Yet another finance question...
Discussion
Out with some colleagues, all claim to be "petrol-heads" but all have different views on how much to spend on the next car and whether to finance or buy outright.
Here is what has been discussed:
An individual with 2.3m of assets out of which just over 300k is cash, rest is prime location properties with no mortgages. No wife, no kids. single guy in his late 30s, currently earning 250k a year.
Spending 100k to 150k on a nice sports car shouldnt be a problem (at least thats what i think). The other guys are arguing that he shouldnt spend more than 50k.
So we thought we consult you nice people and get your opinions.
Thank you
B
note: Yes we have nothing else to do on a friday night other than talking about cars and money.
Here is what has been discussed:
An individual with 2.3m of assets out of which just over 300k is cash, rest is prime location properties with no mortgages. No wife, no kids. single guy in his late 30s, currently earning 250k a year.
Spending 100k to 150k on a nice sports car shouldnt be a problem (at least thats what i think). The other guys are arguing that he shouldnt spend more than 50k.
So we thought we consult you nice people and get your opinions.
Thank you
B
note: Yes we have nothing else to do on a friday night other than talking about cars and money.
Topbox said:
Based on what I have just spent on my new (used) car vs what I earn:
He should not spend more than 30k.
You can consider me to be Mr. Sensible. I'm sure someone will suggest a Veyron shortly!
TB
I'll edit that based on no mortgage and a place to live. I'd say 150k ish but I'm sure he could spend far less and get something awesome.He should not spend more than 30k.
You can consider me to be Mr. Sensible. I'm sure someone will suggest a Veyron shortly!
TB
mrburgen said:
Out with some colleagues, all claim to be "petrol-heads" but all have different views on how much to spend on the next car and whether to finance or buy outright.
Here is what has been discussed:
An individual with 2.3m of assets out of which just over 300k is cash, rest is prime location properties with no mortgages. No wife, no kids. single guy in his late 30s, currently earning 250k a year.
Spending 100k to 150k on a nice sports car shouldnt be a problem (at least thats what i think). The other guys are arguing that he shouldnt spend more than 50k.
So we thought we consult you nice people and get your opinions.
Thank you
B
note: Yes we have nothing else to do on a friday night other than talking about cars and money.
As usual...Here is what has been discussed:
An individual with 2.3m of assets out of which just over 300k is cash, rest is prime location properties with no mortgages. No wife, no kids. single guy in his late 30s, currently earning 250k a year.
Spending 100k to 150k on a nice sports car shouldnt be a problem (at least thats what i think). The other guys are arguing that he shouldnt spend more than 50k.
So we thought we consult you nice people and get your opinions.
Thank you
B
note: Yes we have nothing else to do on a friday night other than talking about cars and money.
The Moose said:
Topbox said:
The Moose said:
How much does he want to spend on a car? That's what he should spend. Simple really.
What does he want from a car?You're saying spend what he wants because he's got loads of cash. Lets say he wants to spend 100k and has no idea what he wants. He spends 100k and buys a 50 year old 3 wheeled banger but because he has the cash that's ok.
He might want a fast car: could spend a million pounds or 100k on equally fast cars.
He might want a convertible: could spend 10k could spend a million.
He might want a great handling car: 3k or a million.
He needs to decide what he wants to achieve and assess different costs.
His investment strategy is all wrong, too much tied up in property. He should sell some of the property and invest the proceeds in the stock market, invest some of the £300k in bonds and make sure he takes up his tax-free ISA allowance 
From other threads it would appear that leasing is the best alternative for the top end of the market, so that would be the way to go.
On the other hand as I am poor and bought my car, he would probably do best by ignoring my advice completely and blowing it all on a DB5
From other threads it would appear that leasing is the best alternative for the top end of the market, so that would be the way to go.On the other hand as I am poor and bought my car, he would probably do best by ignoring my advice completely and blowing it all on a DB5
Topbox said:
Based on what I have just spent on my new (used) car vs what I earn:
He should not spend more than 30k.
You can consider me to be Mr. Sensible. I'm sure someone will suggest a Veyron shortly!
TB
If that guy should only be driving a £30k car then most people are way over leveraged! He should not spend more than 30k.
You can consider me to be Mr. Sensible. I'm sure someone will suggest a Veyron shortly!
TB
Diminishing returns, I'd say...
He can easily afford a £100k car and it won't break him financially if he does.
However if he gets 95% of the pleasure from a £50k car, I can't see how he won't do better from spending that extra £50k on coke, hookers, or turnips for that matter.
I see no reason why he shouldn't start looking for something fast and pleasant like this
http://www.ebay.co.uk/itm/Audi-R8-4-2-Quattro-HIGH...
But if he sees £50k more value in this, then he probably knows his own mind well enough, having got to that position in life, to be trusted.
http://www.audi.co.uk/used-cars/used-car-locator/r...
While I normally argue for newer cars, assuming that this is a low mileage, high performance second car and not a motorway weapon for the daily drive, I'd go for the grey car.
He can easily afford a £100k car and it won't break him financially if he does.
However if he gets 95% of the pleasure from a £50k car, I can't see how he won't do better from spending that extra £50k on coke, hookers, or turnips for that matter.
I see no reason why he shouldn't start looking for something fast and pleasant like this
http://www.ebay.co.uk/itm/Audi-R8-4-2-Quattro-HIGH...
But if he sees £50k more value in this, then he probably knows his own mind well enough, having got to that position in life, to be trusted.
http://www.audi.co.uk/used-cars/used-car-locator/r...
While I normally argue for newer cars, assuming that this is a low mileage, high performance second car and not a motorway weapon for the daily drive, I'd go for the grey car.
Topbox said:
The Moose said:
How much does he want to spend on a car? That's what he should spend. Simple really.
What does he want from a car?He wants a sports car. Ferrari 599, california, sls, 911 turbo ....are some of the cars he mentioned.
From what I could see, his problem is he doesnt think he is rich enough to spend 100K on a car !
and thats how the discussion started last night. With assets over 2m , you should be ok to spend 100k on a car.
mrburgen said:
Both relevant questions....
He wants a sports car. Ferrari 599, california, sls, 911 turbo ....are some of the cars he mentioned.
From what I could see, his problem is he doesnt think he is rich enough to spend 100K on a car !
and thats how the discussion started last night. With assets over 2m , you should be ok to spend 100k on a car.
How much are you happy to throw away on a nice car? He wants a sports car. Ferrari 599, california, sls, 911 turbo ....are some of the cars he mentioned.
From what I could see, his problem is he doesnt think he is rich enough to spend 100K on a car !
and thats how the discussion started last night. With assets over 2m , you should be ok to spend 100k on a car.
Buy a £150k Ferrari and sell it in 3 years for £50k, is he happy to loose £2700 a month? Will he get £2700 worth of enjoyment out of it?
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