Bad idea to buy a new car?

[ldiot]

Would it be stupid or just less than ideal to buy a 40k car within a year of graduation?

I'm thinking black charger scat pack, putting on 275s with black rims, the window tint, & SLP loudmouth. None of this prius/civic/BMW bullsht

OR I could just be "smart" and buy a Cruze/Fusion/Mazda6 and wait another 10 years... but then I'll be middle aged which is lame.

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[tartesos]

Stupid?
Depends.
If this is not going to get in the way of your financial goals( I assume you have some ) then go for it.
If you won't stop paying your debt or saving for retirement by getting this car then go ahead and enjoy it.

It's not like your getting a Maserati or Porsche.





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[ldiot]

Stupid?
Depends.
If this is not going to get in the way of your financial goals( I assume you have some ) then go for it.
If you won't stop paying your debt or saving for retirement by getting this car then go ahead and enjoy it.

It's not like your getting a Maserati or Porsche.





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Yeah my goal is simply to pay off my student loan aggressively. I won't be buying a house and will be living as cheap as possible. I would be buying a car anyways so the way I am looking at it I'd probably be spending at least 15-20k... so buying this specific car is only 20k extra (in other words even though the car is 40k I'm only "blowing" 20k if that makes sense, since I'd be buying a car anyways)

Hell I might even live with my parents for a year or two

 

[tartesos]

Dooo eeettttt!!!
I'm a bad example, I just got my 'stang


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[PistolPete]

Why not look for a 1 year old car that was leased and has low miles and buy it for around 30-40% less?

 

[thesauce]

It really depends. We don't have your full financial picture. $200k salary and $500k debt is different than $500k salary and $200k debt.

Even then, people should be able to enjoy some of their hard-earned money, so if you are still meeting your financial goals and this is extra money, go for it. I will probably buy something nice around 5 years out from training. For now, I'm just socking away.

 

[Redtwogreen]

Stupid seems like a harsh term, but without knowing what your exact financial situation is it is hard to say. Do you have 6 figures of debt? Do you have 6 figures of income? That would definitely weigh into the analysis. If your goal is to pay off debt, then pay off debt and then buy your fancy car later. Or at least wait a couple of years to know what your financial situation will be like. Maybe your job doesn't pan out, maybe you get a better job, etc. Overall, I'd say its a good idea to wait. I can definitely appreciate that it sucks to wait when you have been working hard for so long all through school. But, I'm guessing that at least part of the reason you went became a health care professional was so that you could make money, so I'd recommend making some money before spending a bunch. I am a lawyer, and hubby is a dentist. Despite those facts, we recently bought a 2006 Toyota Matrix for $5000. Is it sexy? Definitely not. And definitely doesn't compare to a charger. But it is in great condition, looks nice, and gets us where we need to go. Our goal right now is to knock out our 6 figures of debt-- we didn't want anything, including a sexy car, getting in our weigh. Good luck!

 

[Entadus]

Stupid seems like a harsh term, but without knowing what your exact financial situation is it is hard to say. Do you have 6 figures of debt? Do you have 6 figures of income? That would definitely weigh into the analysis. If your goal is to pay off debt, then pay off debt and then buy your fancy car later. Or at least wait a couple of years to know what your financial situation will be like. Maybe your job doesn't pan out, maybe you get a better job, etc. Overall, I'd say its a good idea to wait. I can definitely appreciate that it sucks to wait when you have been working hard for so long all through school. But, I'm guessing that at least part of the reason you went became a health care professional was so that you could make money, so I'd recommend making some money before spending a bunch. I am a lawyer, and hubby is a dentist. Despite those facts, we recently bought a 2006 Toyota Matrix for $5000. Is it sexy? Definitely not. And definitely doesn't compare to a charger. But it is in great condition, looks nice, and gets us where we need to go. Our goal right now is to knock out our 6 figures of debt-- we didn't want anything, including a sexy car, getting in our weigh. Good luck!

Agreed, but you're being too nice about it.

I better go Dave Ramsey on you, OP

40grand on a car while you live with your parents? DUMB DUMB DUMB.
40grand on a car while your primary financial goal is to pay off your loans as quickly as possible? Yeah that is stupid

Were you going to take out a loan on the car, too? Just bloat the debt a little more?

The debtor is slave to the lender. Gain your peace. Seek financial independence (Prepare to get rich)

Or as WCI puts it, live like a resident for a few years

 

[QofQuimica]

I'm going, dude(tte). Seriously? You're a grown up who's about to earn a six figure income; you're contemplating sponging off your parents just so you can drive a $40,000 car; but having to wait a few years until you can afford to buy the car is what seems "lame" to you?

 

[keifernny2]

Look at the doctors parking lot and count how many dodge chargers are in there. Then if you still want it, lease a model with no aftermarket add ons (add ons have like no residual value when you go to sell). It's ok to fritter money away , as long as you are doing it consciously and know how much you're frittering. A 40k car on a 200k salary is not a big deal.


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[jacksparrow82]

Now is the time to be frugal as possible. Remember doctors are way behind on savings compared to people who started saving after college. You've already lost out on years of taking advantage of the beauty of compounding interest. Your first goal after graduation should be to save up about 6 months worth of living expenses as an emergency fund. That way you don't have to rely on credit for any unexpected expenses. Second, you need to start saving for retirement and the things that you want. Set up a monthly budget that automatically puts money into retirement accounts and into general savings accounts for things like new cars or vacations, etc. Then, once you're doing this, starting paying off your debt as aggressively as possible and resist the urge to upgrade anything in your life for at least a couple of years. You'll be SO glad you did when you're 3-4 years out of residency, debt free and making over 200k/yr. Then, you can buy whatever crazy car you want. Live frugally until you have a healthy savings and you're virtually debt free (or at least have nothing but ultra low interest rate loans left).

Buy a cheap used car for now. You'll be able to pay cash for a 40k+ car in 3-4 years if you play your cards right.

This is what I wish I could have convinced myself to do 6 years ago when I graduated residency! If only someone would invent a time machine already!

 

[EllieHan]

Always go second hand, the moment it goes on the road you will have lost 25% of the value of the car.