The Maximum You should spend on your car(s)

virgo said:
Hiya

I came across a very interesting post by Mr Financial Samurai recently. (i love his blog) . While it may be US-centric, i thought it was very thought provoking...

It says the max amt one should spend on one's car(s) is 5% of your net worth.
Eg if your net worth is 1 million, you should spend max 50,000 on your car(s).

Based on this, i find i should give myself (or rather my hubby )a big boost :D

What is your situation? Care to share?
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The maximum you should spend on your car, is what it takes to save you.

In 2012, I had a major car accident. Collision with one car at speeds of 100km/hr who ran a red(drunk, drugged guy) vs 60km/hr (me).

3 police cars, 3 ambulances, 2 fire brigades.

Every paramedic, police, fireman told me, if I had not been in a $75k 2010 German car, the outcome would be very different. The best case would be, I'd be a paraplegic for life, but I'd most likely be dead.

I walked way from his accident with a broken wrist only. I didn't even stay the night in the hospital.

Things like this don't happen to most people, and you're probably thinking it'll never happen to you. All I can say is, when it happens, it only takes 2 seconds to potentially change your life forever.
 
Deltaberry said:
Things like this don't happen to most people, and you're probably thinking it'll never happen to you. All I can say is, when it happens, it only takes 2 seconds to potentially change your life forever.
Click to expand...

Money well spent. I wonder if that idiot did any jail time?
 
virgo said:
.......

It says the max amt one should spend on one's car(s) is 5% of your net worth.
Eg if your net worth is 1 million, you should spend max 50,000 on your car(s).

.........

What is your situation? Care to share?
Click to expand...


Sounds like a reasonable generalization and I think it is reasonable advice for younger or less financially "fit" individuals.

I agree with most of the other comments, however at the end of the day, one size does not fit all. Consciously spending more may be appropriate due to deliberate sacrifices elsewhere..... yes, it may be hard for some to fathom, but some people really do enjoy cars/bikes/trucks for more than just "transport"... crazy huh? ...no, not really. We all have our vices.

Heck, some of us have more than one personal mode of transport. Isn't that just absurd? Well, everything is relative...... just like some people think that owning a $70k boat that is used 3-4 times a year is a ridiculous indulgence. Each to their own.

If you can afford it (truly afford it without the aid of a loan shark) then it all comes down to how you want to spend your blood, sweat & tears.....
 
We bought a new car 12 years ago. Still have it, time to replace soon but it will be second hand this time, I just don't see new cars as being worth it.

Although if we're using the % of net worth as a benchmark, perhaps it's time to dust off the pushbike :D
 
Of The Vultures said:
We bought a new car 12 years ago. Still have it, time to replace soon but it will be second hand this time, I just don't see new cars as being worth it.

Although if we're using the % of net worth as a benchmark, perhaps it's time to dust off the pushbike :D
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a bit gross tho - yuck. a bit like wearing someone elses undies
 
Ausprop said:
Tho mass is always your biggest safety feature
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Yes, I'd say that plays a big role as well. My younger cousin got into a similar accident as Deltaberry. His car was virtually unrecogniseable and emergency services thought he was dead when they arrived. They had to cut open the roof to get him out. He was largely fine but had a break in his leg which needed a metal rod put in. He was in an oldish Skyline that was probably a fifth of the cost of Deltaberry's BMW. I think there are a lot of factors that contribute to safety outside of price/newness.
 
Ausprop said:
glancing thru the car section today I see the latest mazda3 ranked higher safety than the bmw 3. Tho mass is always your biggest safety feature
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Yes I have always wondered whether the more expensive german /euro marques are definitely safer than the usual japanese cars.They seem to have the same ANCAP ratings and kerb side mass. Are we paying for extra safety or just the branding?
 
Aaron_C said:
I don't think anyone expects to win (financially) with a car. Buying a nice car is like buying a nice jacket, nice food or a nice handbag - for enjoyment. You know it will devalue as soon as you drive it off the floor but that's what money is for isn't it?

The other thing I'd add is buying a car as a business is less expensive than buying one as a PAYG which is why many people have nicer cars than they otherwise would have.
Click to expand...

I read somewhere that you should "buy the cheapest car your ego can afford". Unless it is an income producing vehicle that is used to conduct some sort of business then taking out a loan to purchase it isn't the best thing to be doing with your money. When you hear people talking about bad debt, this is it IMO
 
My $1000 prado, Below market value;)


only needed a light vacuum..




3mins later after I threw a bucket of water over it.. (really a week of cleaning)
 
Of The Vultures said:
SlumpMunkey, that's a great reno ;)
Seriously though, you bought this for $1000? Where??
Click to expand...
''Tradin Post'' I thought I was ''Dreamin''
The ad appeared as I was already on the site so I went straight there on my motorcycle and handed the cash over without even starting it. Worst that was going to happen id just use it for the farm.


The Y-man said:
Nice work slumpmonkey. Pity you couldn't save the driver's seat from fluffy mould :D

The Y-man
Click to expand...
The seat was a write-off so $40 on seat cover;)

DaveM said:
Nice reno. How much equity did you get on reval?
Click to expand...
It owes me $1800 by the time I put rego on it. I could sell it today for $5000 quick sale. I actually set it up for mobile detailing, I have mounted pressure washer and hose reel etc in the back..

I completely removed the interior and cleaned every bit section by section. I the put it up on my car hoist and clean all underneath but i have been 4wding and gone in ''a few puddles'' since:eek:
 
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