SeanPatrick31

Just a few general guidelines on personal finance. 1) As others have said, max out 401(k), consider additional savings in IRA (at your age, go Roth). 2) Save six months of expenses in cash for an emergency fund. The emergency fund is only for "emergencies." This can be bare bones expenses, but be honest with yourself on projected expenses. 3) Save 20% in cash for a home down payment. Estimate a purchase price if you are not yet sure of where you want to live. 4) Pay cash for a car.

Buy the Porsche if you have these covered. If not, then I would wait.

Just my opinion though.

sandwedge

Well...that's hard to argue with but I can't help but thinking of all the driving pleasures I would have deprived myself of over the years had I stuck to that formula. You'll cringe when you hear this but I bought my first sports car - a 1971 TR6 when I was still in college....with student loans, selling vacuum cleaners door-to-door for play money. Highly individual decisions I understand but some of us have to reap some rewards for long hours and hard work rather than just looking at savings accounts getting fatter. I've continued along this set of principles doing just fine financially.

provoste

Wow. $1M net with before getting a P- Car huh? So should you have a net worth of $350-400k before considering an E36 M3 by that formula? Pretty sure I wouldn't be reading this kind of talk on an air cooled forum....

madant15

I am currently in this boat being 24 and living in Silicon Valley, where a decent condo is upwards of $600K-700k and consequently means that buying one will make you house poor during your prime years of "freedom". So instead, I decided to pull the trigger on a 997.1 C2S about 10 months ago and will wait until it is paid off and my income increases further before buying a house. Moral of the story, every situation is different but at a minimum you need to consider the following items:

-Retirement allocation (use online retirement calculators to get a realistic idea of your required contribution in order to retire comfortable at a reasonable age)

-Porsche running/ maintenance cost (reduce with DIY and independent specialists)

-Additional disposable income (you are only young once, have memorable experiences and make the most of it)

-"Oh ****" emergency fund

-Saving for eventual real estate purchase

I would take the above into account and run your numbers again. However, I doubt they will make sense with an income of $64k/ yr.

My $1.72 adjusted for inflation

dasams

My point is, save your money first and buy your toys later. Let's assume you're diligent and reach your $1M net worth. Also assume the next year, your crappy investments only return 3.4%. Guess what? That just paid for the OP's 997.1 and you didn't have to touch your principal. I also doubt that you'll read this on the air cooled formula

Perk10

You've got to be kidding. OP isn't talking about buying a brand new Turbo S. He's talking about a 30-35k car.

In your opinion, what should he be looking at? A 1996 Camry with 200k miles? I mean what's the big deal, really?

At 1M net he probably wouldn't be thinking about a 30k car. I just think that the "Porsche brand" is holding way too much water in this case. Pretend for a moment that the car in question is a fully loaded Honda Accord which he plans on keeping for a really long time and doing most of his own maintenance. Should he wait until he's worth a mil? 3/4 of a mil? I don't get it.

PrimeMvr

You seem to be leaving a lot of items out of your budget, which I can relate to when I was younger. I've learned that when you bother to calculate whether you can afford something, you likely can't. Insurance on a $40k 911 is more than a $40k Toyota. My $60k Lexus is $500/yr cheaper to insure than the 997 I paid $60k for and it doesn't get driven for 5 months of the year. And I get discounts for age (44), perfect driving record, 6 cars, house, umbrella, all with the same company. Check mark in the wait for it column.

You're talking about buying a high mileage car as a daily driver. Maintenance is much higher than "normal" cars, even Bimmers and if you DIY. These cars are solid, but like any car, things break out of the blue, but on a 997 it often costs several grand to fix. If you can pay cash for that kind of repair and not get a knot in you're stomach, that's one check mark in the go for it column. Also, you won't get half the tire life you get on a Toyota and they cost twice as much.

You have a nice income for your age and it sounds like you live in a reasonable cost of living area. Another check mark in the go for it column.

$100/mth into your retirement is NOT ENOUGH. The more you pump in now the better off you will be later. Fire up a compound interest calculator with $10k/yr for the next 15 years compared to $1k for the next 40 years. It's the difference between praying the government figures out the social security mess and knowing that they won't and not caring. You also must have a MINIMUM of 6 months all-in expenses in CASH that you never touch.

If you want a house, there's another cash (or low risk, liquid mutual fund) account you need to establish now. Do the math: minimum 20% of house value you are likely to buy divided by how long til you want to buy. Get saving.

Even though interest rates are silly-low, car payments suck. When I bought my last car, the dealer offered 1.5%. Rather than selling some stock and paying cash, I took the financing. Even though the payment automatically comes out of my account and it has no impact on my budget, it drives me freakin' crazy. My wife has next dibs on the car cash account, so one of these days I need to talk her into cashing something else out to pay that dang thing off.

All my rambling comes from living on all sides of the income/expense ratio and I see a lot of me in your current debate. From 20-30 I lived paycheck to paycheck, usually not even that well. If I wanted something I bought it. YOLO before it was a cute acronym. The day to day stress was ridiculous. Then I got serious about eliminating debt and paying cash for things. You're already ahead of where I was then, so good job. If you can keep your spending discipline ahead of your income you will be amazed at what you end up with in a few years and how much more you enjoy every day.

niche

I don't know... when is buying a Porsche a sensible decision? For me my cars are therapy so...

Life is short

91469972

OMG I make $400,000 a year and with Calif taxes I am not rich! I was lucky during 2010 and found my 911 S $20,000 off sticker. If you have questions just think!

Vape NYC

While we all now have a clear accounting of your finances, I think you forgot to include a few categories in the budget. I didn't see any itemization for booze, coke and hookers. It's helpful to be as thorough as possible.

GSIRM3

Is that a heavyweight or welterweight?

CamsPorsche

The only way I was able to get into a Porsche was via buying and selling cars and receiving bonuses from my employers allowing me to pay cash for it. Otherwise I'd be driving a STI or something similar...

I'm having the brakes and belt done on my car today...I'll post up the cost for you.

This being said I'm laughing at the idea that you need to have assets worth $1 million...what a joke. I've been quite successful in my career and with cars and although I own 3/4 of my home with a mortgage still outstanding and some nice investments, by no means do I have a net worth of $1 million (remember net worth is what you actually own that can be converted to cash relatively quickly).

That's a hard one for 90% of the population to achieve in their 30's let alone 40's.

Save a nest egg, invest in a home, save some money for retirement and then see what you have to play with thereafter.

targaC4S

Neither a house nor a 401k can guarantee you any return in 30 years. A 911 however, can guarantee you enjoyment right now. Until something breaks and your stuck with a 5800 dollar bill for something stupid.

mattyf

Food for thought...

Monthly credit card: $3k-8k
House payments: $4k
Kids daycare: $2k
Retirement: $3k

My used 06 997 payment: $350
One of these things is not like the other.

Jake951

Among Porsche owners, a net worth in excess of $1M is far more common than you might think. For example, look at this poll taken on the GT3 forum: https://rennlist.com/forums/991-gt3/...highlight=poll. Nearly 60% have a net worth over $3M. Fewer than 8% have less than $750k. Admittedly GT3 owners or would-be owners are probably on the high end of the spectrum but the point is that P-car people are high net worth folks and other surveys I have seen bear that out.

Having said that, it may not be absolutely necessary to be a millionaire to own a Porsche, but it makes the cost of ownership a lot easier. You never want to stretch yourself financially to own any "toy" like this.