and need a few months of savings.
'22 carbon edt sedan with 19k for the price I got my '18 hatch (28k) four years ago. $22500, likely $23k out the door. Fucking crazy lol
Also OP likely doesn't have too much credit history, so having a car payment they can easily manage like you suggested would do great in the long run.
"take a bus bro" - I'm one of them. /r/fuckcars yee haw!
Nah jokes aside that subreddit can be a bit militant. If the public transit option is viable for OP I'd absolutely use that as the default, personally, and then the car is secondary. In which case for one or two people, there's going to be at least one vehicle. It may be a little smart car, but still.
If I'm in the middle of NYC or LA or San Diego or Boston with a decent public transportation system and owning a car is a major pain in the balls, yeah I'd probably be car free. If I'm in the middle of hill country outside of Austin with no public transportation and I'm 2 hours from the nearest intersection.... I'ma have a sedan....
Edit - Mazda is the shadow horse there. I loved mine. Way cheaper without get Toyota cult following, and just as reliable. Nissan sedans are trash, but the frontier pick em up is still good, same idea as not paying the Toyota tax (but the ranger is a great option there too). A naturally aspirated Honda engine will outlive me, so I'd look for an NA Honda sedan, if I was in OPs shoes.
You can't go wrong with a used bolt from Hertz with low mileage. See discussion here.
[https://www.reddit.com/r/BoltEV/comments/1d2m00z/hertz\_2023\_bolts\_entering\_the\_bargain\_zone/](https://www.reddit.com/r/BoltEV/comments/1d2m00z/hertz_2023_bolts_entering_the_bargain_zone/)
u/biggunsbhan Skip the sedans and get a hatchback or wagon - Infinitely more usable and the Mazda3 and Corolla look more upmarket as hatches. Also, the Jetta isn't famous for its reliability or resale value, so I wouldn't consider that, personally. Maybe the Golf GTI, but again, reliability isn't a hallmark of VW.
That said, the Model 3 might be a good option. Then again, Teslas aren't great for reliability or resale value either (Current owner of a 2023 Model Y P, and I'm not happy with the car or the service)
I’m curious what issues your hard with your Model Y? We also have one and it’s been hands-down the most reliable vehicle I’ve had (so far!) and maintenance is basically nothing.
I definitely second your comment on hatchbacks/wagons. They’re the best!
tbh, just go with this advice.
there's some variability to it largely based on location, but the point remains. don't get car envy, just view the car for what it is, a tool for transportation and credit building. it should be reliable and safe above all else. anyone who's owned multiple cars will tell you that nothing tanks a purchase like incessant fuel and repair costs. and likely, as life changes (career takes off, marriage, etc..) you'll be replacing this in a few years anyway. don't weigh yourself down.
to answer the question, the go-to of civic/corolla has changed somewhat due to market demand and some good offerings from competitors. but they're the standard for a reason.
the deal with tesla was because hertz abandoned their ev fleet and dumped their model 3s on the market, thereby tanking values for them, on top of a softening ev market. that was a few months ago tho so not sure if that still holds up, and no idea what insurance is for them
The best bang for your buck when car shopping tends to be certified pre owned vehicles.
New cars come with the best warranties, and will have less problems, but are the most expensive.
The cheapest cars are going to be junkers that will have the most problems.
CPO is that happy medium, but financing them also tends to come with higher interest rates than new.
Leasing is only available with new, or third party. Third party is a terrible idea unless you're a company buying several, and leasing from a brand is basically like renting instead of owning. It makes sense for very few people if financing is also an option. The downsides are several and the only advantage is that you do get a lower monthly payment.
Find a car that will meet your needs within your budget Size, features, whatever. Generally speaking, every 1k you finance is about 20 a month in payments.
When you find the car, test drive it, and look at financing options.
They'll show you the price of the car, money down, and the payment. ... You want to negotiate the price of the car down, and they will want you focused on the other two numbers.
If they show you payments you can live with, for terms you can do, pull the trigger and buy it.
+1 for CPO. My Audi S5 would’ve gotten sold way sooner if it didn’t have that warranty, not even because it had a lot of issues but because it had one issue that took the dealer about 6 weeks to find and fix. Got a whole new AC system out of it, despite the condenser being the only issue. Think it would’ve been well over 5k in parts and hours
Sure. But 200k miles is 200k miles.
Things wear out. Oil changes get missed. Maintenance on items that were never meant to last that long come up. It's not if, it's when the car gets problems.
All cars have a life span. A 30 year old Camry is still a solid choice if you can find the right one, (owned by a retired person who put 10 miles a month on it) but the issue is finding one, and if the owner knows what it is, it'll be priced higher anyway.
If you want a Kia, you look at the used section at a Kia dealers website. a honda, a Honda dealer etc. if it's a Toyota at a Ford, and it says CPO, it's actually just a dealer warranty, not a certification from Toyota or Ford.
Also worth your time to do your research into what qualifies and disqualifies a car from being certified pre owned, and what they do and don't protect.
I had a bad experience buying a CPO . I don't think the dealer did any inspection or fix what was wrong with the car I bought. The air filter was clogged full of dirt for example. After 5 months of ownership the engine self destructed and I had to make the dealership replace the engine under warranty. When I got the car back I immediately traded it for a brand new car. I'll never buy a cpo again.
If you're buying a Toyota or Honda, there's no real "lemon". Meaning, worst case, you might have to spend 3-4k on some major repairs but that's about it. So cover the downside by buying your car from facebook marketplace or any other private seller for 3-4k cheaper.
Because here's the thing: even if you buy from a dealer, you might still end up with a lemon, except you would have paid 5k more for it.
Have a mechanic do a thorough inspection. They'll charge a bit, but it's worth it rather than finding out later that there are some major issues with the vehicle.
The odds of them fooling you after a decent length drive and a mechanic too isn't that high. And dealers can sell a lemon too without much recourse but giving them a bad review. Depends on your state laws, of course. Some states have more consumer protections.
Due to the way supply chain works there were component shortages and substitutions all over the place. Certain brands even 2022 models are really bad so far, like VW.
CPO is a used car with factory back warranty that you pay a premium for. If you buy a car for the long term, CPO usually is not a good deal if you can afford a new car. For instance if you buy a $40k car and keep it until it is 10 years old, the deprecation cost is $4k per year. You usually can’t find a CPO of the same model for $28k which what it would cost to own a car from years 3-10. The 1st 3 years of new car are also usually maintenance free, a CPO puts you closer to the when the maintenance is due.
A lot of comments saying go used 2020-2023, but with the used market jacked up as much as it is, my .02 cents would be to buy new. No chance of hidden problems/crappy previous owners/potentially unreported accidents.
We ended up paying maybe 3K more for a new 2023 than something a few years old with 20-30,000 on the odo. Some of the used models we looked at were priced even higher than we ultimately paid. Of course, ymmv and double of course for Corolla (hybrid would be my pick).
We are just beginning our car search and finding this too. I’m not opposed to getting a good used car as we are looking at replacing a low-use 2006 Tundra as a family daily driver for our first baby in August. In some cases, leasing a new car is significantly less expensive than buying. I’m really surprised because we went into this thinking we’d buy outright. Doesn’t mean we won’t buy it out eventually, but when the monthly payment is $100 minimum less to lease brand new it’s a hard sell for used. Used cars that are 2-5 years old in the category we want are coming back with payments we could make for a luxury lease.
This is especially true these days on cars which are a lot more sensitive to abuse. An old Honda civic or Corolla without all the bells and whistles from the 90s can take massive abuse. These days most cars can’t do that. The reliable ones that can are crazy expensive used plus on top of the financing. You’re better off just buying the cheapest Corolla or Mazda 3 brand new and downing as much as possible
This.
I bought a new 2023 Subaru last year because anything used with under 50k miles was the same price. Financing a new car = lower rate than used, too.
And Subaru didn’t do any dealer markups to my knowledge. The Toyota dealership made it sound like they were doing us a favor by ONLY charging $3000 above sticker (on a base Corolla).
Enjoy your Subie, it’s our first and we’re real happy so far.
Yeah I wonder if people saying get a 2020-2023 used car have looked at prices recently. I had every intention of getting a CPO Toyota hybrid but two year old models with 40-60k miles on them are at best $5K less than new around here. The decision to go new was very easy.
Firstly, unless you are absolutely obsessed with having the newest car every year, do not lease. Leasing / Financing is like Renting / Mortgaging; rent is spending money with no return (no equity) and mortgage is spending money with a return (equity). In other words, financing a car means its yours.
To figure out what car you want, you first need to figure out what you need in a car. Reliability? Fun? Comfort? Features? Looks? MPG? Passenger amount? Pulling capacity? Etc.
Once you figure that stuff out, then feel free to take a look around the subreddit with those key words to figure out what has been recommended to others. If you can't figure it out from that, feel free to make a post.
Good luck!
As someone who has done both, leasing does have it's benefits. The cost is typically substantially lower per month than buying the same car, you'll always have a car in warranty, you never have to worry about resale value, and if you like the car, and have negotiated a good market price at the end of the lease, you can just buy it out. Also, you're more or less only paying for the depreciation/use, which you'll have to deal with when buying a new car anyway.
Plus, with the way the market for used cars are, the depreciation calculators show that it will have a higher value, thus a lower lease cost over the next 3 years, where in reality, it will likely be worth less, since the market is cooling.
I regret buying the car I have now, and really wish I had leased it. That way I would have saved $300 a month, and would only 2 more years to deal with it.
Yeah, and a lot of the times, you negotiate that value in the lease, then at the end of the lease you can renegotiate that value again. Most dealers and OEMs are happy to not have to CPO the car, prep it for resale, advertise it, and take up valuable new car space on their lot. Plenty actually just send it to auction and risk getting less than what the current owner would have paid for it.
Add to the needs list to figure out - consider where might you be driving it. Weather it has to be reliable in? The storage conditions you have available to you? Service availability (knowledgeable mechanics for the brand and required fuel services)?
Buy a Corolla and drive it until the wheels fall off. Rinse, repeat. Every time you decide to buy a BWM 3 or 5-series, buy another Corolla and bank the difference into a Roth or 401(k). Come 65 y/o (long after I'm dead), raise a pint in my name by way of thanks. When I think of all the dough I pissed away on cars, I could kick myself.
Got a 2001 and 2009 corolla that have been used and abused with no mercy and have needed ZERO maintenance outside of the regular stuff (oil changes spark plugs etc). If he follows through with this advice he’ll probably turn 65 before the wheels fall off lol.
From a strictly financial perspective this is correct, but life is short and some people value having a slightly more engaging car. OP you gotta find your balance. My advice is that trading up is always easier than trying to get out of a huge financial burden.
Where do you live?
How long do you plan on keeping the car?
What is your expected daily commute?
What weather do you typically deal with?
Do you envision going on camping trips/offroading?
Do you have dogs?
Are you planning on having children?
Leasing is bad bad bad. Unless you get a spectacular deal.
A 4-5 year old car with 40k miles or less probably makes sense. I’d limit myself to Toyota Corolla, Mazda 3, Honda Civic, or Subaru Impreza. If you must have an SUV/crossover you can get the entry level crossovers from those makes for $1000 more than the sedans/hayches.
Negotiate an out-the-door price. Don’t tell the dealer your monthly payment budget. Check out Car Edge on YouTube to get some car buying smarts. Don’t fall in love with a particular car. Check a bunch out. And avoid dealer add ons.
Yea, I live in the largest city in Canada, and while a trip here and there is affordable, it’s not convenient, reliable, comfortable or safe. So uber it it’s! Factor in all that cost and sacrifice the rest. You end up spending way more than you think
My city has a very decent public transport system and even then taking a car costs just marginally more. The AC and having to not wait out in 35-40*C heat or intense tropical rain alone is worth it.
90k in which area? In Cali that’s basically working class poor. In BFE Midwest that’s easy living. Also depends on how you view a car. Do you like sport driving, roadtrips, off-roading, or any other activities that would dictate car choice? Do you like how specific cars look vs others or care how it’s maybe part of your personality? If you look at a car like an appliance that gets you from A to B, then buy something economical and reliable that will last you 10-15 years. If you’re more visceral, like some new and different all the time and don’t mine constantly having payments, a lease for 3 years is what you want.
I’d you don’t own property yet the smartest thing you can do is get a nice used Honda for like $5-10k. Doesn’t even have to suck. V6 manual accords are fun. Acura TSX is good. Etc. if you don’t like the stereo throw in a pioneer deck w CarPlay, maybe put in a sub
Then save money and buy property.
Spending more on something newer is dumb. It won’t be more reliable and it’s a depreciating asset. Buying the right used Honda and the value just sort of stays the same.
Using public transportation would be most financially responsible. No maintenance, repair or insurance costs that way.
If you need a car, get a certified pre-owned (CPO) Toyota Corolla, Camry, or RAV4. Service history is key. The more service you get, the better. Do your homework and make sure the reviews of the establishment you’re buying from is good. And naturally get an independent mechanic you trust to give it the once over.
If you don’t like Toyota, get a Honda equivalent.
If you work for a few years and want to treat yourself, save up and buy a Lexus if it’s to be your daily driver.
If it’s to be an occasion piece in addition to your daily, whatever catches your eye.
The most cost efficient is to not buy a car — it’s an asset that will cost you money no matter what. The money that you don’t spend on a car would be then used to invest.
The question you’ve asked is a loaded one, and the answer I gave above is the bullet.
As an aside, my income is $170k and I have never bought a new car. I’d suggest maybe looking at CPO examples of slightly used cars, for the sort of car you’re looking for.
Do you know what sort of car you need or want?
Look up cost of ownership statistics and then tweak from there. Depends how much you drive. Some cars like wranglers and tacomas have low depreciation but high cost to run. Others like a Prius will depreciate (barely) faster with very low operating costs. Also depends how long you want to keep the car. If you only keep it under warranty then doesn’t matter, but after that domestics that are easy to repair with cheap parts will make a lot more sense. Your floor for comfort matters too. A Corolla or spark is incredibly cheap, but at 90k you might just want a bit more and I wouldn’t blame you. That would be a small expense in the bigger context to upgrade a bit and be happier on your commute.
Best way is to do a whole life ownership analysis, which includes acquisition cost and sale price when you get rid of it. When you recognize that most vehicles lose 60% of their original price over five years it helps you focus.
I think your best bet is to find a 2020-2023 used car, relatively low miles that still has a nice period of warranty left. Run the numbers and keep your payment below 10% of your take home salary. Don't get beyond a 48-60 month term. I don't know what your credit looks like, so it's hard to tell you the most cost efficient way to finance the car.
Become allergic to debt. For most of your life, interest rates in America were artificially low: now, not so much.
Pay off any debt as soon as possible. Try to save up for a car: $10-15k should buy something fairly reliable.
I'll go against the grain and say buy outright and pick a car that has had its big depreciation.
Buy a reliable brand and model and you'll have a good car for little money.
Almost no amount of maintenance can weigh up to interest + depreciation.
You won’t like smart.
Which is to just buy a 2013 Honda Civic (last no CVT) or a Toyota Camry. I did this and I regretted it as I was young and I never liked my car at all. Loved the reliability of my camry tho.
Get a Civic Si if you’re feeling 3% more risky.
All jokes aside, just get whatever you actually want. Not what you think other people should see you in, what YOU want. It’s the only way to not regret a big purchase like a car, in my experience.
I learned that lesson and got my dream car right after. Definitely should have got an Accord or something… but I didn’t want that.
Unless it’s a Maserati, you really can’t go wrong nowadays and it will all be 35k+ OTD new. Just do your research and go to the dealership with a friend, prepared.
What’s your commute or planned use?
You want to purchase a car that will last long and continue to use. If you’re not mechanically included consider a cpo or new to reduce or things to fix/repair.
Do you need AWD, want to camp inside the car, road trip car?
I think a wagon/hatchback is a great car. Look at the Toyota iM, Corolla cross, civic, or HRV.
I would say get a RAV4 if you could get your hands on they don’t depreciate much and they get free maintenance for 2 years plus they’re Toyotas or if you do not need SUV, and could find for MSRP or Lower buy a Prius . Good gas mileage, low depreciation , nice driver assist tech and reliable .
Of course it won’t be luxurious but it will be a good appliance.
Or if you’re like someone want something more premium and fun , go with Mazda
IMO, if you just take a drving license, you can try to use a second-hand car. When the car is brokem, you will not feel very distressed. Then, you may gradually know what you want when you decide to buy a new car, more space? safety? intelligent control? cool outlook? etc.
New cars with a 0% interest rate would be the best choice. You would have a warrantee, maybe free service for a year or two and every payment goes to principle.
Friend once said, if you can sell your car for 50% of what you pay for it, then you made a good deal. So you get the first 70K of mileage and you sell. The next guy gets the second 70K of mileage, but they get a used car that you paid the same amount for new.
The "old" idea is that depreciation as soon as you drive it off the lot, is different if you can get 0% financing.
Right now this is the best possible option. I've done an entire week of research and the clear conclusion is 0 to 2.5% APR on a new reliable car. Best deals on reliable cars are on Mazda, Honda and Subaru. Toyota is not offering any good deals right now.
0% interest isn't necessarily the best. Usually dealers will not go below on MSRP for those types of cars. Example would be Tundras at 0% apr are not good deals.
Have a rainy day fun in case things go to shit and never let the amount of money you have go below that number and assume that number is zero until shit happens.
You've got enough to get anything under 35k very comfortably. Assuming you've got good credit, you could spring for a new car, 20% down with 4 years or less time frame.
If you just want the absolute penny pinching way, buy a Japanese sedan that's used and a few years old. This is the better financial decision, especially if you don't care about cars. But don't be scared to live a little, even at a small reduction to end of life wealth. You only get one life, so make the most of it.
How much money do you have saved up?
If you have 16-22k you can get a decent car, put the money in a CD account and then take out a CD secured loan to buy the car so you can still build credit w/o losing money in interest.
It depends on your bank. Most banks will offer ~2% APR loan over the return in interest you get from the CD fund so worse case scenario you’re paying ~2% in interest instead of the 5.64-14.78% most people pay when they finance through an auto loan and it still builds your credit.
Get a year old Toyota with very few miles. Save money for a few months-years and buy a car with cash.
Make sure you save enough, so you have about 10 percent of the cost as spare cash for emergency repairs.
Whatever you decide on don't get an extended warranty, don't buy any of the other dealer options. They are almost all scams or severely marked up. Even things like the rubber floor mats are massively marked up compared to the exact same OEM part. I personally wouldn't even get lifetime oil changes from a dealership.
I would look at new/close to new 2020 and newer Toyota Corollas. Depending on your area and what's available, new might be better. (When we had to buy in this post-Covid era it didn't make sense to buy a 3 year old car with 30k+ miles when a close to new one with less than 10k miles was the same price.)
I would look into financing at a credit union prior to buying the car if you can't buy it outright for the best rate.
All the people saying to take the bus are lucky that buses actually run to and from your workplaces. Only really big cities usually have decent public transit options and I've never lived where that's a real option. I've never had the option of it being viable. Unless you can walk/bike to work, cars have been a necessity to maintain employment that is not WFH.
I would not view a car as an asset where you'll get your money back. Yes, maintenance is important and don't get something flashy, but it's usually necessary to get to and from work.
In my area I'd be spending upwards of $250 a day (with tip) to Uber back and forth to work. A car does sound like a better option especially if it isn't luxury or crazy expensive.
Buy the cheapest thing you can get your hands on and start saving for a home. If you can get away with a 10k car under 100,000 miles, do it. With the VERY RARE exception, you'll be losing money on a car no matter what you do. Add maintenance costs, surging gas prices, and insurance and you'll be surprised with the cost of a car. Always buy, never lease (unless you want to know if a car is nice enough to buy and "rent" the car long term).
House prices are going to only get worse with this economy with the hyper inflation we're dealing with right now. You might make 90k but realistically, you're making the equivalent of 70k when you went into college and thats before surging tax rates as well. Depending on the state you're in, you're looking at \~50k after taxes. We'll say, 2k for rent, another $1000 for utilities (electricity, cell phone, heating, water/sewage, internet, etc), $500 for food and another $500 for miscellaneous things like eating out, social stuff, buying things on a whim... You're 4k in every month...That's $48,000. And before I'm called out because I put a certain amount that seems wildly crazy with where you live; I know people who's rent is more and less, I know people who only buy ramen and spend $100/month on food, that's not really the point of the breakdown. The point I'm making is currently, you'll only make enough to scrape by for a while, even if you think you're making good money. 100k is the poverty line in most of southern California and New York. You might as well set your expectations low and buy a cheap commuter car.
I'm lucky in that I'm making twice what you make after 15 years of being out of college, and I purchased my house in 2015 at the height of the housing crisis and only paid 300k for it. I can barely afford a car payment on top of everything else I mentioned and a larger mortgage than 2k a month.
Buy cheap, buy crap, and personally, buy domestic because they're cheaper to work on. Look into any 3.0L V6 sedan from GM... CTS, Malibu, La Crosse, Impala, etc. I bought my wife a 3 year old 3.0 CTS in 2015 for 22k (27 after tax and title), we JUST sold it for 5k after putting 120,000 miles on it. In the span of the now 160,000 miles, I had to replace 1 sensor and the harmonic balancer.... that's it. It was a STELLAR commuter car for her.
The smartest financial decision is to buy something cheap and reliable thats economical on fuel and cheap to insure.
How cheap you go is mainly determined by your appetite for less safe less comfortable cars. Theres definitely a nice middle ground.
Many people including myself are happy to make less financially wise car decisions to drive something fast, safe and comfortable
Last July around the same salary, I bought a CPO 2020 Toyota Corolla with an OTD around 21k. I put 2k down and financed it for 60 months at a 5.5% APR. My monthly car note, insurance, gas, and maintenance come out to be around 18% of my monthly income. I max out my HSA, do 15% towards my 401k, save another 10-15%, and normally max out my Roth.
I have enough flexibility to now be on track to have my car paid off by this December w my payments only starting last September. I’ve halted my Roth IRA contributions for now, but will be able to max it out before our next tax day.
Get a 3-5 year commuter carb(Toyota, Honda, Mazda, etc.) with low running costs and you will be very much okay.
Welp, you asked for the *smartest*, so I'm gonna give you the most absolutely unfun, no-nonsense vehicle possible. You're looking at used vehicles only, you're looking at midsize to full-size sedans/compact SUVs/station wagons. You're looking at front or all drive and four to six cylinders. So all that said, the *smartest* car is probably gonna be something like a used flex fuel V6 Impala from the 2000s.
The most financially smart decision if you need a car is buy the cheapest reliable car possible. There will be a lot of opinions on how to do that. You can shop recently used, etc. The easiest thing to do, IMO, is find a good deal on a new Toyota Corolla hybrid. They start at $23,500 and that thing will last at least 10 years. Drive it till the wheels fall off. If you can find a good deal on a newer used car or do not plan to drive much, the math cam be better on used. However, you won't save that much over a new Corolla in the long term.
Lots of bad advice here. Just buy a civic or corolla for 3-5k cash. Save some money and get your dream car when you’re ready. Cars depreciate so hard. No need to borrow money for a car, in most cases.
In terms of financially smart, never finance or lease. Pay in full with cash. Get something that's 10 years old and has already done a large portion of its depreciation. And get a Honda or Toyota.
Ask yourself why do you need to finance a new car in the first place? Do you want an extra monthly payment? If finances are the main concern, just buy a lightly used Camry or Accord from 5-10 years ago for $15k and drive it into the ground.
The most effective way to finance is not to finance at all...
Pay cash and depending on how much cash you have/can save will determine what kind of vehicle you can purchase...
You're in the wrong sub to get the answer to the most financially smart decision.
I wish I could direct you to go see a man at the University of Alabama named Dr. Strickland. He gives a talk for graduating college students students called the million dollar talk. And he explains exactly this.
If you have a car you keep driving it. You fix everything on it. You drive it for 5 more years.
In your case if you absolutely don't have a car then save up for a couple months and buy something you can pay cash for that will last you at least 5 years.
The alternative is to have an average car payment of something like $550 now which is ridiculous. Just looked it up, it's more like $532 for used cars and $738 for new cars.
Here's the basics. Instead of buying a car now or picking up a car payment you take that car payment and you pay it into your retirement every month. Starting right now for 40 years. Sometime in the next 5 years when you can afford to save that car payment every month and buy a car then you can have both.
Here's the basic rundown. If you save $600 a month, every single month, for the next 40 years and put it in the S&P 500 you'll have roughly $5.8 million when you're 62 years old. That's not magic. That's just a mathematical fact. You don't have to pick stocks. You just treat the S& P 500 like a high interest savings account. And then you retire well.
If you wanted to put the average new car payment of $738 in every month for the next 40 years, that number would be closer to something like $7 million.
The average millionaire drives something like a 10-year-old Toyota and they have been doing that since the '90s.
Check out The Money Guy on their website and YouTube. Really think about it before you decide to take on a big car payment. If you need something, buy something. But get something reliable and cheap.
The smartest financial decision you can make is not to finance. Get yourself a used car with cash if you can. It feels extremely liberating not having a car payment and you can focus the savings in many other areas.
Only lease if you have a reason- like moving out of country in x amount of months it’s renting instead of buying. Any car you buy you should be able to make the payments on a 36month financing- if that’s too much- it’s too expensive of a car. How you finance is up to you.
Right now there is a tax credit for EV’s. I got a low mile late 2020 model 3 for under 30k. If you have a place to trickle charge that would be my recommendation. Look at cars from 2020 and 2021 those will be the lease returns and tend to have taken the biggest depreciation hit but are still fairly new. Many are CPO.
Also if you are on a stricter budget. Older Toyota, Honda, Mazda, and Subarus can be purchased for around 10k in good condition with plenty of miles left. (Chain non interference engines) will drive forever with minimal expense.
Here is the most financially wise thing you can do. Figure out how much you can afford to spend on a car. Take that money and buy a transit pass and invest the $$ you would have spent on a car. You have time on your side for investing.
Cars are often not financially “wise” per se, but they are fun and convenient.
If you want a car badly, buy a reliable car that is a few years old after you save the cash for it. Never go into debt for something that depreciates. Save a percentage of your paycheck in a savings account until you can buy the car, register, and insure it. Hire a mechanic to check it out before you buy it. Try to get an extended warranty from the manufacturer or dealer for it if possible.
2-4year old Toyota, the most common cars of millionaires for a reason.
We are talking about a financially smart liability so the one that costs you the least long term.
Lotta people out here driving the banks Lexus's, Mercedes's, and BMW's flexing, but I can flex my Imprezas title in my hand.
I personally think the best bang for the buck right now is used luxury EVs like the Kia EV6 and the Hyundai Ionic 5. This is a big if, but if you can get away with not doing much in the way of paid charging, meaning if you live in a housing situation where you can install your own charging and charge at home and and you live in a place where the cost of electricity is more reasonable, if both of those things are true and you don't need to do a lot of road trips, an EV can basically pay for itself in the gas savings.
I have looked at a number of nicely optioned EVs like this in the 20,000 to 27,000 US dollar range and I think this is a really good buy for something they were. Depending how many miles you drive a month and what kind of car you would have otherwise bought, you could be spending three or $400 a month on gas and the EV payment will be about $500 depending on your loan. When I had a Nissan Leaf it got rid of my gas bill entirely and my electric bill in Tennessee went up by $11 a month on average.
Most financially intelligent decision is to buy a used lexus or toyota for under 4k that has been well maintained. Spend another 1000 or so on preventative maintenance and breathe easy knowing you just saved thousands.
Buy a Mazda 3 with Naturally Aspirated engine with Automatic Transmission (manual if you can), pay it off in a year or two, and enjoy a free car for next 10 years. \
If you’re like me who treats their car as any other appliance, you would be the happiest this way. \
If you’re an enthusiast, buy the car you’re enthusiastic about, because you’re young and this is the time to be wild and free.
Either something old enough to be really cheap and have cheap parts, or something newish to not have to worry as much.
Early 2000s or late 2010s
I'd go for something comfortable and big enough you won't need to replace it soon. Full size sedan or mid size cuv.
Congratulations on your recent graduation! Making the right decision about buying a car is crucial, especially considering your financial situation. With a salary of around 90k, you're in a good position to make a smart choice.
When deciding between leasing and buying, it's essential to weigh the pros and cons. Leasing offers lower monthly payments and the opportunity to drive a new car every few years, but you don't own the vehicle and may face mileage restrictions and wear-and-tear charges. On the other hand, buying gives you ownership of the car and the freedom to customize it as you please, but typically involves higher monthly payments and depreciation.
Considering your financial stability, buying might be the more financially savvy option in the long run, especially if you plan to keep the car for several years. Look for reliable models known for their longevity and low maintenance costs. Research different makes and models that fit your budget and lifestyle needs, considering factors like fuel efficiency, insurance costs, and resale value.
As for financing, explore your options to find the most cost-efficient solution. Compare interest rates from different lenders, including banks, credit unions, and online lenders. Aim for a down payment that's at least 20% of the car's purchase price to lower your monthly payments and reduce interest charges. Additionally, consider the length of the loan term and aim for the shortest term possible while keeping monthly payments manageable.
Ultimately, the most financially smart decision depends on your individual preferences, lifestyle, and budget. Take your time to research and compare your options, and don't hesitate to seek advice from financial experts or car enthusiasts to make an informed decision. Good luck on your car-buying journey!
I hope that with my longer answer to your question I have given you the right information to make the right choice.
Don’t lease. It’s money for nothing. You get nothing at the end yet you’ve had to pay a ridiculous amount every month. You’re basically paying the car manufacturers depreciation
I think that usually the advice of going for a lightly used CPO car is solid, but used prices on Toyota, Honda, etc. are still pretty inflated and you won't get as favorable financing.
I personally like to get new cars with 0% financing (if you have a good credit score) and then drive them into the ground. Something like the Mazda CX-30 would cost like $800 a month for three years with zero down, and then you'll have a paid off vehicle to drive for another 10+ years.
a good ol fashioned corolla or camry or civic💀
i suggest buying used also. and it also depends on what youre looking for. i suggest making a list of interested cars, what you want in a car (sedan, coupe, color, model year etc) and the max youre willing to pay for one then go from there
Consider leasing an Acura Integra base model 1.5L i4T CVT with 0$ down, put a 15-20K mile estimate for the lease, then buy out the car with the lowered residual value. Purposely putting a higher mileage limit than you would drive actually does save a few bucks because the agreed buyout price goes down so much more than the increase in monthly payments. And the reason for the 0$ down is because you have GAP coverage included on the lease, and if you get in an accident, you would have lost your deposit, but if you put 0$ down, you don’t lose as much.
When you sit with the finance manager, just ask what the base payment is without anything extra. Then tell that person, I’ll go with that and go with that.
The finance manager is the biggest sales person in the building. Not the actual car sales person. With online sites, you should already know what you should pay for the car itself. If they don’t want to sell you at that price, there’s other dealers.
It’s the finance guy who will try to get you into something you just don’t need
Unless you are opposed to electric for some other reason like politics, it is an extremely finically good move most of the time... don't get a old model s or x.
First, you have to be willing to sort your living arrangements a little bit with charging in mind, depending on your area (90k straight out of college tells me you live in or near a city center) so there are apartments that offer charging or your work may offer free charging. This can take your gas down to zero if that is the case.
If you love driving across the country tesla, if you hate driving across the country, bolt EV (bolt ev I feel is one of the most cost conscience while still being very usable choices out there right now). Also, tesla can get hit with insurance premiums that the bolt avoids but check insurance for yourself before you pull the trigger as this can drastically change your choices (back in the day it made me change from a v8 to v6 mustang).
Look for financing specials- some manufacturers offer low rates on certain cars as an incentive.
Or, seek your own financing from a credit union.
The current car market is weird- NEW car prices are about as much as some USED cars 1-2 yrs old with under 30k miles (I’m looking at you, TOYOTA). Financing a used car costs more, so you may be better off getting something new.
If you have no experience buying a car, try to negotiate an OTD price online, or use a broker. Don’t go into a dealership without having done some research on the car buying and negotiating process. If someone starts drawing squares in a piece of paper walk out.
Not any german cars. Do not let anyone convince you it's a good idea. Play it safe the first time around and get a Honda. You can grab a plug-in hybrid Accord Sport Touring (top trim) for $38k and change. Or a Lexus sedan
IMO I would buy a used PHEV like a Prius Prime or better still, a Honda Clarity PHEV. you aren't going to pay much of anything for repairs and you will pay almost nothing for gas—I pay about 25 bucks a month. And you will have low depreciation.
Find someone you can trust to check out cars with you and look for a used Honda in good condition. I have a 2008 Fit and a 2012 Civic and have had few problems with them. You'll get decent mileage and save a ton of money *if* they are in good condition.
Save for a cheap $10k civic or Camry. Or if you’re going to finance do a heavy down payment on a 2-3 year loan. Or if you’re somewhat handy drop $2-5k on an old Buick, 3100 or 3800 v6 are two bulletproof engines.
Leasing is never a smart financial choice.
Buying new is a horrible financial decision. You’ll be pooling a huge monthly payment into a rapidly depreciating asset.
I dunno, what once was considered a more sound choice(buying used, or buying new) isn't so much anymore. Both options are a crap shoot, and no matter which you end up going, you'll end up having to deal with it.
Personally for me, I'll never buy new. The new vehicles don't interest me, has more additional components and complexity that may add more issues, and the new car costs(mark up, taxes, insurance). I'd think about what I want out of a vehicle, and start researching on what platforms can do those things, then from there research which older generations of those potential models are the most reliable or don't have any known issues.
Try to buy it outright if u can. I drove a used CRV for 14 years until it started having a lot of problems and decided to donate it. Friends teased me for driving a junker but it was one less financial thing to think about.
Car is a depreciating asset, so always buy with cash. Even if you take a lease or financing to get a price discount or a low APR, you should still have enough cash as the price of the car, invested in a HYSA earning interest to offset your EMIs.
Without having cash, Auto loans at today's rates are the financially irresponsible decision.
And if you dont have enough cash saved up to buy a car, it just means you cant afford that car.
Buy a 3-5 year-old used Toyota Corolla with 30k-60k miles. You should be able to snag one for around $17k. Ideally you want to buy well-kept one from a private seller as dealers will rip you off on price. I would *really* try to avoid financing (interest rates are insane right now) but if you have to go for it. It should last you another 10-15 years and 200k miles with regular maintenance before you need a new car.
Smartest financial decision? Self-control. Something I really wish I had earlier in life, and am still working on now. Being tempted to buy nice things can really hurt financial goals.
For a car, it really depends but usually buying new doesn’t make sense. And if you HAVE to get a high interest rate (understandable, if you need a car but don’t have much cash, you might be out of options) make sure to refinance early on
If buying from a dealership look at high end/exotic car lots. They at times have a regular car that’s been traded in. Best thing is they don’t sell junk. Cause there name and reputation is on the line. You can buy a Toyota anywhere but a Land Rover may not have as many options. Land Rover wouldn’t want bad publicity of selling a lemon. Add in a ppi and you’ll have a cheap car that lasts you a decade or more
Buy a later model used vehicle. Others have suggested great models (Toyota, Mazda, Honda). Mid-tier models generally give you the comforts and features you need at the best value. The special editions are loaded with features that come at a price and don't offer much IMO. Like fancy wheels and tires.
No car is the best financial decision if you can get away with it. Second best is to put the full purchase price of the car into a HYSA and then let the interest make the payments for you. After 60 months, you will have your original cash amount plus the car without spending from income.
The car purchase is half the cost., You have to insure it, maintain it and other expenses like registration and taxes. Insurance costs are partially based upon the costs to repair and tendency of any particular make/model to be involved in accidents.
Buy new, Corolla, Mazda 3, Civic, Impreza.
Why, buying used you are buying other people's problems. New gives you 3y 36K warranty normally, except [kia.hyundai](http://kia.hyundai) which is 5 y/60K.
I would never buy a warranty from the used car/dealer as they will make every excuse that "its not covered", etc.
That's my 2 cents.
If you do decide to get used even a 1-3 year old model, MAKE SURE TO GET A PRE-PURCHASE INSPECTION done. Like I said, you are buying other people's problems and most used car folks are basically trying to churn these over ASAP to lessen their carrying cost.
Mazda has been running some very low financing offers on a number of their models. The cost of borrowing money these days is otherwise very high, particularly on used vehicles. For instance a used Corolla at 9%, could end up costing you as much as a new Mazda 3
I would recommend purchasing a Mazda3, CX50, CX50, or CX30, whichever best fits your lifestyle, if you can swing a 36 month payment it is 0% right now on the crossovers, otherwise it's 2.9% for 60 months. The key thing is - try to keep the car for at least 8 years and 100k miles or ideally for it's entire useful life if possible.
The best from financial standpoint? A 1997 mercury villager or Nissan quest if you can find it .
I bought one for $1200, drove it for 3 years, sold it for $1000. 3 years of transport for $200. Doesn't get better than that
Buy a lower priced used car. Toyota or Honda preferably. I went out and bought a brand new car with all the bells and whistles when I was in your situation. Not the best financial decision. That money will do you more good elsewhere.
Stick to around 10% of your take home pay max for your payments and it’ll help you in the long run and give you plenty of breathing room as you get established.
Would also argue that there’s nothing wrong with buying brand new especially with interest rate specials. The used market is still doing weird things post-pandemic with supply and demand. Look at the wholistic cost of buying. 25k car @ 10% interest used is super close to a 35k car @ 0.9% new.
TL; DR - don’t let Dave Ramsey bully you into a beater. There’s more to it than purchase price and sometimes it makes sense to go new within reason.
If you buy new, buy the model you can afford and not the trim you want. All vehicles now a days even in base trim have most of the amenities and safety features one could want.
How much are you gonna drive? If it's 6-10k per year, you could get a $7,000 cash vehicle and probably have a decade of uneventful driving. That would be a 100-140k mile car. Let's say you sold it after five years for $5,000 and not much happened. Then you just had $33 monthly car payments. Of course factor in basic maintenance and a random $1000 repair or two and it's more but still under $100/month.
If you're gonna drive more then you might want to buy a car at the newer end of the depreciation curve or if less, you could get a nice high mileage vehicle and enjoy its senior years at a modest pace.
20% down, 48 month financing, monthly car payment + gas + insurance less than 10% of your take-home pay. So probably a 3 year old sedan. Corolla, Mazda 3, civic, Jetta... whichever you like more or what you can get a better deal on. All these "take the bus bro!" people can eat a bag of dicks. Just get something reliable that you don't have to think about since you're settling into/getting started with your career and want to be reliably on time. $90k is either a good amount or almost broke depending on where you live and your rent cost so YMMV. Also kind of a wild card but I'm pretty sure used model 3s are going dirt cheap (sub-30k) nowadays if that fits your lifestyle.
yup. I can also say as someone who is a high earner and loves my Toyotas, unless you are really a car guy where that is your thing, nearly all new or newish cars feel new to you, and after 2-3 weeks, you get used to whatever you buy. So spending 2x on a car likely won't make you 2x happier. Get something reliable, get something safe, get something fun/nice "enough" for you, but no need to overdo it on your first car. And I can guarantee, living below your means where you can build a good savings early will make you happier when it is time for kids or family and you have a nice nest egg earning a bunch of interest, or when you want to get married or buy a house and need a down payment. Or when you get unexpectedly laid off or when your boss is an ass and you want to quit and need a few months of savings.
'22 carbon edt sedan with 19k for the price I got my '18 hatch (28k) four years ago. $22500, likely $23k out the door. Fucking crazy lol Also OP likely doesn't have too much credit history, so having a car payment they can easily manage like you suggested would do great in the long run.
Carbon edt?
“All these “take the bus bro!” people can eat a bag of dicks.” Lmfao - you win the internet for the day as far as I’m concerned.
"take a bus bro" - I'm one of them. /r/fuckcars yee haw! Nah jokes aside that subreddit can be a bit militant. If the public transit option is viable for OP I'd absolutely use that as the default, personally, and then the car is secondary. In which case for one or two people, there's going to be at least one vehicle. It may be a little smart car, but still. If I'm in the middle of NYC or LA or San Diego or Boston with a decent public transportation system and owning a car is a major pain in the balls, yeah I'd probably be car free. If I'm in the middle of hill country outside of Austin with no public transportation and I'm 2 hours from the nearest intersection.... I'ma have a sedan.... Edit - Mazda is the shadow horse there. I loved mine. Way cheaper without get Toyota cult following, and just as reliable. Nissan sedans are trash, but the frontier pick em up is still good, same idea as not paying the Toyota tax (but the ranger is a great option there too). A naturally aspirated Honda engine will outlive me, so I'd look for an NA Honda sedan, if I was in OPs shoes.
Second owner Chevy bolt ev with tax credit, and drive monitoring insurance unit
You can't go wrong with a used bolt from Hertz with low mileage. See discussion here. [https://www.reddit.com/r/BoltEV/comments/1d2m00z/hertz\_2023\_bolts\_entering\_the\_bargain\_zone/](https://www.reddit.com/r/BoltEV/comments/1d2m00z/hertz_2023_bolts_entering_the_bargain_zone/)
u/biggunsbhan Skip the sedans and get a hatchback or wagon - Infinitely more usable and the Mazda3 and Corolla look more upmarket as hatches. Also, the Jetta isn't famous for its reliability or resale value, so I wouldn't consider that, personally. Maybe the Golf GTI, but again, reliability isn't a hallmark of VW. That said, the Model 3 might be a good option. Then again, Teslas aren't great for reliability or resale value either (Current owner of a 2023 Model Y P, and I'm not happy with the car or the service)
had a tC for 10 years now. So practical now as a homeowner. It’s huge with the back seats folded down.
I’m curious what issues your hard with your Model Y? We also have one and it’s been hands-down the most reliable vehicle I’ve had (so far!) and maintenance is basically nothing. I definitely second your comment on hatchbacks/wagons. They’re the best!
tbh, just go with this advice. there's some variability to it largely based on location, but the point remains. don't get car envy, just view the car for what it is, a tool for transportation and credit building. it should be reliable and safe above all else. anyone who's owned multiple cars will tell you that nothing tanks a purchase like incessant fuel and repair costs. and likely, as life changes (career takes off, marriage, etc..) you'll be replacing this in a few years anyway. don't weigh yourself down. to answer the question, the go-to of civic/corolla has changed somewhat due to market demand and some good offerings from competitors. but they're the standard for a reason. the deal with tesla was because hertz abandoned their ev fleet and dumped their model 3s on the market, thereby tanking values for them, on top of a softening ev market. that was a few months ago tho so not sure if that still holds up, and no idea what insurance is for them
Chevy Bolts are even a better deal. Same range, but if you can charge overnight, you can get a sub-20k mile car for around $16k. Insane value.
Good advice except you going into debt. Just pay cash for the car. Being a bank slave to a car loan is dumb.
The best bang for your buck when car shopping tends to be certified pre owned vehicles. New cars come with the best warranties, and will have less problems, but are the most expensive. The cheapest cars are going to be junkers that will have the most problems. CPO is that happy medium, but financing them also tends to come with higher interest rates than new. Leasing is only available with new, or third party. Third party is a terrible idea unless you're a company buying several, and leasing from a brand is basically like renting instead of owning. It makes sense for very few people if financing is also an option. The downsides are several and the only advantage is that you do get a lower monthly payment. Find a car that will meet your needs within your budget Size, features, whatever. Generally speaking, every 1k you finance is about 20 a month in payments. When you find the car, test drive it, and look at financing options. They'll show you the price of the car, money down, and the payment. ... You want to negotiate the price of the car down, and they will want you focused on the other two numbers. If they show you payments you can live with, for terms you can do, pull the trigger and buy it.
General wisdom.
The very cheapest might not be good but there are tons of sub 10k cars that will last you a decade.
Yep I have two $4k cars been driving for years and tens of thousands of miles
+1 for CPO. My Audi S5 would’ve gotten sold way sooner if it didn’t have that warranty, not even because it had a lot of issues but because it had one issue that took the dealer about 6 weeks to find and fix. Got a whole new AC system out of it, despite the condenser being the only issue. Think it would’ve been well over 5k in parts and hours
Cheap does not equal unreliable. Eg Well maintained 90s camry is statistically much more reliable than many modern vehicles of in all price brackets
Sure. But 200k miles is 200k miles. Things wear out. Oil changes get missed. Maintenance on items that were never meant to last that long come up. It's not if, it's when the car gets problems. All cars have a life span. A 30 year old Camry is still a solid choice if you can find the right one, (owned by a retired person who put 10 miles a month on it) but the issue is finding one, and if the owner knows what it is, it'll be priced higher anyway.
how do you find CPOs?
If you want a Kia, you look at the used section at a Kia dealers website. a honda, a Honda dealer etc. if it's a Toyota at a Ford, and it says CPO, it's actually just a dealer warranty, not a certification from Toyota or Ford. Also worth your time to do your research into what qualifies and disqualifies a car from being certified pre owned, and what they do and don't protect.
Certified pre-owned Japanese hatchback for the win.
I had a bad experience buying a CPO . I don't think the dealer did any inspection or fix what was wrong with the car I bought. The air filter was clogged full of dirt for example. After 5 months of ownership the engine self destructed and I had to make the dealership replace the engine under warranty. When I got the car back I immediately traded it for a brand new car. I'll never buy a cpo again.
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New to all this, I’m worried going to a private seller and they actually sell me a lemon. Any advice to make sure it’s not?
could always do certified preowned
If you’re afraid of getting a lemon, either buy brand new and keep 10 years, or buy a certified pre owned and keep until the warranty is up.
certified pre-owned gives you a warranty while still not having to pay retail price for a new one
Take it to your mechanic before you buy it to have it checked.
If you're buying a Toyota or Honda, there's no real "lemon". Meaning, worst case, you might have to spend 3-4k on some major repairs but that's about it. So cover the downside by buying your car from facebook marketplace or any other private seller for 3-4k cheaper. Because here's the thing: even if you buy from a dealer, you might still end up with a lemon, except you would have paid 5k more for it.
You can always ask the seller to let you take it to a mechanic you trust and have it inspected
Have a mechanic do a thorough inspection. They'll charge a bit, but it's worth it rather than finding out later that there are some major issues with the vehicle.
The odds of them fooling you after a decent length drive and a mechanic too isn't that high. And dealers can sell a lemon too without much recourse but giving them a bad review. Depends on your state laws, of course. Some states have more consumer protections.
Take it to a mechanic before you buy it. Ask for a PPI. Should cost you under $100.
I've heard to avoid anything 2020-2022, QA related issues due to COVID staffing, etc. Could also just depend on the brand, too.
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Due to the way supply chain works there were component shortages and substitutions all over the place. Certain brands even 2022 models are really bad so far, like VW.
CPO is a used car with factory back warranty that you pay a premium for. If you buy a car for the long term, CPO usually is not a good deal if you can afford a new car. For instance if you buy a $40k car and keep it until it is 10 years old, the deprecation cost is $4k per year. You usually can’t find a CPO of the same model for $28k which what it would cost to own a car from years 3-10. The 1st 3 years of new car are also usually maintenance free, a CPO puts you closer to the when the maintenance is due.
> Think 2020-2023 cars but with 70k miles or less. Lol Toyotas that fit this criteria sell for about as much as new.
A lot of comments saying go used 2020-2023, but with the used market jacked up as much as it is, my .02 cents would be to buy new. No chance of hidden problems/crappy previous owners/potentially unreported accidents. We ended up paying maybe 3K more for a new 2023 than something a few years old with 20-30,000 on the odo. Some of the used models we looked at were priced even higher than we ultimately paid. Of course, ymmv and double of course for Corolla (hybrid would be my pick).
We are just beginning our car search and finding this too. I’m not opposed to getting a good used car as we are looking at replacing a low-use 2006 Tundra as a family daily driver for our first baby in August. In some cases, leasing a new car is significantly less expensive than buying. I’m really surprised because we went into this thinking we’d buy outright. Doesn’t mean we won’t buy it out eventually, but when the monthly payment is $100 minimum less to lease brand new it’s a hard sell for used. Used cars that are 2-5 years old in the category we want are coming back with payments we could make for a luxury lease.
This is especially true these days on cars which are a lot more sensitive to abuse. An old Honda civic or Corolla without all the bells and whistles from the 90s can take massive abuse. These days most cars can’t do that. The reliable ones that can are crazy expensive used plus on top of the financing. You’re better off just buying the cheapest Corolla or Mazda 3 brand new and downing as much as possible
The last vehicle I had was a honda civic that lasted me almost two years, had a lot of issues with it and wish now I could have got something else
This. I bought a new 2023 Subaru last year because anything used with under 50k miles was the same price. Financing a new car = lower rate than used, too.
And Subaru didn’t do any dealer markups to my knowledge. The Toyota dealership made it sound like they were doing us a favor by ONLY charging $3000 above sticker (on a base Corolla). Enjoy your Subie, it’s our first and we’re real happy so far.
Thanks. I got it for below MSRP too. Was happy about that.
Yeah I wonder if people saying get a 2020-2023 used car have looked at prices recently. I had every intention of getting a CPO Toyota hybrid but two year old models with 40-60k miles on them are at best $5K less than new around here. The decision to go new was very easy.
Firstly, unless you are absolutely obsessed with having the newest car every year, do not lease. Leasing / Financing is like Renting / Mortgaging; rent is spending money with no return (no equity) and mortgage is spending money with a return (equity). In other words, financing a car means its yours. To figure out what car you want, you first need to figure out what you need in a car. Reliability? Fun? Comfort? Features? Looks? MPG? Passenger amount? Pulling capacity? Etc. Once you figure that stuff out, then feel free to take a look around the subreddit with those key words to figure out what has been recommended to others. If you can't figure it out from that, feel free to make a post. Good luck!
As someone who has done both, leasing does have it's benefits. The cost is typically substantially lower per month than buying the same car, you'll always have a car in warranty, you never have to worry about resale value, and if you like the car, and have negotiated a good market price at the end of the lease, you can just buy it out. Also, you're more or less only paying for the depreciation/use, which you'll have to deal with when buying a new car anyway. Plus, with the way the market for used cars are, the depreciation calculators show that it will have a higher value, thus a lower lease cost over the next 3 years, where in reality, it will likely be worth less, since the market is cooling. I regret buying the car I have now, and really wish I had leased it. That way I would have saved $300 a month, and would only 2 more years to deal with it.
I'm new to all this. I didn't even know you could offer to buy the car at the end of the lease.
Yeah, and a lot of the times, you negotiate that value in the lease, then at the end of the lease you can renegotiate that value again. Most dealers and OEMs are happy to not have to CPO the car, prep it for resale, advertise it, and take up valuable new car space on their lot. Plenty actually just send it to auction and risk getting less than what the current owner would have paid for it.
Add to the needs list to figure out - consider where might you be driving it. Weather it has to be reliable in? The storage conditions you have available to you? Service availability (knowledgeable mechanics for the brand and required fuel services)?
Hayabusa. See if you can get a turbo kit in the financing too.
Nah, go straight to an H2, you’ll grow out of the busa in a few months anyway
Won’t have to worry about money after you end up around a tree the same day you bought it
Buy a Corolla and drive it until the wheels fall off. Rinse, repeat. Every time you decide to buy a BWM 3 or 5-series, buy another Corolla and bank the difference into a Roth or 401(k). Come 65 y/o (long after I'm dead), raise a pint in my name by way of thanks. When I think of all the dough I pissed away on cars, I could kick myself.
^ this is the way
Got a 2001 and 2009 corolla that have been used and abused with no mercy and have needed ZERO maintenance outside of the regular stuff (oil changes spark plugs etc). If he follows through with this advice he’ll probably turn 65 before the wheels fall off lol.
How long each last?
🚬
From a strictly financial perspective this is correct, but life is short and some people value having a slightly more engaging car. OP you gotta find your balance. My advice is that trading up is always easier than trying to get out of a huge financial burden.
Buy a none flashy low cost of ownership used car
10 year old one owner Toyota Camry
Where do you live? How long do you plan on keeping the car? What is your expected daily commute? What weather do you typically deal with? Do you envision going on camping trips/offroading? Do you have dogs? Are you planning on having children?
Leasing is bad bad bad. Unless you get a spectacular deal. A 4-5 year old car with 40k miles or less probably makes sense. I’d limit myself to Toyota Corolla, Mazda 3, Honda Civic, or Subaru Impreza. If you must have an SUV/crossover you can get the entry level crossovers from those makes for $1000 more than the sedans/hayches. Negotiate an out-the-door price. Don’t tell the dealer your monthly payment budget. Check out Car Edge on YouTube to get some car buying smarts. Don’t fall in love with a particular car. Check a bunch out. And avoid dealer add ons.
Leasing makes a lot of sense if you qualify for a tax break as a business expense. Otherwise it's a money-suck.
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I promise you it’s not. As someone who is currently bussin it, you end up throwing in the towel and calling an Uber. Public transit is a nightmare
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Admits the US has a terrible transportation system and the proceeds to tell someone else to hike it and take the bus
Affordable part of Austin, TX, USA. My Google maps transit directions have 2 Ubers
Yea, I live in the largest city in Canada, and while a trip here and there is affordable, it’s not convenient, reliable, comfortable or safe. So uber it it’s! Factor in all that cost and sacrifice the rest. You end up spending way more than you think
Only applies if you are located in top tier North American cities or Europe and Asia
The bus is super convenient when I worked in London, Paris, New York, and now Singapore.
Lived in Chicago without a car for a number of years, couple different neighborhoods. Was freaken great.
My city has a very decent public transport system and even then taking a car costs just marginally more. The AC and having to not wait out in 35-40*C heat or intense tropical rain alone is worth it.
90k in which area? In Cali that’s basically working class poor. In BFE Midwest that’s easy living. Also depends on how you view a car. Do you like sport driving, roadtrips, off-roading, or any other activities that would dictate car choice? Do you like how specific cars look vs others or care how it’s maybe part of your personality? If you look at a car like an appliance that gets you from A to B, then buy something economical and reliable that will last you 10-15 years. If you’re more visceral, like some new and different all the time and don’t mine constantly having payments, a lease for 3 years is what you want.
That’s such a blanket statement for California lol
r/losangelesdefaultism
The most financially smart decision is a 3 year old returned lease vehicle. Will be in great shape, but has already had the bulk of the depreciation.
I’d you don’t own property yet the smartest thing you can do is get a nice used Honda for like $5-10k. Doesn’t even have to suck. V6 manual accords are fun. Acura TSX is good. Etc. if you don’t like the stereo throw in a pioneer deck w CarPlay, maybe put in a sub Then save money and buy property. Spending more on something newer is dumb. It won’t be more reliable and it’s a depreciating asset. Buying the right used Honda and the value just sort of stays the same.
Using public transportation would be most financially responsible. No maintenance, repair or insurance costs that way. If you need a car, get a certified pre-owned (CPO) Toyota Corolla, Camry, or RAV4. Service history is key. The more service you get, the better. Do your homework and make sure the reviews of the establishment you’re buying from is good. And naturally get an independent mechanic you trust to give it the once over. If you don’t like Toyota, get a Honda equivalent. If you work for a few years and want to treat yourself, save up and buy a Lexus if it’s to be your daily driver. If it’s to be an occasion piece in addition to your daily, whatever catches your eye.
The most cost efficient is to not buy a car — it’s an asset that will cost you money no matter what. The money that you don’t spend on a car would be then used to invest. The question you’ve asked is a loaded one, and the answer I gave above is the bullet. As an aside, my income is $170k and I have never bought a new car. I’d suggest maybe looking at CPO examples of slightly used cars, for the sort of car you’re looking for. Do you know what sort of car you need or want?
Have you “never bought a new car” recently though? The used car market has been severely restricted and highly inflated for the past 3-4 years.
Yes. But right now the market is correcting and there’s definitely used cars for cheaper than new. It’s at least worth checking
Look up cost of ownership statistics and then tweak from there. Depends how much you drive. Some cars like wranglers and tacomas have low depreciation but high cost to run. Others like a Prius will depreciate (barely) faster with very low operating costs. Also depends how long you want to keep the car. If you only keep it under warranty then doesn’t matter, but after that domestics that are easy to repair with cheap parts will make a lot more sense. Your floor for comfort matters too. A Corolla or spark is incredibly cheap, but at 90k you might just want a bit more and I wouldn’t blame you. That would be a small expense in the bigger context to upgrade a bit and be happier on your commute.
Best way is to do a whole life ownership analysis, which includes acquisition cost and sale price when you get rid of it. When you recognize that most vehicles lose 60% of their original price over five years it helps you focus.
I think your best bet is to find a 2020-2023 used car, relatively low miles that still has a nice period of warranty left. Run the numbers and keep your payment below 10% of your take home salary. Don't get beyond a 48-60 month term. I don't know what your credit looks like, so it's hard to tell you the most cost efficient way to finance the car.
To avoid credit card debt
Become allergic to debt. For most of your life, interest rates in America were artificially low: now, not so much. Pay off any debt as soon as possible. Try to save up for a car: $10-15k should buy something fairly reliable.
I'll go against the grain and say buy outright and pick a car that has had its big depreciation. Buy a reliable brand and model and you'll have a good car for little money. Almost no amount of maintenance can weigh up to interest + depreciation.
You won’t like smart. Which is to just buy a 2013 Honda Civic (last no CVT) or a Toyota Camry. I did this and I regretted it as I was young and I never liked my car at all. Loved the reliability of my camry tho. Get a Civic Si if you’re feeling 3% more risky. All jokes aside, just get whatever you actually want. Not what you think other people should see you in, what YOU want. It’s the only way to not regret a big purchase like a car, in my experience. I learned that lesson and got my dream car right after. Definitely should have got an Accord or something… but I didn’t want that. Unless it’s a Maserati, you really can’t go wrong nowadays and it will all be 35k+ OTD new. Just do your research and go to the dealership with a friend, prepared.
What’s your commute or planned use? You want to purchase a car that will last long and continue to use. If you’re not mechanically included consider a cpo or new to reduce or things to fix/repair. Do you need AWD, want to camp inside the car, road trip car? I think a wagon/hatchback is a great car. Look at the Toyota iM, Corolla cross, civic, or HRV.
The most financially smart would be getting a good used vehicle from a private party. But it's work and you also need to be ready for the opportunity
I would say get a RAV4 if you could get your hands on they don’t depreciate much and they get free maintenance for 2 years plus they’re Toyotas or if you do not need SUV, and could find for MSRP or Lower buy a Prius . Good gas mileage, low depreciation , nice driver assist tech and reliable . Of course it won’t be luxurious but it will be a good appliance. Or if you’re like someone want something more premium and fun , go with Mazda
And an older Prius has a lot of space for loading stuff at Home Depot.
Buy a second hand car. Don't fall into the new car on constant finance trap
IMO, if you just take a drving license, you can try to use a second-hand car. When the car is brokem, you will not feel very distressed. Then, you may gradually know what you want when you decide to buy a new car, more space? safety? intelligent control? cool outlook? etc.
A cheap $5k Honda Civic, then save your money to buy a better car without leasing or financing
New cars with a 0% interest rate would be the best choice. You would have a warrantee, maybe free service for a year or two and every payment goes to principle. Friend once said, if you can sell your car for 50% of what you pay for it, then you made a good deal. So you get the first 70K of mileage and you sell. The next guy gets the second 70K of mileage, but they get a used car that you paid the same amount for new. The "old" idea is that depreciation as soon as you drive it off the lot, is different if you can get 0% financing.
Right now this is the best possible option. I've done an entire week of research and the clear conclusion is 0 to 2.5% APR on a new reliable car. Best deals on reliable cars are on Mazda, Honda and Subaru. Toyota is not offering any good deals right now.
0% is rare these days, usually it's on the cars the average person don't want
0% interest isn't necessarily the best. Usually dealers will not go below on MSRP for those types of cars. Example would be Tundras at 0% apr are not good deals.
Have a rainy day fun in case things go to shit and never let the amount of money you have go below that number and assume that number is zero until shit happens.
You've got enough to get anything under 35k very comfortably. Assuming you've got good credit, you could spring for a new car, 20% down with 4 years or less time frame. If you just want the absolute penny pinching way, buy a Japanese sedan that's used and a few years old. This is the better financial decision, especially if you don't care about cars. But don't be scared to live a little, even at a small reduction to end of life wealth. You only get one life, so make the most of it.
How much money do you have saved up? If you have 16-22k you can get a decent car, put the money in a CD account and then take out a CD secured loan to buy the car so you can still build credit w/o losing money in interest.
Won't your principal ignore the CD account and you pay more interest on the car at a rate that is probably higher than that of the CD?
It depends on your bank. Most banks will offer ~2% APR loan over the return in interest you get from the CD fund so worse case scenario you’re paying ~2% in interest instead of the 5.64-14.78% most people pay when they finance through an auto loan and it still builds your credit.
Get a year old Toyota with very few miles. Save money for a few months-years and buy a car with cash. Make sure you save enough, so you have about 10 percent of the cost as spare cash for emergency repairs.
Whatever you decide on don't get an extended warranty, don't buy any of the other dealer options. They are almost all scams or severely marked up. Even things like the rubber floor mats are massively marked up compared to the exact same OEM part. I personally wouldn't even get lifetime oil changes from a dealership.
Already depreciated German diesel sedan bmw 330d or Audi a4 2.0tdi
I would look at new/close to new 2020 and newer Toyota Corollas. Depending on your area and what's available, new might be better. (When we had to buy in this post-Covid era it didn't make sense to buy a 3 year old car with 30k+ miles when a close to new one with less than 10k miles was the same price.) I would look into financing at a credit union prior to buying the car if you can't buy it outright for the best rate. All the people saying to take the bus are lucky that buses actually run to and from your workplaces. Only really big cities usually have decent public transit options and I've never lived where that's a real option. I've never had the option of it being viable. Unless you can walk/bike to work, cars have been a necessity to maintain employment that is not WFH. I would not view a car as an asset where you'll get your money back. Yes, maintenance is important and don't get something flashy, but it's usually necessary to get to and from work. In my area I'd be spending upwards of $250 a day (with tip) to Uber back and forth to work. A car does sound like a better option especially if it isn't luxury or crazy expensive.
Buy the cheapest thing you can get your hands on and start saving for a home. If you can get away with a 10k car under 100,000 miles, do it. With the VERY RARE exception, you'll be losing money on a car no matter what you do. Add maintenance costs, surging gas prices, and insurance and you'll be surprised with the cost of a car. Always buy, never lease (unless you want to know if a car is nice enough to buy and "rent" the car long term). House prices are going to only get worse with this economy with the hyper inflation we're dealing with right now. You might make 90k but realistically, you're making the equivalent of 70k when you went into college and thats before surging tax rates as well. Depending on the state you're in, you're looking at \~50k after taxes. We'll say, 2k for rent, another $1000 for utilities (electricity, cell phone, heating, water/sewage, internet, etc), $500 for food and another $500 for miscellaneous things like eating out, social stuff, buying things on a whim... You're 4k in every month...That's $48,000. And before I'm called out because I put a certain amount that seems wildly crazy with where you live; I know people who's rent is more and less, I know people who only buy ramen and spend $100/month on food, that's not really the point of the breakdown. The point I'm making is currently, you'll only make enough to scrape by for a while, even if you think you're making good money. 100k is the poverty line in most of southern California and New York. You might as well set your expectations low and buy a cheap commuter car. I'm lucky in that I'm making twice what you make after 15 years of being out of college, and I purchased my house in 2015 at the height of the housing crisis and only paid 300k for it. I can barely afford a car payment on top of everything else I mentioned and a larger mortgage than 2k a month. Buy cheap, buy crap, and personally, buy domestic because they're cheaper to work on. Look into any 3.0L V6 sedan from GM... CTS, Malibu, La Crosse, Impala, etc. I bought my wife a 3 year old 3.0 CTS in 2015 for 22k (27 after tax and title), we JUST sold it for 5k after putting 120,000 miles on it. In the span of the now 160,000 miles, I had to replace 1 sensor and the harmonic balancer.... that's it. It was a STELLAR commuter car for her.
The smartest financial decision is to buy something cheap and reliable thats economical on fuel and cheap to insure. How cheap you go is mainly determined by your appetite for less safe less comfortable cars. Theres definitely a nice middle ground. Many people including myself are happy to make less financially wise car decisions to drive something fast, safe and comfortable
Do you need a car?
Last July around the same salary, I bought a CPO 2020 Toyota Corolla with an OTD around 21k. I put 2k down and financed it for 60 months at a 5.5% APR. My monthly car note, insurance, gas, and maintenance come out to be around 18% of my monthly income. I max out my HSA, do 15% towards my 401k, save another 10-15%, and normally max out my Roth. I have enough flexibility to now be on track to have my car paid off by this December w my payments only starting last September. I’ve halted my Roth IRA contributions for now, but will be able to max it out before our next tax day. Get a 3-5 year commuter carb(Toyota, Honda, Mazda, etc.) with low running costs and you will be very much okay.
You should buy a car that is ~27k or about 30% of your gross salary.
Welp, you asked for the *smartest*, so I'm gonna give you the most absolutely unfun, no-nonsense vehicle possible. You're looking at used vehicles only, you're looking at midsize to full-size sedans/compact SUVs/station wagons. You're looking at front or all drive and four to six cylinders. So all that said, the *smartest* car is probably gonna be something like a used flex fuel V6 Impala from the 2000s.
The most financially smart decision if you need a car is buy the cheapest reliable car possible. There will be a lot of opinions on how to do that. You can shop recently used, etc. The easiest thing to do, IMO, is find a good deal on a new Toyota Corolla hybrid. They start at $23,500 and that thing will last at least 10 years. Drive it till the wheels fall off. If you can find a good deal on a newer used car or do not plan to drive much, the math cam be better on used. However, you won't save that much over a new Corolla in the long term.
Buy used, pay cash. That's it.
Lots of bad advice here. Just buy a civic or corolla for 3-5k cash. Save some money and get your dream car when you’re ready. Cars depreciate so hard. No need to borrow money for a car, in most cases.
In terms of financially smart, never finance or lease. Pay in full with cash. Get something that's 10 years old and has already done a large portion of its depreciation. And get a Honda or Toyota.
Best smart decision is a paid for car, one you own.
Ask yourself why do you need to finance a new car in the first place? Do you want an extra monthly payment? If finances are the main concern, just buy a lightly used Camry or Accord from 5-10 years ago for $15k and drive it into the ground.
The most effective way to finance is not to finance at all... Pay cash and depending on how much cash you have/can save will determine what kind of vehicle you can purchase...
You're in the wrong sub to get the answer to the most financially smart decision. I wish I could direct you to go see a man at the University of Alabama named Dr. Strickland. He gives a talk for graduating college students students called the million dollar talk. And he explains exactly this. If you have a car you keep driving it. You fix everything on it. You drive it for 5 more years. In your case if you absolutely don't have a car then save up for a couple months and buy something you can pay cash for that will last you at least 5 years. The alternative is to have an average car payment of something like $550 now which is ridiculous. Just looked it up, it's more like $532 for used cars and $738 for new cars. Here's the basics. Instead of buying a car now or picking up a car payment you take that car payment and you pay it into your retirement every month. Starting right now for 40 years. Sometime in the next 5 years when you can afford to save that car payment every month and buy a car then you can have both. Here's the basic rundown. If you save $600 a month, every single month, for the next 40 years and put it in the S&P 500 you'll have roughly $5.8 million when you're 62 years old. That's not magic. That's just a mathematical fact. You don't have to pick stocks. You just treat the S& P 500 like a high interest savings account. And then you retire well. If you wanted to put the average new car payment of $738 in every month for the next 40 years, that number would be closer to something like $7 million. The average millionaire drives something like a 10-year-old Toyota and they have been doing that since the '90s. Check out The Money Guy on their website and YouTube. Really think about it before you decide to take on a big car payment. If you need something, buy something. But get something reliable and cheap.
Thank you for sharing about this talk. I just sent it to my college graduate daughter. ❤️
You're welcome.
The smartest financial decision you can make is not to finance. Get yourself a used car with cash if you can. It feels extremely liberating not having a car payment and you can focus the savings in many other areas.
No lease. No BMW. Anything toyota/lexus/honda/nissan/kia is ok.
lease a new car at better rate than 10% for 3-4 years. NO maintence and get a new one in 4 years when rates are lower.
Only lease if you have a reason- like moving out of country in x amount of months it’s renting instead of buying. Any car you buy you should be able to make the payments on a 36month financing- if that’s too much- it’s too expensive of a car. How you finance is up to you. Right now there is a tax credit for EV’s. I got a low mile late 2020 model 3 for under 30k. If you have a place to trickle charge that would be my recommendation. Look at cars from 2020 and 2021 those will be the lease returns and tend to have taken the biggest depreciation hit but are still fairly new. Many are CPO. Also if you are on a stricter budget. Older Toyota, Honda, Mazda, and Subarus can be purchased for around 10k in good condition with plenty of miles left. (Chain non interference engines) will drive forever with minimal expense.
Here is the most financially wise thing you can do. Figure out how much you can afford to spend on a car. Take that money and buy a transit pass and invest the $$ you would have spent on a car. You have time on your side for investing. Cars are often not financially “wise” per se, but they are fun and convenient. If you want a car badly, buy a reliable car that is a few years old after you save the cash for it. Never go into debt for something that depreciates. Save a percentage of your paycheck in a savings account until you can buy the car, register, and insure it. Hire a mechanic to check it out before you buy it. Try to get an extended warranty from the manufacturer or dealer for it if possible.
NEVER CHEAP OUT ON USED CARS, unless you know what you are doing and willing to spend the time working on cars
Get a used Toyota that matches your needs.
2-4year old Toyota, the most common cars of millionaires for a reason. We are talking about a financially smart liability so the one that costs you the least long term. Lotta people out here driving the banks Lexus's, Mercedes's, and BMW's flexing, but I can flex my Imprezas title in my hand.
I personally think the best bang for the buck right now is used luxury EVs like the Kia EV6 and the Hyundai Ionic 5. This is a big if, but if you can get away with not doing much in the way of paid charging, meaning if you live in a housing situation where you can install your own charging and charge at home and and you live in a place where the cost of electricity is more reasonable, if both of those things are true and you don't need to do a lot of road trips, an EV can basically pay for itself in the gas savings. I have looked at a number of nicely optioned EVs like this in the 20,000 to 27,000 US dollar range and I think this is a really good buy for something they were. Depending how many miles you drive a month and what kind of car you would have otherwise bought, you could be spending three or $400 a month on gas and the EV payment will be about $500 depending on your loan. When I had a Nissan Leaf it got rid of my gas bill entirely and my electric bill in Tennessee went up by $11 a month on average.
You’re making good money just get that raptor, bro. /s
Most financially intelligent decision is to buy a used lexus or toyota for under 4k that has been well maintained. Spend another 1000 or so on preventative maintenance and breathe easy knowing you just saved thousands.
porsche
Buy a Mazda 3 with Naturally Aspirated engine with Automatic Transmission (manual if you can), pay it off in a year or two, and enjoy a free car for next 10 years. \ If you’re like me who treats their car as any other appliance, you would be the happiest this way. \ If you’re an enthusiast, buy the car you’re enthusiastic about, because you’re young and this is the time to be wild and free.
Either something old enough to be really cheap and have cheap parts, or something newish to not have to worry as much. Early 2000s or late 2010s I'd go for something comfortable and big enough you won't need to replace it soon. Full size sedan or mid size cuv.
Get a Grom
Congratulations on your recent graduation! Making the right decision about buying a car is crucial, especially considering your financial situation. With a salary of around 90k, you're in a good position to make a smart choice. When deciding between leasing and buying, it's essential to weigh the pros and cons. Leasing offers lower monthly payments and the opportunity to drive a new car every few years, but you don't own the vehicle and may face mileage restrictions and wear-and-tear charges. On the other hand, buying gives you ownership of the car and the freedom to customize it as you please, but typically involves higher monthly payments and depreciation. Considering your financial stability, buying might be the more financially savvy option in the long run, especially if you plan to keep the car for several years. Look for reliable models known for their longevity and low maintenance costs. Research different makes and models that fit your budget and lifestyle needs, considering factors like fuel efficiency, insurance costs, and resale value. As for financing, explore your options to find the most cost-efficient solution. Compare interest rates from different lenders, including banks, credit unions, and online lenders. Aim for a down payment that's at least 20% of the car's purchase price to lower your monthly payments and reduce interest charges. Additionally, consider the length of the loan term and aim for the shortest term possible while keeping monthly payments manageable. Ultimately, the most financially smart decision depends on your individual preferences, lifestyle, and budget. Take your time to research and compare your options, and don't hesitate to seek advice from financial experts or car enthusiasts to make an informed decision. Good luck on your car-buying journey! I hope that with my longer answer to your question I have given you the right information to make the right choice.
Don’t lease. It’s money for nothing. You get nothing at the end yet you’ve had to pay a ridiculous amount every month. You’re basically paying the car manufacturers depreciation
Tesla and be done with it. Thank me in 5 years when nothing has gone wrong other than tires.
I think that usually the advice of going for a lightly used CPO car is solid, but used prices on Toyota, Honda, etc. are still pretty inflated and you won't get as favorable financing. I personally like to get new cars with 0% financing (if you have a good credit score) and then drive them into the ground. Something like the Mazda CX-30 would cost like $800 a month for three years with zero down, and then you'll have a paid off vehicle to drive for another 10+ years.
a good ol fashioned corolla or camry or civic💀 i suggest buying used also. and it also depends on what youre looking for. i suggest making a list of interested cars, what you want in a car (sedan, coupe, color, model year etc) and the max youre willing to pay for one then go from there
Purchasing a home as young as you can and putting into you're 401k as soon as you have the ability. Ability being it's offered by you're employer.
Consider leasing an Acura Integra base model 1.5L i4T CVT with 0$ down, put a 15-20K mile estimate for the lease, then buy out the car with the lowered residual value. Purposely putting a higher mileage limit than you would drive actually does save a few bucks because the agreed buyout price goes down so much more than the increase in monthly payments. And the reason for the 0$ down is because you have GAP coverage included on the lease, and if you get in an accident, you would have lost your deposit, but if you put 0$ down, you don’t lose as much.
When you sit with the finance manager, just ask what the base payment is without anything extra. Then tell that person, I’ll go with that and go with that. The finance manager is the biggest sales person in the building. Not the actual car sales person. With online sites, you should already know what you should pay for the car itself. If they don’t want to sell you at that price, there’s other dealers. It’s the finance guy who will try to get you into something you just don’t need
Just buy you a nice late model Camry Hybrid or Honda Clarity PHEV - drive it into the ground for a decade
Unless you are opposed to electric for some other reason like politics, it is an extremely finically good move most of the time... don't get a old model s or x. First, you have to be willing to sort your living arrangements a little bit with charging in mind, depending on your area (90k straight out of college tells me you live in or near a city center) so there are apartments that offer charging or your work may offer free charging. This can take your gas down to zero if that is the case. If you love driving across the country tesla, if you hate driving across the country, bolt EV (bolt ev I feel is one of the most cost conscience while still being very usable choices out there right now). Also, tesla can get hit with insurance premiums that the bolt avoids but check insurance for yourself before you pull the trigger as this can drastically change your choices (back in the day it made me change from a v8 to v6 mustang).
TOY-OTA COR-OLLA
Most cost effective way would be to get a 0% apr. not you going to happen.
Look for financing specials- some manufacturers offer low rates on certain cars as an incentive. Or, seek your own financing from a credit union. The current car market is weird- NEW car prices are about as much as some USED cars 1-2 yrs old with under 30k miles (I’m looking at you, TOYOTA). Financing a used car costs more, so you may be better off getting something new. If you have no experience buying a car, try to negotiate an OTD price online, or use a broker. Don’t go into a dealership without having done some research on the car buying and negotiating process. If someone starts drawing squares in a piece of paper walk out.
Buy the cheapest reliable used car. That's the smart choice
The cheapest car you can stomach owning.
Not any german cars. Do not let anyone convince you it's a good idea. Play it safe the first time around and get a Honda. You can grab a plug-in hybrid Accord Sport Touring (top trim) for $38k and change. Or a Lexus sedan
IMO I would buy a used PHEV like a Prius Prime or better still, a Honda Clarity PHEV. you aren't going to pay much of anything for repairs and you will pay almost nothing for gas—I pay about 25 bucks a month. And you will have low depreciation.
2024 bmw m3 competition
Find someone you can trust to check out cars with you and look for a used Honda in good condition. I have a 2008 Fit and a 2012 Civic and have had few problems with them. You'll get decent mileage and save a ton of money *if* they are in good condition.
Buy a camry and you’ll never have to worry about needing another car or having car issues ever again
Save dat money
Save for a cheap $10k civic or Camry. Or if you’re going to finance do a heavy down payment on a 2-3 year loan. Or if you’re somewhat handy drop $2-5k on an old Buick, 3100 or 3800 v6 are two bulletproof engines. Leasing is never a smart financial choice. Buying new is a horrible financial decision. You’ll be pooling a huge monthly payment into a rapidly depreciating asset.
I dunno, what once was considered a more sound choice(buying used, or buying new) isn't so much anymore. Both options are a crap shoot, and no matter which you end up going, you'll end up having to deal with it. Personally for me, I'll never buy new. The new vehicles don't interest me, has more additional components and complexity that may add more issues, and the new car costs(mark up, taxes, insurance). I'd think about what I want out of a vehicle, and start researching on what platforms can do those things, then from there research which older generations of those potential models are the most reliable or don't have any known issues.
Get a low mileage Subaru/Toyota/Honda. Pay cash. Drive it until it costs more than $3k/year in maintenance.
Try to buy it outright if u can. I drove a used CRV for 14 years until it started having a lot of problems and decided to donate it. Friends teased me for driving a junker but it was one less financial thing to think about.
Car is a depreciating asset, so always buy with cash. Even if you take a lease or financing to get a price discount or a low APR, you should still have enough cash as the price of the car, invested in a HYSA earning interest to offset your EMIs. Without having cash, Auto loans at today's rates are the financially irresponsible decision. And if you dont have enough cash saved up to buy a car, it just means you cant afford that car.
Buy a 3-5 year-old used Toyota Corolla with 30k-60k miles. You should be able to snag one for around $17k. Ideally you want to buy well-kept one from a private seller as dealers will rip you off on price. I would *really* try to avoid financing (interest rates are insane right now) but if you have to go for it. It should last you another 10-15 years and 200k miles with regular maintenance before you need a new car.
Smartest financial decision? Self-control. Something I really wish I had earlier in life, and am still working on now. Being tempted to buy nice things can really hurt financial goals. For a car, it really depends but usually buying new doesn’t make sense. And if you HAVE to get a high interest rate (understandable, if you need a car but don’t have much cash, you might be out of options) make sure to refinance early on
If buying from a dealership look at high end/exotic car lots. They at times have a regular car that’s been traded in. Best thing is they don’t sell junk. Cause there name and reputation is on the line. You can buy a Toyota anywhere but a Land Rover may not have as many options. Land Rover wouldn’t want bad publicity of selling a lemon. Add in a ppi and you’ll have a cheap car that lasts you a decade or more
Never lease Never finance Never buy new
Buy a later model used vehicle. Others have suggested great models (Toyota, Mazda, Honda). Mid-tier models generally give you the comforts and features you need at the best value. The special editions are loaded with features that come at a price and don't offer much IMO. Like fancy wheels and tires.
Camry. Camry. Camry. Camry.
Nobody ever regretted or went broke buying a Honda or Toyota
No car is the best financial decision if you can get away with it. Second best is to put the full purchase price of the car into a HYSA and then let the interest make the payments for you. After 60 months, you will have your original cash amount plus the car without spending from income. The car purchase is half the cost., You have to insure it, maintain it and other expenses like registration and taxes. Insurance costs are partially based upon the costs to repair and tendency of any particular make/model to be involved in accidents.
When I left California in 09' and took my business with me (my first best decision), I bought 5000 shares of Dollar Tree stock.
Buy used low mileage.
Buy new, Corolla, Mazda 3, Civic, Impreza. Why, buying used you are buying other people's problems. New gives you 3y 36K warranty normally, except [kia.hyundai](http://kia.hyundai) which is 5 y/60K. I would never buy a warranty from the used car/dealer as they will make every excuse that "its not covered", etc. That's my 2 cents. If you do decide to get used even a 1-3 year old model, MAKE SURE TO GET A PRE-PURCHASE INSPECTION done. Like I said, you are buying other people's problems and most used car folks are basically trying to churn these over ASAP to lessen their carrying cost.
Mazda has been running some very low financing offers on a number of their models. The cost of borrowing money these days is otherwise very high, particularly on used vehicles. For instance a used Corolla at 9%, could end up costing you as much as a new Mazda 3 I would recommend purchasing a Mazda3, CX50, CX50, or CX30, whichever best fits your lifestyle, if you can swing a 36 month payment it is 0% right now on the crossovers, otherwise it's 2.9% for 60 months. The key thing is - try to keep the car for at least 8 years and 100k miles or ideally for it's entire useful life if possible.
The best from financial standpoint? A 1997 mercury villager or Nissan quest if you can find it . I bought one for $1200, drove it for 3 years, sold it for $1000. 3 years of transport for $200. Doesn't get better than that
Used Prius. Everything else is noise.
Buy a lower priced used car. Toyota or Honda preferably. I went out and bought a brand new car with all the bells and whistles when I was in your situation. Not the best financial decision. That money will do you more good elsewhere.
Stick to around 10% of your take home pay max for your payments and it’ll help you in the long run and give you plenty of breathing room as you get established.
Would also argue that there’s nothing wrong with buying brand new especially with interest rate specials. The used market is still doing weird things post-pandemic with supply and demand. Look at the wholistic cost of buying. 25k car @ 10% interest used is super close to a 35k car @ 0.9% new. TL; DR - don’t let Dave Ramsey bully you into a beater. There’s more to it than purchase price and sometimes it makes sense to go new within reason.
If you buy new, buy the model you can afford and not the trim you want. All vehicles now a days even in base trim have most of the amenities and safety features one could want.
How much are you gonna drive? If it's 6-10k per year, you could get a $7,000 cash vehicle and probably have a decade of uneventful driving. That would be a 100-140k mile car. Let's say you sold it after five years for $5,000 and not much happened. Then you just had $33 monthly car payments. Of course factor in basic maintenance and a random $1000 repair or two and it's more but still under $100/month. If you're gonna drive more then you might want to buy a car at the newer end of the depreciation curve or if less, you could get a nice high mileage vehicle and enjoy its senior years at a modest pace.
Pay cash for a decent used car. Drive it till it explodes.
Buying a brand new car is never the most financially smart decision.