Taking all the fun out of buying a new car

[ChrisK]

This thread is so depressing, I may have to cancel my order! :eyebulge:

[Pac-Man]

Originally Posted by Nixon

Then again, the entire US economy could crash and burn at some point over those 45 years, leaving you pennyless AND without a 135i.

It'll crash and burn a few times throughout the 45 years but will always bounce back and then some...history dont lie.

You'll only be pennyless if you cash out the day it crashes... and of course nobody buys high and sells low

[M.Suka]

I will admit that I am a big spender but it only makes me work harder to accommodate my lifestyle and enjoy the things that I love like driving a BMW!

[slipkmaggot]

Originally Posted by Nixon

Put $350/month from age 20 to age 65 into a stock investment plan that beats the market by just 2% a year, and at 65 you will have an astounding $3,180,570 in your account.

So just agressive investment of your money that you would have otherwise spent on a nice car, and you could make yourself into a multi-millionare by 65.

yes save all your money until you are old and most likely not able to do the things you wanted to do once you had money.:iono:

[ScullyD]

Originally Posted by fuhgetaboutit

My dad once said that much of the money he has saved during his lifetime came from never buying a new car and always buying used. I've never been inclined to follow his advice, so my last car was (gasp!) a lease on a 325i.

I was reminded of this when I read this post from someone who obviously shares the same viewpoint of my dad -

"I only buy used and use the 4:30 rule. 4 years old, 30,000 miles max. Go on AutoTrader.com to find them.Alternatively, I needed a car for the kids. Nissan made a 240-sx convertible in the early 90's (Toyota made the Celica; both are good!). Went on AutoTrader.com and did a search of the US. Found a couple with 75,000 miles for around $5k. I've had one for 10 years & it’s been great, it now has 200k miles on it. With that mileage, they bottom out at around $2,500. That works out to about 2 cents a mile; new cars will cost around 25 cents a mile, 4 year old car is around 12 cents. A car is the #2 expense for most folks. The difference of 25 vs. 2 cents works out to $350/month. It’s equal to the after-tax debt service on a $100k mortgage (30 year, 6%). In other words, you can go with a new car or buy used & get a larger or better house by taking on an additional $100k mortgage. Wheels vs. house. I buy used and drive it until it's a donor. It’s a trade off and no one answer is right for everyone. When I see the Lexus commercials with the big bright bow, I see an economic noose."

Doesn't that just suck all the fun out of thinking about getting (gasp!) a new car?

While this person is busy sucking all the fun out of their life and "attempting" to suck the fun out of other people's lives, i'll be busy driving my 135i. I'm willing to go out on a limb here and guess that i'll be having more fun, but hey, you never know. :iono:

[edge350]

Warren Buffett once said he "almost died" when he found out that his wife spent $15,000 remodeling their home. He wasn't upset about the $15,000 per se. He was upset thinking about what he could have turned that money into in ten years.

He's EXAGGERATING in telling that story to make a point, the same point that Nixon made above about the value of compound interest. It takes a certain amount of maturity to appreciate that lesson. Not everyone has it. I didn't ten years ago. Back then, I just wanted to have fun, too.

If you're interested in thinking about this some more, here's a good place to start:
http://www.moneychimp.com/books/

[ARES45]

The world is ending in 2012 anyway. My BMW will still be under warranty when the apocolypse hits.

[1ster]

Everybody has their "thing". I had a boss once who prided himself on driving cheap used trucks... then plowed all of his disposable income into his lake house. Was the lake house a better investment than a car? Probably, but the real reason he did it was because he didn't care about cars and so it was easy to deride them as a bad deal. He cared a lot about his lake house and so he could justify those expenditures to himself.

Assuming you are spending within your means, there's nothing wrong with putting your disposable income into your cars. That's what they call it "disposable"!

[friscogypsee]

The world is ending in 2012 anyway. My BMW will still be under warranty when the apocolypse hits.

[pumaknight]

Originally Posted by Smokey

My personal philosophy regarding money is: save some; invest some; and spend the rest on things that make life comfortable, because I can't take a cent of it with me when I depart this world.

Cracking philosophy - I agree whole heartedly

[Thud]

Originally Posted by Nixon

So just agressive investment of your money that you would have otherwise spent on a nice car, and you could make yourself into a multi-millionare by 65.

Then again, the entire US economy could crash and burn at some point over those 45 years, leaving you pennyless AND without a 135i.

The answer is that it is all about balance. The Zen of Money.

Right... it's amazing when you figure out that if you just invest everything and live on Ramen noodles and drive beat-up used Civics until you're 65, you'll have eleventy billion dollars in your account by retirement! And then what happens if you have a heart attack and die right when you retire?

You have to save intelligently, that's for certain. But you should also make a point to reward yourself in the near-term, because life is short, and you never know what's gonna happen.

[RockChalk135]

Hi all,

First post :-) - this is to help me justify too...

Basically, I am not sure how the ~$3M figure was calculated, but according to my calcs (being a Finance major), it is much less than that.

Using a simple compounding calculator, the future value of saving $350 a month, earning 8% the total amount would be $1846088.96 in "future dollars".

In today's dollars, that would be equal to roughly $85,000. Please note, I haven't accounted for inflation or taxes, so it is probably even lower.

Seems like a good amount of fun before I go.


Disclaimer:
Please realize that these numbers are very rough and should not be construed as financial advice, but you could probably use them to convince your significant other that the car is a good buy.

[young1er]

Originally Posted by msuka

I will admit that I am a big spender but it only makes me work harder to accommodate my lifestyle and enjoy the things that I love like driving a BMW!

My thoughts exactly. This is also the reason why my employer is pushing me to get the car too. LOL

[Steelerbimmer]

Originally Posted by fan1addict

This thread is depressing . Yes if you invest all your money when you are 20 then you'll most likely end up a millionaire by the age of 65 but then what can you do with all that money at that age?

If your health is good, you can do almost everything you could at 20 and somethings even better.

[EmeraldRx]

Or you can get hit by a bus crossing the street THIS afternoon, you only live once, and you have no idea when you will see the last page "THE END" just live and enjoy what you can, as long as your family has a roof over their head and food on the table.
Shawn