What % of NET monthly salary do you spend on your car
Discussion
gizlaroc said:
£60k is around £3500 a month.
Not thought about a pension?
Say you are happy for a more moderate lifestyle when you retire, if you start paying in at 25 with a view to retire at 65, you will need to pay a fair bit more than you think in.
Have a go with this, it may just shock you....
https://www.standardlife.co.uk/c1/guides-and-calcu...
I think this is what some are saying about people living beyond their means, they simply aren't considering their retirement.
That calculator is hardcore stupid. It assumes you want almost your whole salary as a pension. That is completely bonkers.Not thought about a pension?
Say you are happy for a more moderate lifestyle when you retire, if you start paying in at 25 with a view to retire at 65, you will need to pay a fair bit more than you think in.
Have a go with this, it may just shock you....
https://www.standardlife.co.uk/c1/guides-and-calcu...
I think this is what some are saying about people living beyond their means, they simply aren't considering their retirement.
I would be content with 1/4 of what I earn as a pension.
walm said:
You have done the opposite of ignore the depreciation.
You have assumed 33% a year, which is nuts.
You need to work out what the 911 is worth in three years once you have paid off the interest free loan.
Say what, £15k worst case (depending on mileage).
So you will likely see annual depreciation of £2,500-3,500.
That's what it costs you. ~7% of net income on depreciation.
To run it, maybe £3-4K with bork potential NOT included (just google bore scoring, or rather don't!).
Don't you have any expenses as an optometrist?
We could argue about the semantics of an exact calculation to include depreciation here, however the reality is that most people on here seem to spend a very low amount relative to their net salary on their car. Even if you did calculate it precisely, it might only amount to another percent or two.You have assumed 33% a year, which is nuts.
You need to work out what the 911 is worth in three years once you have paid off the interest free loan.
Say what, £15k worst case (depending on mileage).
So you will likely see annual depreciation of £2,500-3,500.
That's what it costs you. ~7% of net income on depreciation.
To run it, maybe £3-4K with bork potential NOT included (just google bore scoring, or rather don't!).
Don't you have any expenses as an optometrist?
I think that in itself is interesting for two main reasons -
(a) this is a motoring forum, so you'd expect that figure to be higher than "average"
(b) the O/P was really trying to prove that many people spend a disproportionate amount of their monthly income on a car - this hasnt been bourne out with figures here.
daemon said:
We could argue about the semantics of an exact calculation to include depreciation here, however the reality is that most people on here seem to spend a very low amount relative to their net salary on their car. Even if you did calculate it precisely, it might only amount to another percent or two.
I think that in itself is interesting for two main reasons -
(a) this is a motoring forum, so you'd expect that figure to be higher than "average"
(b) the O/P was really trying to prove that many people spend a disproportionate amount of their monthly income on a car - this hasnt been bourne out with figures here.
Do we know what "average" is though?I think that in itself is interesting for two main reasons -
(a) this is a motoring forum, so you'd expect that figure to be higher than "average"
(b) the O/P was really trying to prove that many people spend a disproportionate amount of their monthly income on a car - this hasnt been bourne out with figures here.
I agree PH should be higher!
Although, perhaps your average PHer is slightly more informed than the average "buy a new car every 3 years on the never-never" and is more savvy about lowering their depreciation cost.
ORD said:
That calculator is hardcore stupid. It assumes you want almost your whole salary as a pension. That is completely bonkers.
I would be content with 1/4 of what I earn as a pension.
I just did that too, and thought it was completely unrealistic.I would be content with 1/4 of what I earn as a pension.
By the time I retire I'll have a house paid so won't need the income level I do now to service that loan, and imagine my lifestyle will change so I'll need less income generally. I reckon a quarter of what I'm on now would suffice too.
daemon said:
We could argue about the semantics of an exact calculation to include depreciation here, however the reality is that most people on here seem to spend a very low amount relative to their net salary on their car. Even if you did calculate it precisely, it might only amount to another percent or two.
I think that in itself is interesting for two main reasons -
(a) this is a motoring forum, so you'd expect that figure to be higher than "average"
(b) the O/P was really trying to prove that many people spend a disproportionate amount of their monthly income on a car - this hasnt been bourne out with figures here.
Or those who do finance or lease monthly haven't contributed the percentage their net monthly spend to the thread as much as those who pay cash upfront for whatever reason.I think that in itself is interesting for two main reasons -
(a) this is a motoring forum, so you'd expect that figure to be higher than "average"
(b) the O/P was really trying to prove that many people spend a disproportionate amount of their monthly income on a car - this hasnt been bourne out with figures here.
Those who run round in a snotter are like vegans: How do you know if somebody is a vegan? Don't worry they'll soon tell you. And I say that as somebody who has had plenty of snotters and plenty of cars on finance over the years.
ORD said:
That calculator is hardcore stupid. It assumes you want almost your whole salary as a pension. That is completely bonkers.
I would be content with 1/4 of what I earn as a pension.
You can put in what you want. I would be content with 1/4 of what I earn as a pension.
It is a great tool to show people how much they need to be considering to put away each month to earn what they think they will need to earn.
Someone on £60k who is happy with £2500 a month pension (including state contribution) would need to put away £1300 a month if they start when they are 25. However, start when you are 40 and you need to pout in £1750 a month.
I know for a fact that many of my mates, a lot of whom are on good salaries, and are in their 40s, are paying like £500 in. When you say that is only going to give them £300 a week to live on including the state pension they look genuinely shocked.
I also think this work pension scheme is going to be a real problem going forward, many think because they are now paying £20 a week in a work they don't need a proper pension as well, they think they are covered. It will backfire big time imho.
uuf361 said:
I just did that too, and thought it was completely unrealistic.
By the time I retire I'll have a house paid so won't need the income level I do now to service that loan, and imagine my lifestyle will change so I'll need less income generally. I reckon a quarter of what I'm on now would suffice too.
I guess that depends what chunk of your wage is going on mortgage and pension? By the time I retire I'll have a house paid so won't need the income level I do now to service that loan, and imagine my lifestyle will change so I'll need less income generally. I reckon a quarter of what I'm on now would suffice too.
They are the only two real savings you will make if you want to still have a life.
gizlaroc said:
You can put in what you want.
It is a great tool to show people how much they need to be considering to put away each month to earn what they think they will need to earn.
Someone on £60k who is happy with £2500 a month pension (including state contribution) would need to put away £1300 a month if they start when they are 25. However, start when you are 40 and you need to pout in £1750 a month.
I know for a fact that many of my mates, a lot of whom are on good salaries, and are in their 40s, are paying like £500 in. When you say that is only going to give them £300 a week to live on including the state pension they look genuinely shocked.
I also think this work pension scheme is going to be a real problem going forward, many think because they are now paying £20 a week in a work they don't need a proper pension as well, they think they are covered. It will backfire big time imho.
I'd be surprised if the state pension isn't means tested for new pensioners at some point in the next twenty years. Relying on the state pension to top up a private pension forty or even twenty years out is risky.It is a great tool to show people how much they need to be considering to put away each month to earn what they think they will need to earn.
Someone on £60k who is happy with £2500 a month pension (including state contribution) would need to put away £1300 a month if they start when they are 25. However, start when you are 40 and you need to pout in £1750 a month.
I know for a fact that many of my mates, a lot of whom are on good salaries, and are in their 40s, are paying like £500 in. When you say that is only going to give them £300 a week to live on including the state pension they look genuinely shocked.
I also think this work pension scheme is going to be a real problem going forward, many think because they are now paying £20 a week in a work they don't need a proper pension as well, they think they are covered. It will backfire big time imho.
tankplanker said:
daemon said:
We could argue about the semantics of an exact calculation to include depreciation here, however the reality is that most people on here seem to spend a very low amount relative to their net salary on their car. Even if you did calculate it precisely, it might only amount to another percent or two.
I think that in itself is interesting for two main reasons -
(a) this is a motoring forum, so you'd expect that figure to be higher than "average"
(b) the O/P was really trying to prove that many people spend a disproportionate amount of their monthly income on a car - this hasnt been bourne out with figures here.
Or those who do finance or lease monthly haven't contributed the percentage their net monthly spend to the thread as much as those who pay cash upfront for whatever reason.I think that in itself is interesting for two main reasons -
(a) this is a motoring forum, so you'd expect that figure to be higher than "average"
(b) the O/P was really trying to prove that many people spend a disproportionate amount of their monthly income on a car - this hasnt been bourne out with figures here.
Either way, we're certainly not seeing the prevalence of say, 50%+ that the O/P seemed to be expecting.
walm said:
Do we know what "average" is though?
I agree PH should be higher!
Although, perhaps your average PHer is slightly more informed than the average "buy a new car every 3 years on the never-never" and is more savvy about lowering their depreciation cost.
Well there is that too. Who knows.I agree PH should be higher!
Although, perhaps your average PHer is slightly more informed than the average "buy a new car every 3 years on the never-never" and is more savvy about lowering their depreciation cost.
My point was, when people talk about a percentage of their take home are they actually planning for the future or have they completely ignored it and are talking about a percentage of a wage they shouldn't really have?
£60,000 a year paying £1000 a month into a pension starting when they are 40 will give you £2900 a month take home.
This will give you £12500 a month as a pension and could be topped up to £20500 if you still get a state pension in 27 years time.
I think that is the sort of balance most people would consider reasonable.
Trying to live on between £240-390 a week is not being greedy imho.
The guy who is not paying into a pension is getting £3500 a month now, he may think that spending three or four hundred a month on a car is not a problem, but will he look back on his 320d when he is 67 and collecting his £153 a week pension and think "Cor that was money well spent?"
£60,000 a year paying £1000 a month into a pension starting when they are 40 will give you £2900 a month take home.
This will give you £12500 a month as a pension and could be topped up to £20500 if you still get a state pension in 27 years time.
I think that is the sort of balance most people would consider reasonable.
Trying to live on between £240-390 a week is not being greedy imho.
The guy who is not paying into a pension is getting £3500 a month now, he may think that spending three or four hundred a month on a car is not a problem, but will he look back on his 320d when he is 67 and collecting his £153 a week pension and think "Cor that was money well spent?"
daemon said:
I think quite a few of the responses have been from PCP / leasers / financers.
Either way, we're certainly not seeing the prevalence of say, 50%+ that the O/P seemed to be expecting.
I'm not sure you'll see many admitting to spending that much of their net monthly wage on a car for a number of reasons, not least because they'd get the p**s taken out of them. Either way, we're certainly not seeing the prevalence of say, 50%+ that the O/P seemed to be expecting.
gizlaroc said:
uuf361 said:
I just did that too, and thought it was completely unrealistic.
By the time I retire I'll have a house paid so won't need the income level I do now to service that loan, and imagine my lifestyle will change so I'll need less income generally. I reckon a quarter of what I'm on now would suffice too.
I guess that depends what chunk of your wage is going on mortgage and pension? By the time I retire I'll have a house paid so won't need the income level I do now to service that loan, and imagine my lifestyle will change so I'll need less income generally. I reckon a quarter of what I'm on now would suffice too.
They are the only two real savings you will make if you want to still have a life.
In my case, though, I plan to downsize and release a sizeable chunk of equity on retirement and live off the income as my house is way too big for my needs now, let alone in retirement.
gizlaroc said:
My point was, when people talk about a percentage of their take home are they actually planning for the future or have they completely ignored it and are talking about a percentage of a wage they shouldn't really have?
The guy who is not paying into a pension is getting £3500 a month now, he may think that spending three or four hundred a month on a car is not a problem, but will he look back on his 320d when he is 67 and collecting his £153 a week pension and think "Cor that was money well spent?"
True - and a fair point.The guy who is not paying into a pension is getting £3500 a month now, he may think that spending three or four hundred a month on a car is not a problem, but will he look back on his 320d when he is 67 and collecting his £153 a week pension and think "Cor that was money well spent?"
I guess its whether people contribute to a pension at source through their employer, and thus their "take home pay" is less, or whether they contribute to a private pension out of their take home pay.
gizlaroc said:
£60,000 a year paying £1000 a month into a pension starting when they are 40 will give you £2900 a month take home.
This will give you £12500 a month as a pension and could be topped up to £20500 if you still get a state pension in 27 years time.
£20,500 a year. Not a month!This will give you £12500 a month as a pension and could be topped up to £20500 if you still get a state pension in 27 years time.
You should also be saving on your commuting/work costs as these should drop to zero, and should reduce your overall mileage as well so less expense running a car? For me its the other way around as all my (and the wife's) work mileage is at 45p as I'm classed as a home worker.
Don't pensioners pay less tax £ for £ than a PAYE as they don't pay national insurance or do I have that wrong? Meaning your net will be higher, about £125 on £20.5k a month?
Small amounts but probably works out for most that £20.5k of pension is worth closer to £45k of pre retirement income allowing for national insurance, mortgage, car, commuting/work costs?
Its surprising how much money people do waste on over paying for utilities, mobile phones, Sky, beer, going out, eating out particularly eating at work, etc. not just cars.
Don't pensioners pay less tax £ for £ than a PAYE as they don't pay national insurance or do I have that wrong? Meaning your net will be higher, about £125 on £20.5k a month?
Small amounts but probably works out for most that £20.5k of pension is worth closer to £45k of pre retirement income allowing for national insurance, mortgage, car, commuting/work costs?
Its surprising how much money people do waste on over paying for utilities, mobile phones, Sky, beer, going out, eating out particularly eating at work, etc. not just cars.
tankplanker said:
daemon said:
I think quite a few of the responses have been from PCP / leasers / financers.
Either way, we're certainly not seeing the prevalence of say, 50%+ that the O/P seemed to be expecting.
I'm not sure you'll see many admitting to spending that much of their net monthly wage on a car for a number of reasons, not least because they'd get the p**s taken out of them. Either way, we're certainly not seeing the prevalence of say, 50%+ that the O/P seemed to be expecting.
tankplanker said:
You should also be saving on your commuting/work costs as these should drop to zero, and should reduce your overall mileage as well so less expense running a car? For me its the other way around as all my (and the wife's) work mileage is at 45p as I'm classed as a home worker.
Don't pensioners pay less tax £ for £ than a PAYE as they don't pay national insurance or do I have that wrong? Meaning your net will be higher, about £125 on £20.5k a month?
Small amounts but probably works out for most that £20.5k of pension is worth closer to £45k of pre retirement income allowing for national insurance, mortgage, car, commuting/work costs?
Its surprising how much money people do waste on over paying for utilities, mobile phones, Sky, beer, going out, eating out particularly eating at work, etc. not just cars.
£1000 a month int a pension for someone on £60k a year drops the monthly down from £3500 to £2900. There are tax benefits. Don't pensioners pay less tax £ for £ than a PAYE as they don't pay national insurance or do I have that wrong? Meaning your net will be higher, about £125 on £20.5k a month?
Small amounts but probably works out for most that £20.5k of pension is worth closer to £45k of pre retirement income allowing for national insurance, mortgage, car, commuting/work costs?
Its surprising how much money people do waste on over paying for utilities, mobile phones, Sky, beer, going out, eating out particularly eating at work, etc. not just cars.
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