Buy vs. Lease?

[jus711]

What if your in a different situation where you have the cash but not the income?

Unfortunately, due to some recent deaths in the family I stand to inherit roughly $2-300K. I recently graduated college with a BA from a top-ten school (Washington University in St. Louis). I don't as of yet have a job but I'm sure I'll find one soon, at least by the time the 135i comes out.

Now I realize that purchasing a car is a bad investment and that I don't need that much car, but I would like one. Given that an entry level job is likely going to put me in the $30-40K a year range to start, is purchasing a 1er--outright--really that bad of an idea.

I am recently married--my wife just graduated as well with a master's--I pay relatively low rent and I don't have many other expenses. Yes I know I need to save for retirement, down payment on a house, kid's college, etc. But I can do that with the money left over, no.

[Templedogg]

House should always come before dream car!!! If you rent and own a $40K car it is silly to me IMHO.

[ibeam81]

Originally Posted by jus711

What if your in a different situation where you have the cash but not the income?

Unfortunately, due to some recent deaths in the family I stand to inherit roughly $2-300K. I recently graduated college with a BA from a top-ten school (Washington University in St. Louis). I don't as of yet have a job but I'm sure I'll find one soon, at least by the time the 135i comes out.

Now I realize that purchasing a car is a bad investment and that I don't need that much car, but I would like one. Given that an entry level job is likely going to put me in the $30-40K a year range to start, is purchasing a 1er--outright--really that bad of an idea.

I am recently married--my wife just graduated as well with a master's--I pay relatively low rent and I don't have many other expenses. Yes I know I need to save for retirement, down payment on a house, kid's college, etc. But I can do that with the money left over, no.

It's your money and your choice. I would hold off on the car until I had a job, but you can afford it. I would definitely save some of the money. Just do what you and your wife think is best.

[TESLAASTRO]

Originally Posted by Tijuana

What if I don't have kids, own my own home, shun credit cards, and don't like caviar or cable television? That's certainly different than a young couple that just bought their first house, has a ton of student loan debt, and a baby on the way.

Even the second scenario depends. The cost of living in SoCal or Miami is significantly higher than it is in middle-of-America. Would $250,000 be enough if your first house cost $800,000? What if it was only $100,000?

But this is an car enthusiast web site and not a financial planning web site. A lot of people on this forum are going to be making bad financial decisions, but smiling nonetheless.

Comment was for OP and anyone else viewing....meant strictly as an opinion...Any resemblance of my comments to any persons living or dead is purely coincidental...As such, I don't understand your point in the above quote...I never made any reference to housing, and i don't like caviar either, but apparently Roger Waters does...Nevertheless, if you are fortunate enough not have the encumbrances you describe above,yet are not making the $ to support that purchase , 'in my opinion', ya shouldnt be buying that car...my point all along, which, as you can see a few posters agree with, is live within your means.....How boring would this site be if we just wrote about specs and colors and pricing deliberations ad nauseum? I'm glad the moderators are cool enough to allow me to veer ever-so-slightly off topic now and then......

[TESLAASTRO]

Originally Posted by Templedogg

House should always come before dream car!!! If you rent and own a $40K car it is silly to me IMHO.

oh you are soooo right......20k for car, extra 20k in home equity.....now is the time to buy real property....

[Smokey]

Tijuana says:
But this is an car enthusiast web site and not a financial planning web site. A lot of people on this forum are going to be making bad financial decisions, but smiling nonetheless.

[Garrett]

Originally Posted by TESLAASTRO

'New car, caviar, 4 star daydream, think I'll buy me a football team'

Tijuana, listen to Pink Floyd's 'Dark side of the Moon' from start to finish.....everything I ever wanted to know about life, put into crystal clear perspective, is all there"

Follow that up with Pro's and Con's of Hitchhiking, then Roger Waters solo slbum Amuzed to death.

Both of those will give you knowledge on life.

[TESLAASTRO]

Originally Posted by Tijuana

But this is an car enthusiast web site and not a financial planning web site. A lot of people on this forum are going to be making bad financial decisions, but smiling nonetheless.

True, but after 2 years, and the smell of the leather (or leatherette) has faded, and that $750.00 a month albatross in your driveway is a constant reminder of whether or not that bill or the electricity should be paid , 'cause you don't have the $ for both......I wonder A) how many on this site will be in that situation, or have ever been (I was once) and B) If they'll still be smiling without "artificial" stimuli......

[TESLAASTRO]

Originally Posted by Garrett

Follow that up with Pro's and Con's of Hitchhiking, then Roger Waters solo slbum Amuzed to death.

Both of those will give you knowledge on life.

funny you should mention Pros and Cons...just read Clapton's autobiography....I never knew he played on that album and went on the tour as well....

[Tijuana]

Originally Posted by TESLAASTRO

...my point all along, which, as you can see a few posters agree with, is live within your means.....

I understood and agree with your point. The point of my original post was that as American's, we can't be expected to think logically about what we can and cannot really afford. The underlying principal of my argument is not a sound one and was meant sarcasticly, but it makes for good discussion.

[Smokey]

TESLAASTRO says:
True, but after 2 years, and the smell of the leather (or leatherette) has faded, and that $750.00 a month albatross in your driveway is a constant reminder of whether or not that bill or the electricity should be paid , 'cause you don't have the $ for both......I wonder A) how many on this site will be in that situation, or have ever been (I was once) and B) If they'll still be smiling without "artificial" stimuli......

You made some valid points, but the significant number of people on this forum are still young and have few financial responsibilities. While I would not dream of buying a $40,000 bmw if I were making only $30,000-40,000 a year, I don't feel it's my place to tell others how to spend their money. Sometimes, people have to learn from their own mistakes-- it's part of the growth process.

[ARES45]

Well this post took an interesting turn. There were some definite generalizations made that everyone has a traditional situation. Mine is different and I dont happen to make 100k a year but do luckily have no real expenses to worry about except vehicles, insurance, and minor bills, and some investments (military for career not married or having children). I also lived with a car that I had paid off for 7 years (and is still running strong) so that I could afford the vehicle I that was exactly what I wanted.
But this wasn't really about if I should buy a vehicle or if I can afford it (worry not I do budgets as a hobby), it was about benefits of leasing or buying and I have appreciated all the comments on topic and even the financial advice.

[Tijuana]

Sorry for the derailing.

I think a few people answered your question, but I'd say if you kept your last car for so long then buying is probably a better option.

[ibeam81]

Originally Posted by ARES45

Well this post took an interesting turn. There were some definite generalizations made that everyone has a traditional situation. Mine is different and I dont happen to make 100k a year but do luckily have no real expenses to worry about except vehicles, insurance, and minor bills, and some investments (military for career not married or having children). I also lived with a car that I had paid off for 7 years (and is still running strong) so that I could afford the vehicle I that was exactly what I wanted.
But this wasn't really about if I should buy a vehicle or if I can afford it (worry not I do budgets as a hobby), it was about benefits of leasing or buying and I have appreciated all the comments on topic and even the financial advice.

Sorry, but this did go a little off track. I hope that I didn't come off as overly judgemental.

Anyway, in your situation I say go for it. It's a little ironic, but when I was a junior officer at Bragg over 20 years ago I didn't think twice about picking up a loaded 325e. It's funny, but now that I'm older and married with 2 young daughters I would think twice.

Enjoy your new Bimmer and thanks for serving our country.

[ibeam81]

Originally Posted by Tijuana

Sorry for the derailing.

I think a few people answered your question, but I'd say if you kept your last car for so long then buying is probably a better option.

Yup... If you plan to keep the car then buying is definitely cheaper in the long run.

[ARES45]

I would buy for sure, but I worry about deploying and making payments on a car I can't drive as well as being stationed overseas. Not to mention I question long term reliability, that was one of the reasons I've kept my car for so long, 'the best used car is the one in your driveway.' I really want to lease and then possibly buy if I feel the car is worthy, are there any other options? I have heard BMW has something in between leasing and buying but I cant remembered what it is called.

[ibeam81]

Originally Posted by ARES45

I would buy for sure, but I worry about deploying and making payments on a car I can't drive as well as being stationed overseas. Not to mention I question long term reliability, that was one of the reasons I've kept my car for so long, 'the best used car is the one in your driveway.' I really want to lease and then possibly buy if I feel the car is worthy, are there any other options? I have heard BMW has something in between leasing and buying but I cant remembered what it is called.

I guess if you're not sure about your situation then leasing might be a better option. I've wondered about the longterm reliability as well. Unfortunately the initial lease terms might not be that great.

Another point to consider is if you will be deploying overseas you'll have access to Military Sales, so it might make sense to wait.

[TESLAASTRO]

Originally Posted by Tijuana

The point of my original post was that as American's, we can't be expected to think logically about what we can and cannot really afford.

is that meant to be tongue-in-cheek?......youre stating that because we are Americans, we don't have the capacity to refrain from buying things?.....

[TESLAASTRO]

Originally Posted by Smokey

TESLAASTRO says:
True, but after 2 years, and the smell of the leather (or leatherette) has faded, and that $750.00 a month albatross in your driveway is a constant reminder of whether or not that bill or the electricity should be paid , 'cause you don't have the $ for both......I wonder A) how many on this site will be in that situation, or have ever been (I was once) and B) If they'll still be smiling without "artificial" stimuli......

You made some valid points, but the significant number of people on this forum are still young and have few financial responsibilities. While I would not dream of buying a $40,000 bmw if I were making only $30,000-40,000 a year, I don't feel it's my place to tell others how to spend their money. Sometimes, people have to learn from their own mistakes-- it's part of the growth process.

agreed 100%...which is why on every post I was careful to state IMO.....it's just an opinion.......personally, IMO I think someone earning 30-40k not only shouldnt be buying a BMW, but should seriously consider a slightly used Corolla, Scion Tc, or Civic - all excellent cars for about 12k....what the folks on this board do will not affect my life at all materially - but hey, I'm 40 and I've made these kind of financial mistakes when I was younger.....if 1 person who fits the financial profile I described makes a wiser financial choice, I think some good kharma would be generated....both for the person who's life would be spared stress and aggravation, as well as myself.....

[Garrett]

Originally Posted by TESLAASTRO

agreed 100%...which is why on every post I was careful to state IMO.....it's just an opinion.......personally, IMO I think someone earning 30-40k not only shouldnt be buying a BMW, but should seriously consider a slightly used Corolla, Scion Tc, or Civic - all excellent cars for about 12k....what the folks on this board do will not affect my life at all materially - but hey, I'm 40 and I've made these kind of financial mistakes when I was younger.....if 1 person who fits the financial profile I described makes a wiser financial choice, I think some good kharma would be generated....both for the person who's life would be spared stress and aggravation, as well as myself.....

+5

Though i don't think a used car is the best, specially when your just starting out. Better off going with a cheaper new car with a full waranty, etc.

I think for the money the new Ford Focus and Fusion are pretty damn good cars. The MazdaSpeed 3 is an exceptional little car, perfect for those just landing a career job and have alot of money tied up in new furniture, and home appliances.

I just love this photo:





How can you not like a 263hp turbocharged car, that comes with a Limited Slip Differential..?








-Garrett

[TESLAASTRO]

Originally Posted by Garrett

+5

Though i don't think a used car is the best, specially when your just starting out. Better off going with a cheaper new car with a full waranty, etc.

I think for the money the new Ford Focus and Fusion are pretty damn good cars. The MazdaSpeed 3 is an exceptional little car, perfect for those just landing a career job and have alot of money tied up in new furniture, and home appliances.

I just love this photo:





How can you not like a 263hp turbocharged car, that comes with a Limited Slip Differential..?








-Garrett

that car is hot...how much?.....

[Garrett]

Originally Posted by TESLAASTRO

that car is hot...how much?.....

I think it starts at $22k ..!