People who make under $300k hhi: do you really have over $1000+ per mo in car payments?

[Anonymous]

Anonymous wrote:Yes. My car was $65K and the bank allowed me to finance all of it at 2% interest - monthly payments of $1050ish. The $65K is sitting in a HYSA earning 4+%.

How much interest was your savings account getting when you took out a 2% loan? I think you got lucky that interest rates increased since then.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Yes. My car was $65K and the bank allowed me to finance all of it at 2% interest - monthly payments of $1050ish. The $65K is sitting in a HYSA earning 4+%.

How much interest was your savings account getting when you took out a 2% loan? I think you got lucky that interest rates increased since then.

Back then, my savings was either in ETFs or I-bonds - I forget the exact timing. I only switched to HYSAs when the interest rate went above 3%.

[Anonymous]

Anonymous wrote:Yes. My car was $65K and the bank allowed me to finance all of it at 2% interest - monthly payments of $1050ish. The $65K is sitting in a HYSA earning 4+%. [/
I took $80k and put it into two stocks that were too low about a month ago. My $80k is $100k right now. They both have yet to run, but I will look into Hysa.
If I ever wanted a new car, I'd sell my old, buy stock cheap, sell bit by bit as it goes up, and pay for the new car. Looking into EVs ofcourse.

[Anonymous]

Anonymous wrote:

Anonymous wrote:WTF, no?! What kind of cars are these people driving?

I'm poor. Not DCUM poor but actual poor. I make $35k/year.

I had to get a new car last November after an unfortunate accident with a deer. My credit at the time was 727 and I put $7k down, which is what I received from the insurance for my totaled car. My payment each month for a 2023 Kia suv is $311/mo. The lowest interest rate I could get was 7.59%. I've been paying $500/mo to pay it off faster.

When I made $35k I did not own a car, and could not fathom paying for one.

I'm another DCUM poor her who makes about $35k. I could buy such a car and I did. I also paid it off early. I am a super budgeter. You could never tell that I make so little.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I have been a trial attorney for a long time. One of the issues that I investigate during discovery relates to finances. I have met more people than I can count who have a $52k net HHI and pay more than $1k per month for their vehicle loan. First time I saw it was around 2010. I don’t get it.

So, you're assuming poor judgment. I'll counter with (especially now) that it is expensive to be poor. When I bought a car when I made 30K, and I was required to have a car for work, I didn't have $15K out of pocket for the used car I needed to buy. That meant financing.

It was Jimmy Baldwin who said you have NO IDEA how expensive it is to be poor.

When I made 30K, my boss impressed upon me that if you can't pay for a car in three years, you can't afford the car. Good advice, even now.

It is expensive to be poor, but even more expensive be uninformed. I've been poor and I have been uniformed (also know stupid, ignorant). Things happen to you when you are poor, and you make thing happen for you when you have the knowledge. I got out of poverty, but I know how hard it is and how people start thinking all this extra they have to pay is unavoidable.
It is crazy what banks do to you when you are poor versus rich, and this is just banks.

[Anonymous]

Yep. We make 300k+ and have 2 car payments totaling close to 1k. These are on nice used cars, nothing luxurious. This is the first time we've had car payments in 5 years. We'll pay at least one of them off early.

[Anonymous]

No. Got lucky and paid cash for a new Subaru in late 2019 right before the COVID crush.

We paid $30.5K for an Outback with the Limited trimline. It was the 2019 model year and they already had the new 2020's on the lot. I think we paid $7K below MSRP.

Never will get a deal like that again in my lifetime, unfortunately. And we will probably never finance a future car purchase, given the rates.

[Anonymous]

Anonymous wrote:No. Got lucky and paid cash for a new Subaru in late 2019 right before the COVID crush.

We paid $30.5K for an Outback with the Limited trimline. It was the 2019 model year and they already had the new 2020's on the lot. I think we paid $7K below MSRP.

Never will get a deal like that again in my lifetime, unfortunately. And we will probably never finance a future car purchase, given the rates.

At the time of purchase, our HHI was probably around $315K. We are now at $530K. Would still buy the same Subaru.

[Anonymous]

A good rule of thumb is to pay no more than 20% of your gross HHI on a vehicle purchase. That's assuming you keep a car for seven years.

[Anonymous]

Anonymous wrote:A good rule of thumb is to pay no more than 20% of your gross HHI on a vehicle purchase. That's assuming you keep a car for seven years.

Wow, no way. We pay cash and no more than about 7% of gross income. Keep cars at least 10 years.

[Anonymous]

Anonymous wrote:

Anonymous wrote:A good rule of thumb is to pay no more than 20% of your gross HHI on a vehicle purchase. That's assuming you keep a car for seven years.

Wow, no way. We pay cash and no more than about 7% of gross income. Keep cars at least 10 years.

That's good! so, <$21k for the car. Do you typically buy used?

What is your gross income?

[Anonymous]

Anonymous wrote:

Anonymous wrote:A good rule of thumb is to pay no more than 20% of your gross HHI on a vehicle purchase. That's assuming you keep a car for seven years.

Wow, no way. We pay cash and no more than about 7% of gross income. Keep cars at least 10 years.

20% of gross means if you make $100K/year you keep your car purchase budget to $20K. I think that’s reasonable.

[Anonymous]

1k on a car payment? No, never. Our family of four has one used Toyota, which we bought used. It's 8 years old and has just over 100k miles on it. It should last another 10-12 years, at least. We will be done paying college tuition in three years, and at that time will put money away to buy that next car cash. We make about 200k.

[Anonymous]

Personally, I drive a Lexis and have a 6000k s ft wife.

[Anonymous]

Anonymous wrote:

Anonymous wrote:A good rule of thumb is to pay no more than 20% of your gross HHI on a vehicle purchase. That's assuming you keep a car for seven years.

Wow, no way. We pay cash and no more than about 7% of gross income. Keep cars at least 10 years.

Can I comfortably do 8%? Really want that 911 turbo but don't want to settle for the coupe.