What portion of your income should be spent on cars ??

[HustleRussell]

Tuvra said:

Audemars said:

Buying a car should be like buying two large kitchen/household appliances. It shouldn't be like paying rent or a mortgage.

So for the average wage (approx £30k per annum) person £3k max every 10 years.

Well that is tbe sensible approach. Problem is that most people are not intellectual enough to be financially sensible.

So what your saying is someone sensible earning £300k a year can barely afford a Civic Type R?

Behave!

Depends on how much they spent on large kitchen / household appliances apparently.

In fairness he didn't say that somebody earning 300k couldn't afford a Civic type R, only that if they were to purchase one it would indicate that they are not sensible, intellectual or financially sensible

[SuperchargedVR6]

Roger Irrelevant said:

SuperchargedVR6 said:

Stupid numbers anyway. Someone earning £100K is only going to spend £10K on a car?! Yeah right!

Er, my friend earns around that amount and drives an Outback that's worth £3k on a good day. In fact I know quite a few people earning well into six figs who don't give a toss about cars and who drive the same runabout they've had for years. There's a high court judge in my village who's still driving an Escort (a st one, not a Cossie or anything like that).

Well, I was kind of assuming enthusiasts and people who aren't tight. I also know people in that salary band and it's true what they say, the more they have, the tighter they are. Own brand supermarket stuff, go out of their way to save 1p a litre on fuel, charity shop clothes, a fiver in birthday cards, hair cuts once a quarter etc etc.

[okgo]

SuperchargedVR6 said:

Well, I was kind of assuming enthusiasts and people who aren't tight. I also know people in that salary band and it's true what they say, the more they have, the tighter they are. Own brand supermarket stuff, go out of their way to save 1p a litre on fuel, charity shop clothes, a fiver in birthday cards, hair cuts once a quarter etc etc.

I'm not tight. But there is no need for me to spend a fortune on a car, I also shop in Aldi. Not tight, just not being a dhead with money.

My old man did once say, nobody ever got a lot of money by giving it away willy nilly. There's truth in it.

[DonkeyApple]

SuperchargedVR6 said:

Well, I was kind of assuming enthusiasts and people who aren't tight. I also know people in that salary band and it's true what they say, the more they have, the tighter they are. Own brand supermarket stuff, go out of their way to save 1p a litre on fuel, charity shop clothes, a fiver in birthday cards, hair cuts once a quarter etc etc.

It's not about being tight at all. It's about it being sensible and appreciating the value of money and how much goes into earning it.

[turbobloke]

How about as a portion of wealth rather than income? If you're buying your own cars rather than renting somebody else's then wealth has a major part to play. Also renting in absolute terms e.g. monthly payments out of wealth or income but you get my point hopefully. You could earn from £0 to a few £k because you don't need to work (for example) if you're worth £zillions.

Edited by turbobloke on Thursday 30th March 16:35

[David87]

Audemars said:

Buying a car should be like buying two large kitchen/household appliances. It shouldn't be like paying rent or a mortgage.

So for the average wage (approx £30k per annum) person £3k max every 10 years.

Well that is tbe sensible approach. Problem is that most people are not intellectual enough to be financially sensible.

Edited by Audemars on Thursday 30th March 09:51

I've just bought a 6-year-old diesel Volvo estate (a 'worse' car than most nowadays) and you're telling me that anyone who does so should be earning £130,000 and has to keep it for 10 years? What do you spend the rest of your money on?

[moustache]

If we're talking purchase price as a percentage of annual income, then mine is 4%.

I don't buy expensive cars, I don't think you need to spend a lot of money to enjoy motoring.

[del mar]

The value of the our cars would equate to

230% of salary....

I have been lucky with prices going and up and a bonus every now and then

[750turbo]

RobM77 said:

Audemars said:

Buying a car should be like buying two large kitchen/househols appliances. It shouldn't be like paying rent or a mortgage.

So for the average wage (approx £30k per annum) person £3k max every 10 years.

The prodigal son has arrived... been waiting on his comments.

Audemars, for all you relatively new viewers here, does not have a pot to piss in!

[anonymous-user]

turbobloke said:

How about as a portion of wealth rather than income? If you're buying your own cars rather than renting somebody else's then wealth has a major part to play. Also renting in absolute terms e.g. monthly payments out of wealth or income but you get my point hopefully. You could earn from £0 to a few £k because you don't need to work (for example) if you're worth £zillions.

Edited by anonymous-user on Thursday 30th March 16:35

That would be an entirely different discussion - you only need to visit the Supercar section if you want an overload of it. Classic cars have become a hot 'alternative investment asset' along with wine, art, watches, etc. I know someone will be along to state that "Cars are never an investment!" but the reality - at least over the last 10 years - shows a different picture. If you're a car enthusiast and at least follow the market then having 10% of your wealth in cars is not unreasonable. Bear in mind it's not just rare supercars worth millions that trade in this market but also modern classics starting below £10k Like all investments they could plummet at any time but have a read of https://kfcontent.blob.core.windows.net/research/5... or if you just want the broad picture:

[bloomen]

I spend 63.4% of my income on cars every year. If that year's expenditure does not match that percentage I sell parts of the car if it's over, if it's under I feed bank notes into the intake to be incinerated. If there's still £5 to go then I drive over that value in coins repeatedly until they're unusable.

[DonkeyApple]

thecook101 said:

That would be an entirely different discussion - you only need to visit the Supercar section if you want an overload of it. Classic cars have become a hot 'alternative investment asset' along with wine, art, watches, etc. I know someone will be along to state that "Cars are never an investment!" but the reality - at least over the last 10 years - shows a different picture. If you're a car enthusiast and at least follow the market then having 10% of your wealth in cars is not unreasonable. Bear in mind it's not just rare supercars worth millions that trade in this market but also modern classics starting below £10k Like all investments they could plummet at any time but have a read of https://kfcontent.blob.core.windows.net/research/5... or if you just want the broad picture:

Your problem when it comes to true performance of alternative investments is that once you strip out the halo investments that drive the market, take into account the real bid/offer spread (transaction cost), net off storage, maintenance and insurance costs all of a sudden the real performance is absolutely nothing like the numbers these charts proport.

[Joratk]

I pay 20% of my post tax income for my car per month, but insurance is also included in that! 22 y/o, unmarried, no mortgage, '14 M235i.

[DonkeyApple]

HustleRussell said:

Tuvra said:

Audemars said:

Buying a car should be like buying two large kitchen/household appliances. It shouldn't be like paying rent or a mortgage.

So for the average wage (approx £30k per annum) person £3k max every 10 years.

Well that is tbe sensible approach. Problem is that most people are not intellectual enough to be financially sensible.

So what your saying is someone sensible earning £300k a year can barely afford a Civic Type R?

Behave!

Depends on how much they spent on large kitchen / household appliances apparently.

Judging by many of the threads in the Lounge, lots of PHers are spending 50% of their total wealth and future income on their kitchen appliances.

[anonymous-user]

DonkeyApple said:

Your problem when it comes to true performance of alternative investments is that once you strip out the halo investments that drive the market, take into account the real bid/offer spread (transaction cost), net off storage, maintenance and insurance costs all of a sudden the real performance is absolutely nothing like the numbers these charts proport.

Ah - but then you add back in the joy of owning the car and not having to deal with brokers

[CS Garth]

Audemars said:

Buying a car should be like buying two large kitchen/household appliances. It shouldn't be like paying rent or a mortgage.

So for the average wage (approx £30k per annum) person £3k max every 10 years.

Well that is tbe sensible approach. Problem is that most people are not intellectual enough to be financially sensible.

Edited by Audemars on Thursday 30th March 09:51

Delta = π (4X-5) x 66/100 - (Y-Y/0.25)

Where Delta is the percentage of income you should be spending, X is your median tax rate and Y is the price of a Morphy Richards Counter Top Yogurt Maker

[MDMA .]

750turbo said:

The prodigal son has arrived... been waiting on his comments.

Audemars, for all you relatively new viewers here, does not have a pot to piss in!

Or a car

I'm sure when he finishes school and passes his test, he'll be rolling in something heavy.

[DonkeyApple]

thecook101 said:

DonkeyApple said:

Your problem when it comes to true performance of alternative investments is that once you strip out the halo investments that drive the market, take into account the real bid/offer spread (transaction cost), net off storage, maintenance and insurance costs all of a sudden the real performance is absolutely nothing like the numbers these charts proport.

Ah - but then you add back in the joy of owning the car and not having to deal with brokers

Very true. So few brokers are as awesome and magnificent as my good self.

But 'joy' for many classic car owners would appear to come from never seeing or using their cars.

[anonymous-user]

DonkeyApple said:

Very true. So few brokers are as awesome and magnificent as my good self.

But 'joy' for many classic car owners would appear to come from never seeing or using their cars.

... True

[750turbo]

MDMA . said:

750turbo said:

The prodigal son has arrived... been waiting on his comments.

Audemars, for all you relatively new viewers here, does not have a pot to piss in!

Or a car

I'm sure when he finishes school and passes his test, he'll be rolling in something heavy.

Pure Gold here..

http://www.pistonheads.com/gassing/topic.asp?h=0&a...