do any of u guys own cars?

[Jaden Wong]

im saving up for my deposit for my first IP and im just wondering if any of u guys owned or paying off cars while u r doing this?


u know im young and i want a car and enjoy life when im young. by gettn a car as it will be more convinenent but also i have to consider the costs involved as well.....

i just want to know has anyone like saved up for a deposit while owning a car, and what kind of advice do u give a person like me if i do persue to buy a car while saving?

 

[Gordon Gekko]

Buy a Bomb!!!

GG

 

[paul_s]

Originally posted by Jaden Wong
im saving up for my deposit for my first IP and im just wondering if any of u guys owned or paying off cars while u r doing this?


u know im young and i want a car and enjoy life when im young. by gettn a car as it will be more convinenent but also i have to consider the costs involved as well.....

i just want to know has anyone like saved up for a deposit while owning a car, and what kind of advice do u give a person like me if i do persue to buy a car while saving?

I guess the decision is wheteher you want to spend money paying off a a loan over something which is only going to fall in value. From a financial point of view I can tell you a personal loan to pay off a car is a financial mistake, ok it might be fun owning a nice new car but thats going to have a big impact on your ability to save and service investment loans. Also loans for non investment purposes such as car loans are generallly not claimable tax wise, whereas a loan for an investment property would be, so I'd say its better to be paying cash for a car if your going to buy.

I would look around for something old, cheap and reliable, prefably something you can afford to pay cash for.

 

[MarkB]

Jaden

I would say that your best bet for a set of wheels, is cheap and reliable as GG and Paul suggest.

At a personal level - at age 21 my salary was about $25k and my car worth maybe $10,000 (hardly a luxury car).

At age 27 I earn close to $80 k and drive a car which is presentable enough, but worth less than $5,000.

My priorities have changed over that period.

Each to their own, but I am resolved to the fact that driving a flash car won't help me build an IP portfolio or retire earlier.

Mark

 

[Gill Bates]

cheap does not necessarily mean a bomb .
I just purchased a 1986 toyata celica for $2900.
It is in excellent condition. - 2 lady drivers since new.
( My previous car was a 1982 celica, had it for 19 years and 300,000 km - so i got my value out of it.]

 

[Ace in the Hole]

I agree with the responses.

Pay cash for a cheap reliable ordinary car.

Go to the auctions and try and get something with some rego on it. I bought my first few cars from auctions all cheap around 2k and didn't lose any money when selling them because depriciation had already been used up.

Latest vehicle is a Ute which I use all the time which I got for $5800 from Pickles auctions but market value would be at least $8000.

Regards

Adrian See

 

[see_change]

Rolf drives bombs ( but could afford better, maybe he should work harder ...)

His comment is he doubles the value of the car whenever he fills it with Petrol ...( or maybe it was when he filled the radiator..)

see change

 

[paul_s]

Originally posted by adrian_see
I agree with the responses.

Pay cash for a cheap reliable ordinary car.

Go to the auctions and try and get something with some rego on it. I bought my first few cars from auctions all cheap around 2k and didn't lose any money when selling them because depriciation had already been used up.

Latest vehicle is a Ute which I use all the time which I got for $5800 from Pickles auctions but market value would be at least $8000.

Regards

Adrian See

how do you find it with getting a roadworthy though as I think most auctioned cars don't come with one?, could be a risk in it being expensive for someone without a lot of knowledge of cars.

 

[Peter_Tersteeg]

I married a girl with a reliable, fully paid off car.

 

[hobgoblin]

Totally good advice, guys. I sold my car ($4000 Ford Laser) as soon as I got my financial head switched on. I have not really missed it as I live in Sydney with great public transport. Personally, I will never borrow for anything other than true income-producing assets EVER AGAIN! If I cannot pay cash for it, I do not need it!

Regards,
Hobbles

 

[gad]

I just upgraded from my 1973 HQ Holden to a 1981 VC Commadore
My wifes still driving her ever reliable 1983 Nissan Pulsar.

And to repair is oh so much cheaper than these modern computerised vehicles

 

[sbe]

I'm in the process of wringing every last km out of my current car.
1990 Fairlane. (380,000km)

Positives - Spacious, cheap (on LPG), comfortable etc, high range vehicle with lots of extra's (love my electrics - it's a boy thing)

Negatives - Transmission's dying, head gasket leaking (chemi-weld seems to be fixing that though!), steering rack leaks, front calipers need overhaul etc.

Basically, mechanical repairs exceed price of vehicle.

Answer - Drive it till it stops !!!

Gotta be good for another 100,000km.

Advice - get something cheap and reliable (less electoronics = cheaper repairs). Shop around, you can get decent wheels cheap. Avoid imports, you only pay more for buying and keepoing them. Be aware of whatever you buy's insurance costs. It can make a cheap car expensive!


Good luck.

Simon.

 

[Olly]

Having a car at a young age is a must on so many levels. A status symbol, a means of transport to work, social life and properties!! But here is where you have to balance your heart and your head. Do you go for the 2 door, lowered, souped up thing that others will want to pinch anyway and will cost you more to insure, or something reliable and is easy to maintain and insure. If it's your future financial security you're planning for and not the here and now - hopefully it's the latter.

As the others have already said, the older cars are easier and cheaper to fix and keep on the road.

Used car yards get their cars from auctions and then whack a margin on for profit. You can go to the auctions just as easily and buy one yourself. Ask around what people think are considered relaible brands of cars. Make a short list of say 10 types of cars you're interested in, bone up on prices by checking out the Trading Post and online car sales web sites so you know what kind of $$$ they are selling for and take someone with you to the auctions to give it a bit of a look over.

I've attached a file that someone put together for me that may help you.

Good luck
Olly

 

[MichaelM]

My story is similar to others....

Bought a 4WD for $10,000, spent another $10,000 over the next few years doing it up with all the latest off-road accessories and constant repairs while forking out the rest of my pay in fuel to run it! (V8 Chev).

Woke up one day when I discovered investing and quickly sold the 4WD. Tried riding a pushbike for 6 months but then bought a small reliable car for about $2,000 - which has been a very wise decision. I agree with what the others have said - pay cash and make sure it's a cheap and efficient car to run (not too much of a bomb though because you don't want to be stung with all the repairs).

 

[sabre]

HI All !!!!Jaden please do what I did !!!!.When I was about your age ignore all these guys HAVE FUN HEAPS of time MATE

 

[geoffw]

Here's another view.

IF:
.You drive 25,000 km per year (well, 15,000 at a pinch)
.You are in the top tax bracket
.You have a cooperative employer
.You are OK with a car with 40,000 km already on the clock

THEN
you can lease a car, and run it as a salary sacrifice through your employer.

I was about to buy another $6,000 bomb 18 months ago, but first talked to my accountant. Because all running expenses for the car come in pre tax dollars, it ended up costing me not much more to buy a 1999 Falcon worth around $20,000 than the bomb. (cost to me for all running expenses at 30,000 km pa, with lease payments petrol, expenses, rego and insurance is $230 pw. The bomb was costing me a lot in repair expenses- and I had to hire a car just to drive from Canberra to Sydney just because I could not trust the bomb to go that far, having twice broken down on the highway without mobile, many kms away from help).

 

[astroboy]

Originally posted by sabre
HI All !!!!Jaden please do what I did !!!!.When I was about your age ignore all these guys HAVE FUN HEAPS of time MATE

Yeah, what sabre said.............really.

ab

 

[Phantom]

As geoffw said try out the Salary packaging option if you want to get a new car or one that is within six years old by the time the salary package is complete, all costs are included and are at pre-tax prices (rego, fuel, insurance, servicing, tyres) saves you thousands if you want the enjoyment of a new car. It even has a good resale value after 3, 4 or 5 yrs if you pick a good car.

I had been driving bombs around for years and decided one day that I would for once get a NEW car as I had been saving and investing money for ages, you only live once and you have to enjoy the fruits of your labour at some stage.

Cheers
Phantom

 

[geoffw]

My finance company does cars only up to 3yo. Just about as good as new, and 30% cheaper.

Update on the bomb. MrsW has just come home- the second car is the bomb- it's still at her workplace- that cost a cabfare home. Plus much needed renovating time tomorrow. Not sure how much repairs will cost.

If you do big kms, and you live in a place where the transport is not terrific, you will need a reliable car.

Small kms near to a railway station in Sydney- no need. (I have a mate with a BMW in Sydney who can barely drive it, because his car spends a lot of its time parked at a railway station).

 

[paul_s]

Originally posted by geoffw
Here's another view.

IF:
.You drive 25,000 km per year (well, 15,000 at a pinch)
.You are in the top tax bracket
.You have a cooperative employer
.You are OK with a car with 40,000 km already on the clock

THEN
you can lease a car, and run it as a salary sacrifice through your employer.

interesting geoff, to be eligable though would the car have to be used for work related purposes?