At what salary point would you replace your car

[PPLdude]

I'm still young (20) and really want to get a new car.

However I'm not sure if it will be in my best interest financially...

My Ford Fiesta 2006 just isn't doing it anymore :erm:

Do I really need to be saving all that I can now? Even though i'm certain ill be getting paid a lot more in about 5-6 years

How much should you be earning for it to be financial feasible?

 

[Gtx Gaming]

When you are saving 20% a month to RA and 10% to a rainy day fund, then only I would consider financing a car.

 

[Kosmik]

Buy a car when you need it or it is not financially viable to keep your current one going ie: monthly maintenance more than a decent installment ( this can include reliability ).

Don't chase salary and car improvements, rather save the additional money into a nest egg for a home.

2c.

Whats wrong with a nippy fiesta? Sounds like the perfect car for a young, no family person. And at 20, your chance of a collision/accident is still very high.

 

[Messugga]

I'm still young (20) and really want to get a new car.

However I'm not sure if it will be in my best interest financially...

My Ford Fiesta 2006 just isn't doing it anymore :erm:

Do I really need to be saving all that I can now? Even though i'm certain ill be getting paid a lot more in about 5-6 years

How much should you be earning for it to be financial feasible?

Buying a new (to you) car is almost never in your best interest financially.

Yes, you should be saving. You're making assumptions regarding your future earning potential - things change very, very quickly. First build up a financial buffer with which to cover all expenses for a few months. I like 6 months. Some people prefer 12 months.

As for feasibility - I've always gone for annual salary/2 = maximum purchase price on the car. So if you want a R500k car, you need to be earning R1m gross. It works out pretty well in terms of disposable income, taxes, etc.

 

[Mike Hoxbig]

Salary has no role in me replacing a car. It's replaced when it needs to be...

 

[NarrowBandFtw]

Salary has no role in me replacing a car. It's replaced when it needs to be...

^ this, but it takes some years of yearning for new cars before that epiphany strikes

@OP: the most sensible answer: when you can buy it cash

 

[PPLdude]

When you are saving 20% a month to RA and 10% to a rainy day fund, then only I would consider financing a car.

I'm saving 50% of my salary after RA etc

Buy a car when you need it or it is not financially viable to keep your current one going ie: monthly maintenance more than a decent installment ( this can include reliability ).

Don't chase salary and car improvements, rather save the additional money into a nest egg for a home.

2c.

Whats wrong with a nippy fiesta? Sounds like the perfect car for a young, no family person. And at 20, your chance of a collision/accident is still very high.

Spent just over 5k this month on my car. Around 15k within 6 months

Buying a new (to you) car is almost never in your best interest financially.

Yes, you should be saving. You're making assumptions regarding your future earning potential - things change very, very quickly. First build up a financial buffer with which to cover all expenses for a few months. I like 6 months. Some people prefer 12 months.

As for feasibility - I've always gone for annual salary/2 = maximum purchase price on the car. So if you want a R500k car, you need to be earning R1m gross. It works out pretty well in terms of disposable income, taxes, etc.

I know it's very volatile, but if need be I've made around 12 months worth expenses in crypto (Which it still is in)

Salary has no role in me replacing a car. It's replaced when it needs to be...

It needs to be faster and RWD

 

[Polymathic]

At your age I'd also get insurance quotes before purchasing, you could end up with insurance that is double your premiums

 

[Gtx Gaming]

I'm saving 50% of my salary after RA etc



Spent just over 5k this month on my car. Around 15k within 6 months




I know it's very volatile, but if need be I've made around 12 months worth expenses in crypto (Which it still is in)



It needs to be faster and RWD

Get it, your saving enough enjoy life also!

Get insurance quotes first, at your age they will nail your for newer/faster cars!

 

[Jehosefat]

I got a Toyota Corolla at the beginning of 2007 from my folks while I was at varsity. Only replaced it at the end of 2016 (because it was stolen, otherwise I would still be driving it). Paid off my new car by June 2017 (Audi A3 Sedan). No need to have a ridiculously expensive car relative to what you earn imo.

 

[Barbarian Conan]

My checklist:

After buying a house (optional)
Have 3 x net salary in a rainy day fund. Not crypto, something more stable.
Saved double the expected repayments a month for 3 consecutive months as proof of real affordability.

And even after that I saved very little after buying a new car. Especially since you want something fast and RWD, you can expect that other costs like tyres will ruin your month.

edit:
Also anticipate changes. The first time I budgeted for a new car, I was sharing a house with friends. I thought I could afford a car but just not by a large enough margin to make me feel comfortable. Fast forward 6 months, and his gf wants to move in and I have to find a new place. That right there would have completely ****ed me, unless I wanted to move into a house with a bunch of strangers.

 

[Messugga]

Get it, your saving enough enjoy life also!

Get insurance quotes first, at your age they will nail your for newer/faster cars!

If he can even get the damn thing insured. It's tough getting a performance car insured when you're under 23 years old. The premium is also going to be quite rough.

With that being said, if you can really afford it, go for it. Life is short - enjoy it. Just realize that most cars lose their luster very quickly. You don't want something that puts you into debt for five years, that doesn't do anything for you. That's why I loved my 86. Fun car to drive, looked good, and I got it for a good price. These days they're incredibly overpriced, mind you.

 

[Napalm2880]

I got a Toyota Corolla at the beginning of 2007 from my folks while I was at varsity. Only replaced it at the end of 2016 (because it was stolen, otherwise I would still be driving it). Paid off my new car by June 2017 (Audi A3 Sedan). No need to have a ridiculously expensive car relative to what you earn imo.

Been working for 8.5 years and up until 2 yrs ago I was driving a 1996 Toyota Corolla.

 

[supersunbird]

I'm still young (20) and really want to get a new car.

However I'm not sure if it will be in my best interest financially...

My Ford Fiesta 2006 just isn't doing it anymore :erm:

Do I really need to be saving all that I can now? Even though i'm certain ill be getting paid a lot more in about 5-6 years

How much should you be earning for it to be financial feasible?

I only started gainful employment at age 29. I am 39 now and so wish I could have started working earlier and this saving earlier.

Anyway, onto the topic. Get yourself a 2 year old under 50 000km car if you can afford. Get your lovely car in 6 years when earning so much more and only if saving at least 20%pm for retirement

 

[PPLdude]

^ this, but it takes some years of yearning for new cars before that epiphany strikes

@OP: the most sensible answer: when you can buy it cash

I think this is the safest option.


Ill stick to ruining my mom's tires for now :crylaugh:

Seeing as i'm saving 50% of my salary, does putting away 30% of that for a car sound reasonable? (After I have 6 month living expenses in the bank)

 

[xrapidx]

I replace my vehicles when I have a need for another one, and the current one can't meet that need. Also, if a car starts showing signs of unreliability - its gone.

 

[Kosmik]

Spent just over 5k this month on my car. Around 15k within 6 months

Thats a good chunk of change, then rather get a decent car with service and maintenance for around R4k pm , allow yourself the extra R1k fat for insurance.

But, be smart, don't chase the car, save the cash. If you can get a nice lower car, do so.

 

[Mike Hoxbig]

I think this is the safest option.


Ill stick to ruining my mom's tires for now :crylaugh:

Seeing as i'm saving 50% of my salary, does putting away 30% of that for a car sound reasonable? (After I have 6 month living expenses in the bank)

It's your money dude so you can do whatever you want with it.

Personally I wouldn't spend 30% of my salary on a car, irrespective of whether I'm saving 20% for retirement. I'd look at the bigger picture and consider all factors.

If I were your age, I'd be thinking that at some point I'd like to buy my own place - I mean it's difficult to fsck a chic if you're still staying with your mom, and having your own place is probably more of a turn-on than having a flashy car. And having your own place comes with it's own set of expenses apart from the bond - levies, rates, elec etc.

So if you do have money to spare after saving 20% for retirement, save the rest for a property deposit. And when you decide to buy, factor in the living expenses that go with it incl your bond repayments. Whatever is left of that can go towards a car...

 

[saturnz]

lets put it this way, even if I was earning R1m a month I would still be driving my 30 year old second hand cars which I paid cash for.

 

[Kosmik]

lets put it this way, even if I was earning R1m a month I would still be driving my 30 year old second hand cars which I paid cash for.

That. I drive a 10 year old car ( 105k on the clock ) , wife drives a 8 year old car ( 101k on the clock ), both are fine, well maintained , PAID OFF, and our real money goes towards our home and children.

Which would you rather have: s****y car or own home (bonded) ?

*edit* lol at filter , s-w-a-n-k-y