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Does this make sense?

 
Old 03-11-2019, 12:22 PM
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heroicdeath
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Lightbulb Does this make sense?

Hey guys,

I'm about to graduate and am returning full-time to a company I've interned at this past summer. Full-time salary is $87K + stock options, now since I was an international student at UofT, I've been paying $$$ for tuition (which I completely understand), so I do have a fair bit of tax credits.

I'm thinking of financing a CPO 911 C2S from 2017 or a CPO Panamera GTS from 2016. The 911 C2S is listed for $102K at Porsche Oakville and the Panamera GTS listed for $95K at the same dealership. I have about $30K in savings and no debt.

Does it make financial sense to make the purchase? It would be a $20K downpayment with financing handling the rest, for a 48 month term it'd come to 1500-1900 a month tax included.

It's always been a childhood dream of mine to own a 911 C2S ever since I was 6 (18 years ago jesus). I absolutely love cars with passion, and coming from Singapore (where cars are at least 3x the price here, and you can only keep them for 10 years at a time, this is what is pushing me to make the decision).

I'm based in Toronto too!
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Old 03-11-2019, 12:43 PM
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It makes zero financial sense for you to even contemplate this.

However, guys have been doing dumb things for cars and pu$$y since the beginning of time.
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Old 03-11-2019, 12:51 PM
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Originally Posted by heroicdeath View Post
Hey guys,

I'm about to graduate and am returning full-time to a company I've interned at this past summer. Full-time salary is $87K + stock options, now since I was an international student at UofT, I've been paying $$$ for tuition (which I completely understand), so I do have a fair bit of tax credits.

I'm thinking of financing a CPO 911 C2S from 2017 or a CPO Panamera GTS from 2016. The 911 C2S is listed for $102K at Porsche Oakville and the Panamera GTS listed for $95K at the same dealership. I have about $30K in savings and no debt.

Does it make financial sense to make the purchase? It would be a $20K downpayment with financing handling the rest, for a 48 month term it'd come to 1500-1900 a month tax included.

It's always been a childhood dream of mine to own a 911 C2S ever since I was 6 (18 years ago jesus). I absolutely love cars with passion, and coming from Singapore (where cars are at least 3x the price here, and you can only keep them for 10 years at a time, this is what is pushing me to make the decision).

I'm based in Toronto too!
I would say no it does not make sense, unless you live in your parents basement and have no other major expenses like a mortgage. Your take home will be about $5200 per month after taxes. $1900 works out to 36% of your monthly income. Also think about if you plan on applying for a mortgage any time soon, the new stress test may kill your options if you have that large car payment.

My advice would be to buy something used with your 30k, as your first Porsche. Less risk and will get you started.

Also you may want to put some time in at your new job before you start spending on luxury items. Just my 2 cents.
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Old 03-11-2019, 12:58 PM
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[QUOTE=Jamie140;15695607]It makes zero financial sense for you to even contemplate this./QUOTE]

Exactly what he said.

You are about to graduate start to earn new graduate salary, and are wondering if it makes sense to go $80k into debt (more with interest), taking on a $2k/month payment, in order to buy a $100k car because you want it?

Do not do this. The way to wealth is to live below your means, not way beyond it. There are loads of awesome cars, for less than half that, and I would not take on more than $25k total cost if I were you.
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Old 03-11-2019, 01:27 PM
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What are your other monthly expenses? Do you receive any $ from your family?
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Old 03-11-2019, 01:33 PM
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Originally Posted by moab View Post
What are your other monthly expenses? Do you receive any $ from your family?
Ah probably rent that would cost $1900 a month, but other than that no real monthly expenses. I do receive $1400 per month from the trust fund that I have, that will continue paying out till the age of 30 (6 years left).

But thanks for the opinion guys, it's definitely good to hear it from another person's point of view. I will probably forgo this purchase and wait till I have enough to put 75% downpayment. I don't have any intention of purchasing a property here (granted this may change), since with tech my next move might be to the states.

I'll try to negotiate for more $ with the recruiter.
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Old 03-11-2019, 01:42 PM
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In 2001, the average income of a 911 buyer was over $300,000.
In 2017, the average income of a 911 buyer was over $500,000.

The last report I saw was that it is now over $600,000 (USD) and the average income of a Boxster/Cayman owner was $365,000 (USD).


I've always pushed my limits a little when it comes to cars (heart > head) but I would NEVER even think of buying a 100k car with an 87k gross income.

There 2 ways to look at it...
1. What is your income?
2. What is your net worth?
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Old 03-11-2019, 01:55 PM
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Originally Posted by Jamie140 View Post
It makes zero financial sense for you to even contemplate this.

However, guys have been doing dumb things for cars and pu$$y since the beginning of time.
LOL Jamie!

OP...I make a lot more than that and I wouldn't contemplate those monthly payments!
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Old 03-11-2019, 02:08 PM
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You should also look at this from opportunity-cost perspective. If instead of throwing that money on a car, you invested that same monthly amount for 3 years, then just let it sit until you reach 60, at 6% you would have close to $465,000.
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Old 03-11-2019, 02:22 PM
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Makes zero financial sense and I cant be the only one wondering what you were quoted as far as the annual insurance premium. 😳
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Old 03-11-2019, 02:28 PM
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I didn't even think of the insurance cost!

911's are always very cheap to insure...but the OP is under 25....
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Old 03-11-2019, 02:49 PM
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Get a used 1st gen Cayman for around $20-25k. Pay it off and drive the hell out of it.
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Old 03-11-2019, 02:56 PM
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$100,000 car + taxes = $113,000 - $20,000 down = $93,000 to finance over 4 yrs @ say 5% = $2100 per month. Insurance at your age would probably be $250 - $350 a month, assuming you already have current coverage & driving experience. If not, I can see it would be even higher. Gas would likely be another $300 - $350 a month (estimate). Without other car sundry expenses (like setting $ aside for repair & maint.), you are already looking at $2,700 range a month.

The question is can you do this for 4 yrs. This will certainly require some serious commitment.

I think what make more sense would be to save as much as you can and pay off any debt, if your dream is to have a 911, what's another few more years of waiting. In this way, you are not 'car poor'.
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Old 03-11-2019, 03:02 PM
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X2 on the used Cayman.
Pay off your student loan. Your student loan is not interest free?
Pay off $1ook now, or pay $2ooK over a 20 year term. There is a 100k car in there in difference.
Patience Porchewan.
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Old 03-11-2019, 03:07 PM
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Originally Posted by BIG smoke View Post
X2 on the used Cayman.
Pay off your student loan. Your student loan is not interest free?
Pay off $1ook now, or pay $2ooK over a 20 year term. There is a 100k car in there in difference.
Patience Porchewan.
I don't have any debts, no student loans. But I do see the point everyones making, heh thanks everyone!
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