At What Point Would You Be Comfortable with Dropping $60K into a Car ?

Evening ladies and gents,

I am in mid 20's and have been a massive fan of performance cars since my teen years and have owned a few good cars in past, I would blindly spend money on cars or parts without thinking about consequences, I currently own a car which would have market value of between $20K-$25K if I sold it.

I recently became obsessed with CLA45 AMG and the ones I like are between $60K - $80K.

I do currently own a place and have some savings aside but think it's still a stupid decision to spend all this money on car and not on investment property but would love to hear your feedback ! at what point of life you would be comfortable with spending that sort of money on (High Yield Investment) Car ?

Comments

  • never

    • +78 votes

      If you're making 100K a month why wouldn't you? It's all relative.

    • Yea all depends on what makes you happy and what you personally value. I love driving manual high power performance cars. It’s worth it to me personally without question, to spend that kind of money, because it’s what I enjoy. To others it may be entirely different, so I don’t feel I can answer for someone else. I’m lucky enough to be able to spend it, but the reality is that it comes down to how much you are willing to sacrifice (now or in the future) for what you want to pay - everyone will have a different answer.

      • Sometimes it depends on your circumstances:
        Live in rural areas and pretty much $50k is the minimum price for a decent 4WD. The benchmark for these people is a GXL Prado about $65k.
        Ditto anyone thinking of towing anything. Even if you go large SUV you are talking that kind of price.
        Three kids + and need a seven seater?
        People Movers? The carnival is the best option and it tops out at $65k before on roads
        A decent sports car?
        Anyone wanting a prestige brand.

        I am looking at a three row large SUV to fit my family’s needs. You can get a povo pack below $50k, but interestingly all manufacturers seemed to have positioned the models with a decent amount of kit around the $60k mark (non German brands I mean). Top end Mazda, Hyundai and Kia are nudging $70k. A Q7 Audi with similar kit is around about $130k.

    • Max out your super 25k/yr. Play with the rest of the money.

      Super is a low tax environment(15%), rather than your salary. You can have a much much nicer car / overseas holiday / retire early in the later stages of live. Takes a small pebble to create a snow ball then turn into an avalanche.

      • Most people would rather pay the extra tax and spend it now. No point being 55 and driving a nice car.

      • There is also every chance you may die before you see your super. Life is for living… if you enjoy driving performance vehicles and have a passion for it then go for it !!

        You only get 1 chance on this big rock.

        • There is also every chance you may die before you see your super.

          if you enjoy driving performance vehicles and have a passion for it then go for it !!

          There's also probably some small correlation between these two statements

        • Statistically there is a very high chance you will live to see your super (for those who don't have a life threatening illness).

          And if you're 65 with little to show for it, the idea of YOLO thinking when you were younger will be cold comfort if that was the cause of ending up with little. Potentially there is still a lot of life to live from 65.

          • @acersaurus: You can access super from 60. :) And with the tax you can save you’re probably better off with a car loan + extra super vs paying for the car in cash and no extra super. Assuming you’re in a decent tax bracket..

            But hey you could die next week so spend all your money on hookers and blow.

    • Ditto, because if I was ever that rich to justify it - even if I was a billionaire, id still rather buy a 30k car and give 30k to charity.

      That said cars aren't my hobby.

    • Depends on income. If you made 10 million after tax, you would drop 60k for a car.

  • Someone I known spent alot of money on cars when young. He regrets that now as he is near retirement and does not even fully own one small appartment .

    • I spent a fair bit on cars when I was younger and do regret some of it (did buy a $70k car in my mids 20s and that's one that does fall in the regret column) and would definitely advise others against it but I've been lucky enough to always have high disposable income and at least own my house in Sydney outright, managed my super and investments fairly well and am probably still 15 years away from typical retirement age yet could probably semi retire now if I wanted to.

      Any amount is relative to an individuals circumstance. Even today I certainly wouldn't be spending $60k on a used Euro vehicle but $60k on something new with the intention of keeping it long term is something I'd consider.

    • Depends… If you think about it very very carefully, allocate fund that you can def afford, take v good care of the car, buy as new (<1 y.o.) rather than brand new, and sell no more than 1-2 yrs later before next model release, then it may be worthwhile. I did exactly that in my 20s, lost about 10-20k in total driving 2 different $70k sports car, best decision ever. No regret whatsoever. I now make more and can prob afford it but have lost interest. I get more excited about the upcoming Kia carnival - something I had zero idea why anyone would ever buy when I was in my 20s.

    • LoL his regret should not be regarding his cars, but his mindset. Even if he had no cars he'd still be in a very similar position…being near retirement and not fully owning his own small apartment.

  • +106 votes

    Beyond this website's hivemind, $60k isn't actually a lot of money for a car. It's a personal decision based on your needs, wants, living situation, income and choices. There's no right or wrong answer that suits all.

    I would be comfortable spending that much on a car as long as it's paid in cash (i.e. no loans) and have plenty more reserves that there's no current opportunity cost of being able to reasonably buy something else.

    Having said that, a 45 AMG looks impressive in your 20s but it really isn't. At the end of the day, it's a small car (albeit with decent engine), extremely stiff ride, high running costs, the pops and bangs get old quick and isn't a real AMG in many people's eyes.

    Focus on career and get a proper 63 AMG when you feel the time is right.

    • I'd aim for an E63

      • -12 votes

        stupid car costs too much in fuel. Rides nice though in comfort.

        • People who can afford these type of cars don't worry about fuel prices.. lol

          • @FocusRider: The ones that buy 10 yr old ones do

            • @picket23: I picked up an early E63 to satisfy my midlife AMG 6.2L desire. <10L/100ks on the highway but around town is nasty; may have something to do with the constant acceleration and braking. I chit chat with the guy at the local service station to take my mind off the cost when I fill up but it's worth every cent having bought sensible cars for the last 20 years.

        • The true mark of being able to afford a mercedes is in being able to afford the maintenance. If you're worried about fuel, then yea, definitely gonna scream at an AMG. Generally your wearing parts cost a lot more; sporty brakes, expect to pay something like four times the cost of the regular model.

    • -5 votes

      $60k isn't actually a lot of money for a car

      The only time $60k doesn't seem like a lot of money for a car is when your property went up in value by hundreds of thousands of dollars thanks to continued government intervention in a broken market.

      But those who haven't been lucky to profit off an ever more exclusive property market don't have that kind of spare cash floating around.

    • $60k is a lot for a car, any way you look at it.

    • Thank you, after giving it a bit of thought I think hat it's not a very wise decision so I'll happily drive the car I have hopefully for few more years

      • You can consider getting it wrapped professionally and that will give you that boost to fall in love with what you got and be enough to cool a new purchase for a few years. Money well worth spent IMHO. Other cheap but effective ways to fall in love with the car again is to Plasti dip the wheels, a few pin stripes etc.

      • +1 vote

        Get an i30n.

        Does all the same stuff cheaper, more reliable and without biting 30k of depreciation.

    • I've seen 2015 c63s for mid 80s.

      If you're buying a cla45, I would get 2014 model for 40k!

      I've seen m4s for mid 50s and they were 180k new!!!

    • Yes very much hivemind mentally especially when it comes to cars on this forum.

    • Agree 1000% with the pops and bangs. Very tacky. It's quickly turning into the [email protected] car IMO.

  • Invest in (buy) property, and I mean primarily dirt/land (house optional on that land, but defo' do not buy an 'apartment' or anything that involves a 'body corporate' of any description). 'Muck around with' cars for fun/sh*ts and giggles. There's a very big difference between the two. The land you buy steadily goes up in value over the years. Sometimes, if you're lucky/buy well, it can go up a whole heap in just one or two years. Conversely, any car you buy goes down in value over the years … or costs you thousands to maintain/drive/retain its sale value, or both.

    • another spin to it is when you buy property, you are buying the land. the house (structure) is free and a bonus. some are a bigger bonus/freebie than others.

      • That's just stupid. Using that logic two houses next door to each other on the same size land should be equal value. One is a run down, asbestos riddled shit hole. The other is a 5 bed 3 bathroom with high end furnishings… I wonder which would cost more.

        • Nah mate it's the vibes and the serenity. And Mabo.

        • That's just stupid.

          No offence hozmo, but it is a tad … erm … 'simplistic'. Think about somewhere where land is relatively 'dirt cheap', for example. On beautiful Russell Island (or thousands of other similar non-capital-city locations around Australia) you can buy a decent block of land for 20K. That same block with a new house on it though, will cost you an absolute minimum of 200k.

        • It's simplistic but accurate when looking at an increase or decrease in asset value which is what the discussion was about - the actual value of a house is pretty static and will depreciate over time as it gets older/more run down but the value of the land is appreciating. If you're looking at it from purely an investment perspective the house is almost irrelevant…

    • Any car goes down in value over the years ? This is not a true statement at all. Many cars have appreciated. Even some early 2000 cars have appreciated.

      • 10-frames

        Even some early 2000 cars have appreciated.

        That's interesting, can you tell me a few of them?

        I am absolutely not doubting you (I know jack about cars, virtually all I know is that I like my old Ford MKII; fragile ignition system and now essentially absent 'central locking' system and all) … I would genuinely like to know which cars that are less than 20 years old have actually appreciated in value though. Are you talking about a select few high-end limited-issue sports cars?

        • The only cars appreciating in value would be the sports cars. Nissan Silvias are appreciating like crazy, s15's being the early 2000's version of the Silvia range, they were going for $13,000-$16,000 a few years ago, now they're worth $35,000~+. one of the most popular cars that has absolutely skyrocketed is the Skyline GTR34. If you owned one when they were 30k a few years ago (people were saying it's ridiculous to pay that much for an old sports car) you'd be laughing all the way to the bank. They're worth upwards of $200,000~ now. The more basic versions, R-34 GTST's were worth around $15,000 back then. Now they're at $35,000~ plus, assuming it's a Coupe and a manual. Hell, even the non Turbo R34 GT version is expensive as hell now if you get it in a coupe/manual combo.

          • @spacemannn: I really regret not buying a near stock R32 GT-R 15 years ago when I was looking. Bought a ~4 year old WRX instead as the GT-R was already ~15 years old. The only ones on car sales now are pushing 100k for a car that was <$20k then.

        • HSV's have gone up for sure. Combination of Holden closing and COVID. Depends which model but the rarer ones have gone up substantially. I've got a 2002 GTS which I've had for about 15 years. Purchased for 45k back then, probably went as low as 30k over time but now would easily sell for 80+. Rarely see them for sale, last couple went over 100k.
          Late model (2013 onwards) Gen F's have turned around quickly. I was looking at getting a GTS or Senator a few years ago, could grab one for about 60k. Now they're 90-100k. 2017 GTSR's were about 100k new, now they're fetching north of 150k. 50% gain on something that should have dropped 50% in that time is pretty crazy!

          • @whitelie: OK wow, thanks for the information you two. Assuming that it's all true/legit, my answer to the OP has now changed completely, to this:

            'At what point would you be comfortable with dropping $60K into a car ?

            Answer:

            At the point where I thought I knew enough about the car to have a reasonable expectation that it would actually appreciate in value substantially every year, rather than depreciating in value.

            There is a proviso though. I wonder how much $$$ the owners of these very select few 'appreciating sports cars' have been required to spend on running them day-to-day, maintaining/servicing them, and insuring them over the years … but in turn, I guess that also has to be weighed against the joy they have had driving them …

            Anyways, what recent model sports cars do you two (Spaceman and Whitelie) 'tip' are going to increase in value over the next decade or so?!?

            • @GnarlyKnuckles: HSV's are a hard one, I think the price has driven up substantially in a very short period of time, so no idea if they will keep trending up or come back down before going up. They don't make them anymore, so long term I think they will go up but not sure I'd buy one now for investment. IMO it's very hard to gauge what may go up and if you've already missed the boat on some models. I don't think it's wise to purchase a car to make money on, purchase it for the enjoyment it brings. Better off throwing the money in the stock market somewhere if you want to make money but that's just my 2c.

              • @whitelie: LOL, okay cheers … not sure about the stock market (the word 'crash' scares me!), so I guess I'll stick with the old faithful idea of 'dirt' (property/land; in my case cheap stuff with no house on it).

                Nowhere near as fun as a flat car though :(

                I was hoping you would be able to direct me to a reasonably new-model sports car that I could 'invest in' AND 'rip up the streets' with … no such luck I guess … :(

                • @GnarlyKnuckles: My best guess for a reasonably new sports car that would appreciate or at least hold value well would be the new GR Yaris. If you were lucky enough to pre-order the first 1000 cars @ $40K, you would've 'made' around $10k as people are already selling theirs on Carsales for $50ish K (as the normal price starts at $50K after the introductory offer). The good reviews that have come out have also built hype and demand for it. E.g. TopGear gave it a 10/10 (only 6th car to get that score, joining cars like the LaFerrari, McLaren P1). Also for WRC homologation, Toyota are only required to produce 25000 cars (may make more) and apparently dealers are already struggling to meet demand in Aus (cannot confirm anything as I only saw forum and fb posts about this).

                  So good reviews + high demand (?) + limited quantity (?) + Japanese = IMO a car that will at least hold value/ not depreciate as fast, or possibly appreciate but that's just my opinion.

                  • @Tony0962: You're a legend Tones, thanks for this insightful/knowledgeable response. This forum has really taught me something about buying sports cars … it is not necessarily a 'money sink'.

                    I bet there's some good mechanics out there who specialise in working on sports cars, and actually make bulk cash by buying them, tuning them up, then flipping them sometime later at a good profit … all the while getting to spin around in them …

                    Man, I chose the wrong profession :-(

        • @GnarlyKnuckles

          All these replies are spot on, they are future classics. In basic, some factors that help with the appreciation are but not limited to; being an honest fun car to drive, discontinued product lines, limited models and a plethora of highly raved reviews. However with these future classics, they will depreciate to a point where there is a "bottom" in price before it rises and that may take a few years or decades to realise or even see.

          In regards to the cost of owning one, It is definitely heavily in favor of joy and entertainment. Some of these early 2000 cars will reach 25 years soon which the VIC state will allow the vehicle to be registered for club permit which is defined "to make limited non-commercial use of eligible historic vehicles on the road network", thus reducing the yearly registration substantially. I am sure other states have something similar.

          And with all classics, you cant walk into a dealership and buy them new.

        • There is a reason the Tax Office does not let you claim cars as an investment as they almost always lose money.

  • When i had 20x the investment capital.

  • When 60k isn't a house deposit anymore.

  • The first car I bought was $16k and I was making like $64k, so… If I had a $240k income?

    Alternatively I would also purchase a $80k car on my $50k graduate salary as an investment in myself 😁