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What kind of car do you own and % of salary
Old 12-15-2012, 11:33 AM   #1
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What kind of car do you own and % of salary

I been advised I spent too much on my car and curious what people on this board have spent on cars.

I spent approx 50% of my gross on a Lexus.

People here have advised me to downgrade based on my goal to retire young. After driving a Lexus I still plan on sticking with luxury cars. This will delay my goal. But it is a personal choice.
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Old 12-15-2012, 11:41 AM   #2
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I spent approx 50% of my gross on a Lexus.
Are you sure you are on the right internet board?
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Old 12-15-2012, 11:44 AM   #3
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Are you sure you are on the right internet board?
Yep, goal remains the same as everyone else on the board. Taking a different path is all.
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Old 12-15-2012, 11:48 AM   #4
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Yep, goal remains the same as everyone else on the board. Taking a different path is all.
Unless you make some serious money, the path you are taking is the long way around. A taste for expensive cars and a goal of early retirement are usually not compatible. Late early retirement maybe, but not early early retirement.
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Old 12-15-2012, 11:49 AM   #5
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Originally Posted by zxcvlkj View Post
I been advised I spent too much on my car and curious what people on this board have spent on cars.

I spent approx 50% of my gross on a Lexus.

People here have advised me to downgrade based on my goal to retire young. After driving a Lexus I still plan on sticking with luxury cars. This will delay my goal. But it is a personal choice.
That does sound like a lot. As you say, it is a personal choice. But if you want validation of that personal choice, you probably aren't going to get much from an early retirement board.

How about this? I fully and 100% support everyone being able to make their own personal choices, even when they are probably incompatible with early retirement.
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Old 12-15-2012, 11:54 AM   #6
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Spent less than 6% of gross on my Toyota in 2010.
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Old 12-15-2012, 12:02 PM   #7
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Unless you make some serious money, the path you are taking is the long way around. A taste for expensive cars and a goal of early retirement are usually not compatible. Late early retirement maybe, but not early early retirement.
I figured 40s is out of the question. push back to 50s. still saving my 10%.


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That does sound like a lot. As you say, it is a personal choice. But if you want validation of that personal choice, you probably aren't going to get much from an early retirement board.

How about this? I fully and 100% support everyone being able to make their own personal choices, even when they are probably incompatible with early retirement.
No validation required. Interested if anyone else have been able to follow a similar path and accomplished their goal.
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Old 12-15-2012, 12:06 PM   #8
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Long ago I got a car from inside a cereal box, but never one from inside a can. (Sorry.)

I spent 50% of salary once for a car, but then I generally keep 'em for decades.
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Old 12-15-2012, 12:33 PM   #9
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No validation required. Interested if anyone else have been able to follow a similar path and accomplished their goal.
Yes. Someone else was able to spend 50% of income on a car and still retire. Either their initial income was stratospheric, or else they cut back mercilessly in other areas and/or didn't get another car again for ~20+ years.

There are people here who manage to retire early and whose entire yearly salary would not cover a new Lexus. Their secret? As far as I can tell, they spend less than many others think possible and manage their money carefully.. If you are one who is prone to say, "It's impossible for me to live on $25K/year!" and "I need a new Lexus at least every four years!" then I'd sure suggest thinking twice.
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Old 12-15-2012, 12:44 PM   #10
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Got a certified pre-owned (used car) luxury model. Was about 25% of my yearly income at the time. I also keep vehicles 10+ years. That was a real stretch for my taste but I wanted to get something nice for the DW. I still drive my 13 YO pickup and plan to keep it going as long is practical as I try to do as much of my own repair and maintenance as possible.
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Old 12-15-2012, 12:54 PM   #11
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I understand!

I am retired and wanted a new BMW but bought a Ford! I could not justify spending $30k more. I just call my Ford my BMW and saved the extra cash for something more worthwhile later.
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Old 12-15-2012, 01:06 PM   #12
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I bought a new Honda this year. I traded in a 17 year old Honda. Before buying I did extensive research over the previous 2 years. I did not even bother visiting a Lexus dealer, or the Lexus website. I did consider an Infiniti, but when I realized the opportunity cost, it's value to me was significantly less than that of a Honda.

That's the way most of us think around here. Except that I'm probably considered an outlier because I bought a new vehicle. I'm paying for it over 3 years at 0.99%, which smooths the financial impact.

BTW, I'm a physician. Not all physicians are spendthrifts!
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Old 12-15-2012, 01:15 PM   #13
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I been advised I spent too much on my car and curious what people on this board have spent on cars.
Why would you care what they think, or what any of us spent? So you spent more than most of us would (you had to know that before you even posted), now what?

And we may be willing to spend 'more than others would' on something other than cars (homes, boats, vacations, collectibles, other 'toys'), so what we spend on cars misses the point WRT RE in many cases.
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Old 12-15-2012, 01:16 PM   #14
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I'm still driving my very first car (95 accord). I'm planning to use it until I pull the plug (not much longer hopefully) and then I will donate it to NPR. We also have a 2006 element . Basically our strategy is to buy an entry level honda/toyota and drive it until it dies.
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Old 12-15-2012, 01:23 PM   #15
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Last car I bought was in 2007 and it was a new Toyota which cost, after trade-in, 7% of my gross salary that year. It's 5 years old now and I expect to keep it another 3 - 5 years.

We spend a lot more on vacations than cars each year. Many people have an area they like to splurge on. The important thing imo is that you do all your saving necessary to keep on track for your own personal goals then spend the rest on whatever you like.
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Old 12-15-2012, 01:28 PM   #16
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If I were to buy a new car, I would look to get something like a CRV, or if a sedan, something like a Camry.

As I have not been in the market for a new car, I look up their prices. Much less than 1% of my net worth, as I do not have earned income anymore. Either car would be good enough for me, although a Lexus would be a far better ride, no doubt.

I was surfing the Web to look for ideas to make terrine, and just dropped in to post my 2 cents. I wonder how much of net worth 2 cents would be, heh heh heh... It's rainy outside, and I feel like having some comfort food. Darn, I would also need to get cornichon to go with the terrine.

Meanwhile, my wife is stirring a big pot of cranberry. You see, she ran across some packages of fresh cranberries on sale, and decided to get them to make home-made juice. There are other ways to enjoy life than driving a fancy car, I am telling ya....
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Old 12-15-2012, 01:36 PM   #17
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When I couldn't really afford a luxury car, I thought it would be really cool to own a Mercedes or Jaguar. Now that I can afford one, I really don't want one. Go figure!
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Old 12-15-2012, 01:51 PM   #18
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When I couldn't really afford a luxury car, I thought it would be really cool to own a Mercedes or Jaguar. Now that I can afford one, I really don't want one. Go figure!
I always thought I wanted a bonafide luxury car until I could actually afford it too, no interest any more. We all learn to master ego if we're smart...
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Old 12-15-2012, 01:57 PM   #19
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If you were retired would you go back to work to buy it? If not why buy it now?
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Old 12-15-2012, 01:58 PM   #20
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Quote:
Originally Posted by zxcvlkj View Post
I been advised I spent too much on my car and curious what people on this board have spent on cars.

I spent approx 50% of my gross on a Lexus.

People here have advised me to downgrade based on my goal to retire young. After driving a Lexus I still plan on sticking with luxury cars. This will delay my goal. But it is a personal choice.
I think you have been given good advice. I would rather invest in appreciating assets than spend money on depreciating assets.

I like nice cars but I like financial independence better. My last two cars have been higher end versions of mid-level cars (Sonata and Legacy) but they each are very comfortable and well equipped (but not in Lexus league).

It is all a matter of personal choice - but personal choices matter. One thing you could do to see the implications of your decision is to model the growth of the difference between a Lexus and something more modest assuming that you trade cars every x years and the invested funds earn y% per annum. If you're comfortable with the trade-off then by all means - enjoy!!
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