I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

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Topic Author
preciseman
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I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by preciseman » Sun Feb 17, 2019 4:52 am

So..the 2019 audi's are out and are a brand new redesign. There 2018's that are going for a substantial discount from MSRP (15k+) since they are the old designs and dealerships are trying to clear them out.

I currently drive a 10 year old Lexus ES350, about 110k miles on it. No real big problems, just feel like it's about time to upgrade.

The car will cost approx 48-50k out of door after taxes, title, fees for a pretty much fully loaded 2018 A6.


Would like the community to let me know if this is a really stupid decision. Would be writing a check after I liquidate the amount from my brokerage account.


Age - 25M

Location - Houston, Texas


Assets

Annual Salary - 120k base, variable bonus (0k - 120k)

Cash - $6.4k

HSA - $11.2k

401k - $84.3k (max this out, 19k/year)

Roth IRA - $72.2k (max this out and take advantage of mega backdoor roth which allows me to contribute approx 30k/year to my roth IRA)

Taxable brokerage - $54.6k (this is where I would liquidate to write a check)

Equity in Home - $66.1k



Liabilities
$157.8k on a 15 year fixed rate mortgage (12 years to payoff)

- $1,200/month mortgage

- $417/month property tax

- $91.67/month home insurance



Current Monthly Cash Flow

$10,000 Gross Income

($1,584) Traditional 401k

($2,500) After Tax 401k immediately rolled to Roth IRA as per Mega Backdoor Roth

($1,632) Federal/SocialSecurity/Medicare Tax

($140) Health/Dental insurance premiums

($10) 529 for myself

($1,708) Mortgage/Tax/Insurance

($40) Current car insurance

($615) Employee stock purchase plan

($160) General Utilities (Internet, water, etc)

($400) Food



Surplus per month = $1,211. This is not including my bonus which is paid once per year at the end of Feb.



I've always been a saver my entire life, so really just looking for someone to talk me back on or off the ledge. What are your thoughts? Anything would be helpful!

*EDIT*

I'm going to be honest everyone...

I've done some thinking overnight and it honestly feels like I'm chasing the DISCOUNT instead of the actual car. Like if the 2019 ES350 all of the sudden decided to be 18k MSRP..I would hands down buy that car over the Audi A6.

The reason I'm not considering an A4 is because it doesn't have the same discount as the A6..not even close!

Ugh, decisions!
Last edited by preciseman on Sun Feb 17, 2019 1:09 pm, edited 1 time in total.

Uniballer
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by Uniballer » Sun Feb 17, 2019 5:28 am

Nobody should have more than 1/3 of their net worth invested in a quickly depreciating asset like a car.

Sounds dumb to me.

I seriously looked at a used Porsche 911 when I was 23 (more than 30 years ago). Fortunately I did not pull the trigger.

Topic Author
preciseman
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by preciseman » Sun Feb 17, 2019 5:49 am

Uniballer wrote:
Sun Feb 17, 2019 5:28 am
Nobody should have more than 1/3 of their net worth invested in a quickly depreciating asset like a car.

Sounds dumb to me.

I seriously looked at a used Porsche 911 when I was 23 (more than 30 years ago). Fortunately I did not pull the trigger.
It's only 20 percent of my net worth though :(

Darn I really wanted someone to say it's okay and buy it haha! It's such a gorgeous car!

gclancer
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by gclancer » Sun Feb 17, 2019 5:56 am

Plain and simple, you can afford it. It’ll always be the smartest financial decision to drive a Camry, but for a young kid with his financial house in order and saving 50% of his gross salary? Go ahead and treat yourself to the A6 if you really want it.

Edit: why don’t you wait until you get your bonus rather than selling taxable investments and generating capital gains tax?

Topic Author
preciseman
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by preciseman » Sun Feb 17, 2019 6:05 am

gclancer wrote:
Sun Feb 17, 2019 5:56 am
Plain and simple, you can afford it. It’ll always be the smartest financial decision to drive a Camry, but for a young kid with his financial house in order and saving 50% of his gross salary? Go ahead and treat yourself to the A6 if you really want it.

Edit: why don’t you wait until you get your bonus rather than selling taxable investments and generating capital gains tax?
Bad year on the trading desk..didn't hit our targets. Bonus is only 40k so I might only see a little over 20 after tax withholdings. So basically not enough money.

averagedude
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by averagedude » Sun Feb 17, 2019 6:14 am

You can afford it and you are doing great, however i would vote that you not buy it. In my opionion, buying expensive new cars is one of the most stupid mistakes that i see young people make. At the very least, i think you should put alot of thought about your short and long term goals if you haven't done so already. Determine if a $50000 expense hinders your progress on achieving your goals.

minimalistmarc
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by minimalistmarc » Sun Feb 17, 2019 6:15 am

After the initial thrill will this car actually make your life better/happier?

Also, often once you start buying cars like this you get on a treadmill of escalating costs.

Personally, I think it’s a really dumb thing to spend money on unless you already have financial independence and excess on top of that.

tigermilk
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by tigermilk » Sun Feb 17, 2019 6:27 am

You have it, but I would ask if the A6 is the right car. After owning a BMW in my adult ooife and our family having a VW when I was a kid, I have sworn off German cars. The overall product quality just hasn't been there.

snowox
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by snowox » Sun Feb 17, 2019 6:40 am

minimalistmarc wrote:
Sun Feb 17, 2019 6:15 am
After the initial thrill will this car actually make your life better/happier?

Also, often once you start buying cars like this you get on a treadmill of escalating costs.

Personally, I think it’s a really dumb thing to spend money on unless you already have financial independence and excess on top of that.


+1
This is my answer. Can you afford to buy it yes. But look at what spending money on a car like that will cost you in the long run. Wait until your stash is built up significantly before even considering such a purchase. Cars are only there to get you from point A to point B so get something practical. And as said above , after a couple weeks the newness is over and its just another overpriced car you dont need!

FIre Fighter
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by FIre Fighter » Sun Feb 17, 2019 6:46 am

I bought a luxury car in my mid-20s because I “could afford it”, but in hindsight I was I had not. Two main reasons:

1. While I was saving a good amount back then, I would be better off now if I had taken those car payments and saved even more. Think about how much extra money you can have in retirement with decades of compounding interst.

2. I set a standard of what I wanted in a car that is hard to break. Not surprisingly, my next car was also a luxury car. Once you get used to something, it’s hard to “down grade”. However, if you don’t let yourself get used to a luxury car, then it’ll be much easier to stay content with something less expensive.

Also, from experience, that excitement of a new car wears off after a while. Then you’re just stuck with high car payments, costly maintenance, etc. without as much excitement for the car.

jharkin
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by jharkin » Sun Feb 17, 2019 6:48 am

I would say that’s a lot of car on your income, but then again when I was 27 I bought a 21k Acura on 65k income with a lot less assets so I guess it’s the same.

It’s not an ideal choice financially, but you are at the right time to get a fun car out of your system ... someday you will wake up 40 driving a van with a bunch of car seats ;)

But if your gonna have a 20s crisis, do it right and get an S4 :twisted:

bltn
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by bltn » Sun Feb 17, 2019 6:50 am

That s a little too expensive for you at this stage in your wealth accumulation. You re currently driving a great car for reliability and general transportatin. You might consider keeping it for another 40,000 miles, while your nest egg grows. I had a Lexus 350 es that I sold at 170000 miles. Perhaps the best made car I ve ever had.
I applaude your mindset to pay cash for cars.

chw
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by chw » Sun Feb 17, 2019 7:10 am

It seems like you are looking for affirmation from strangers here to tell you to buy the car. That said, you have already had a mix of thumbs up and thumbs down on this ourchase, as well as the personal experience of several that went through a similar decision at your age. Yes, you can afford it, but there are many people out there that will sell you into a purchase that you can afford, but in hindsight (1,3, or 5 years later) turned out to be a terrible purchase- ask those people that bought a home from 2004-2008 that didn't really qualify(think liar loans), or bought too much home, or kept on using their home to acquire other "things" that quickly depreciated, but retained debt on. I guess what I'm saying will this decision become the first of others in lifestyle creep? I threw in the 2004-2008 timeframe, as it was a period of hyper over buying of things that quickly turned to regret that many could not foresee when the economic collapse occurred, and those that overextended their budgets suffered varying degrees of difficulty.

You seem to be well set up financially for a 25 yo, but ask yourself truthfully what could go wrong, and how would things work out for you? You are the best judge of this- Think economic downturn, and its impact on your industry, and that you are tying up the majority of your free cash in a depreciating asset that will be expensive to insure and maintain vs. a more moderately priced car.

Good luck
Last edited by chw on Sun Feb 17, 2019 8:00 am, edited 1 time in total.

student
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by student » Sun Feb 17, 2019 7:18 am

Your bonus has a huge range so it is difficult to say. If $0 is typical, then I would say no, you cannot afford it. If $120k is typical, then yes, you can afford it. I guess it also depends on your job and whether you need to use your car to drive clients around town. For example, if you are a real estate agent specializing in luxury housing, then I would say you need a luxury car.

HEDGEFUNDIE
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by HEDGEFUNDIE » Sun Feb 17, 2019 7:27 am

I would buy it, but:

1. I would not buy new. You can get a pre owned fully loaded 2018 A6 for $40k OTD. Can go down to the $30s if you don’t need top of the line.

2. I would not buy with cash. Tying up so much money in a depreciating asset makes no sense. Get a 0-2% loan.

A little story for those BHs who are big into depriving themselves unnecessarily. When I was younger I went on regular trips around the world, ate at some of the best restaurants, stayed at some of the fanciest hotels. By age 30 I only had $100k saved in my 401k, but a completely sated appetite for the “good life”. Now that I have a child, I have neither the time nor inclination to do any of those things, nor any wistful regret that I did not live life to its fullest during my single independent years. In the end, if I had saved that money and let it compound, would I have a few hundred thousand more in my retirement accounts by my 60s? Sure. Would I go back and give up those experiences? Not a chance.
Last edited by HEDGEFUNDIE on Sun Feb 17, 2019 7:41 am, edited 2 times in total.

Dupree
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by Dupree » Sun Feb 17, 2019 7:34 am

I find it useful to think about opportunity costs when considering these things.

$50,000 compounded at 5% a year for 30 years will be worth $216,097 when you are 55. At 8% it would be worth $503,132. If you extend that to 40 years (when you'll be 65 and either living or dreaming your retirement plans) at 8%, it could potentially be worth $1,086,000.

Of course you will need a new car at some point in the next few years anyway, so not all the 50K would be compounding. You can certainly afford the car, but there's always a trade-off to be considered.

Grt2bOutdoors
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by Grt2bOutdoors » Sun Feb 17, 2019 7:37 am

Nothing like spending $250K on a car to send the statement - Look at me, I’m a big spender!! No, it’s not a typo, $50K today could very well be worth $250K in 30-40 years.

How’s your job security? You have roughly the same amount of assets in taxable assets. You buy this car and now you have none. I don’t count home equity or retirement when evaluating consumption of a depreciating asset. A home is for living in, a retirement account is intended for retirement only. Are you planning on living in your car come retirement or upon job loss? Imagine yourself in a snazzy used (it’s used the moment you drive it off the car lot) car. Still feel the need for a downgrade?
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions

retiringwhen
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by retiringwhen » Sun Feb 17, 2019 7:39 am

HEDGEFUNDIE wrote:
Sun Feb 17, 2019 7:27 am
I would buy it, but:

1. I would not buy new. You can get a pre owned fully loaded 2018 A6 for $40k OTD. Can go down to the $30s if you don’t need top of the line.

2. I would not buy with cash. Tying up so much money in a depreciating asset is dumber than buying new. Get a 0-2% loan.
+1 look for a 2-3 year one too. If you plan on owning the car for 7-10 years paying $40K is not so bad, But truthfully, what I would do is buy a loaded Accord, Camry or some other standard sedan for $30K and drive it 12 years. It will do more for your net worth than you can imagine and you probably won’t miss the heated steering wheel.

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ClevrChico
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by ClevrChico » Sun Feb 17, 2019 7:45 am

You can afford it, but you will likely regret it down the road.

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8foot7
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by 8foot7 » Sun Feb 17, 2019 7:46 am

I actually don’t think a 50k car in your situation is uncalled for. You appear to be managing your finances well.

My mother in law died at 57 so while the what’ll-it-be-worth-at-65 folks have a point, there is also a non-zero possibility you won’t be around to enjoy it. Balance is necessary to be content. You are saving a lot, are well paid, have an eminently reasonable mortgage on an accelerated pay down, and may even receive the entire cost of the car in a bonus.

80k would be different but 50k? I say enjoy and you can always sell it if your circumstances change.

Cycle
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by Cycle » Sun Feb 17, 2019 8:03 am

It's a dumb decision. Personal cars are for people who do not care about the the noise pollution, air pollution, and sustainability of their lifestyle. Tesla/Prius owners included.

If u save $10k per year that most allocate towards cars, that's $2MM after compounding interest by age 60.

My recommendation would be to move to a city where you can walk or bike to the places you need to go.

Houston definitely isn't an ideal place to try and live sustainably, but there are plenty of people that do it there if u check out r/bikecommuting on Reddit.
Never look back unless you are planning to go that way

mtwhmemn
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by mtwhmemn » Sun Feb 17, 2019 8:21 am

FIrst of all I'll admit I'm a car nut. That said, I waited until I was in my 50s to go crazy and buy my dream car. You should wait too. Or, lease a luxury car for 2 or 3 years if your mileage is around 10,000 per year and then go buy an Accord or Camry when the lease is finished. The thing about the new Audi is it will become very expensive out of warranty. It'll drive you nuts if you own it because you will be parking it at the far end of parking lots and obsessing over keeping it clean and scratch free. If you lease, you can park buy the shopping carts and rusted out clunkers and when the door dings happen - so what! Be prepared to buy a very expensive set of tires before you turn it in though! They will ding you if you put crappy tires on it. Another thing about Audis, BMWs, Merc's, etc...is they do drive well but there is a trade-off. They are engineered to fail. The systems aren't designed to be repaired, but replaced. Nothing is made to last 10 years anymore. Parts are "thin" for light weight and don't last.Look around for older Audis and BMWs. I don't see them where I live. They are in the junkyards. Cost prohibitive to keep. Go talk to an independent Audi or BMW repair shop and see what the mechanics drive. See what the owner(s) drive. Ask what their wives and kids drive. I'd bet money the wives and kids drive Toyotas and Hondas. Another thing from an engineering standpoint is cars overall are much, much better than they used to be. What I mean is the difference between the way an Accord feels and drives compared to a Audi A4 or whatever the equivalent is isn't nearly that big a difference as it was years ago. The gap is far smaller now. The gap used to huge and that is why an Audi felt so wonderful compared to less expensive cars. Go drive a new Accord or even a Hyundai. It'll blow you mind how good they are.

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TxAg
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by TxAg » Sun Feb 17, 2019 8:26 am

A $50k car at 25 is a bit ridiculous.

sambb
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by sambb » Sun Feb 17, 2019 8:26 am

never had a problem with audi or bmw. Would not buy old model a6. get a preowned macan S. CPO. Done.

BanquetBeer
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by BanquetBeer » Sun Feb 17, 2019 8:38 am

I vote no for a few reasons. While driving in Houston is part of the culture - so are potholes, door dings, and break ins. You don’t have near enough saved. Your income isn’t high enough.

Our strategy was every car is an incremental improvement and each car we get has been more enjoyable than the last. Hard to upgrade from a fully loaded luxury car. Meaning next car will be similar or more expensive.

Over the next 10 years you will probably re-evaluate your goals in life and having money allows you some freedom on how you act on those situations. I’ve known plenty of people with fancy cars and personally never enjoyed the ego that goes with that mentality but it can be very clique-ish. You might be surprised how little the average person cares about cars. They only tend to impress other car people.

Where you are now I was driving a 10 year old beater until I bought a fun to drive $25k otd car (beater was 12 at the time). I suggest you drive your Lexus for another couple years and then upgrade moderately (something preowned in the 25-30k range that you will keep for another 8 years before buying new. (Assuming you want to stay luxury).

Ron
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by Ron » Sun Feb 17, 2019 9:02 am

Just because you can doesn't necessarily mean you should.

- Ron

DrivingFun
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by DrivingFun » Sun Feb 17, 2019 9:17 am

You're going to hear as many opinions as there are people. You know what they say about opinions right :D My personal approach is to try and find a middle ground between long and short term goals. It might sound simplistic but if you read the comments in this thread you'll see that isn't the case for many. When I was fresh out of college, my first job paid 48k/yr I believe. I went out and bought a brand new BMW for 42k OTD. Mind you I still lived with my parents and continued to do so for another 5 years. I was and still am a car guy. That car introduced me to a new world of performance driving events, a hobby and friends I still have over a decade later. I sold that car two years later when I decided to refocus my financial efforts elsewhere. I bought a much older BMW M3, yet continued with my newfound hobby. I drove that M3 into the ground. 2 years ago (already in my mid 30s) I finally sold the (at the time) 20 year old M3 and bought a brand new VW Golf R, no financing, from savings. It wasn't even that I was dying for a new car, it was the fact that I have a family, kid, and I'm driving them around in a coupe with no air bags. So the decade (and change) between selling my first new and expensive BMW, and buying my new and expensive VW, a lot of things changed. I bought a house with a 20% down-payment in a very expensive area with fantastic schools. I got married, I had a kid, I increased my salary 3 times. My net worth skyrocketed. While I didn't spend any money on a new vehicle for a good decade, I spent a good chunk annually to travel with my wife and now family. Europe, beach, etc.

It's a long-winded way of saying a few things. Don't live strictly for now or later (very common on this forum). Do your absolute best to balance the two time frames. Your life and priorities will absolutely change in your 20s and early 30s, always keep that in mind. To expend on that life is not a straight line between two points, especially not early on. Realize that you will make some mistakes, you'll pivot and adjust as needed. No regrets, everything is a learning lesson.

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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by runner540 » Sun Feb 17, 2019 9:21 am

preciseman wrote:
Sun Feb 17, 2019 6:05 am
gclancer wrote:
Sun Feb 17, 2019 5:56 am
Plain and simple, you can afford it. It’ll always be the smartest financial decision to drive a Camry, but for a young kid with his financial house in order and saving 50% of his gross salary? Go ahead and treat yourself to the A6 if you really want it.

Edit: why don’t you wait until you get your bonus rather than selling taxable investments and generating capital gains tax?
Bad year on the trading desk..didn't hit our targets. Bonus is only 40k so I might only see a little over 20 after tax withholdings. So basically not enough money.
I know something about good and bad bonus years, and this is why I would recommend not buying. Since your team had a (relatively) down year:
- you buy a really nice car anyway, they might wonder if you care about the underperformance.
- your boss might think you're totally cool with a $40k bonus if you celebrate with a $50k car, and pay you less in the future.

pennylane
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by pennylane » Sun Feb 17, 2019 9:22 am

Get another Lexus. The Audi will cost you an arm and a leg to maintain and will not be worth nearly as much as a used Lexus.

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Johnsson
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by Johnsson » Sun Feb 17, 2019 9:24 am

Drive your current car for the next 10 years (assuming it continues to run well) while investing the payments, along with your other investing... THEN consider such a purchase. By then you'll likely be glad you kept the car and have the extra savings.
'In theory there is no difference between theory and practice. In practice there is.' Yogi Berra

ERISA Stone
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by ERISA Stone » Sun Feb 17, 2019 9:26 am

Grt2bOutdoors wrote:
Sun Feb 17, 2019 7:37 am
Nothing like spending $250K on a car to send the statement - Look at me, I’m a big spender!! No, it’s not a typo, $50K today could very well be worth $250K in 30-40 years.

I don't mind this mindset in general but do you use it for every purchase? Do you decide not to buy a steak dinner because that $50 could turn into $250 down the road? Just curious where the cut-off is.

investingdad
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by investingdad » Sun Feb 17, 2019 9:32 am

I'll be honest, what jumped out the most was:

- 25m
- buy a 50k car
- saver my entire life
- 25m

The truth is, with that kind of salary at 25, this guy could go hardcore with REAL savings for the balance of his 20s and in a decade be sitting on some actual money.

My advice is do whatever you want as I'm guessing you've already made up your mind.

nicad2000
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by nicad2000 » Sun Feb 17, 2019 9:39 am

I leased a $50k car at your age and never regretted it for a minute. As long as you are saving an appropriate portion of your income, the rest is yours to spend in ways that make you happy. The A6 is a nice car. Just make sure you go for the 3.0T as the 2.0T is underpowered IMHO.

gator15
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by gator15 » Sun Feb 17, 2019 9:41 am

HEDGEFUNDIE wrote:
Sun Feb 17, 2019 7:27 am
I would buy it, but:

1. I would not buy new. You can get a pre owned fully loaded 2018 A6 for $40k OTD. Can go down to the $30s if you don’t need top of the line.

2. I would not buy with cash. Tying up so much money in a depreciating asset makes no sense. Get a 0-2% loan.

A little story for those BHs who are big into depriving themselves unnecessarily. When I was younger I went on regular trips around the world, ate at some of the best restaurants, stayed at some of the fanciest hotels. By age 30 I only had $100k saved in my 401k, but a completely sated appetite for the “good life”. Now that I have a child, I have neither the time nor inclination to do any of those things, nor any wistful regret that I did not live life to its fullest during my single independent years. In the end, if I had saved that money and let it compound, would I have a few hundred thousand more in my retirement accounts by my 60s? Sure. Would I go back and give up those experiences? Not a chance.
I share this outlook. When I was in my 20s I had several expensive sports cars and I have no regret. Sure I would have more money saved now but it’s nice to have gotten the sports car bug out of my system. At this point I have a been there done that attitude and No longer feel the need to get another sports car. It’s also nice to have owned in my 20s because it no longer fits my lifestyle. I say buy the car. You have the rest of your life to save money.

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mmmodem
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by mmmodem » Sun Feb 17, 2019 9:43 am

One of the best things I did in my 20's, was buy an Acura to replace a perfectly working Toyota Corolla. I learned that I hated paying premium for maintenance, repairs, and gas. Sure, I felt good driving a nice vehicle but the additional monthly costs took a literal toll on my wallet. I consider it a cheap lesson to learn and I got "it" out of my system. It was a mistake I had to make in order to know what my priorities were.

When it comes to finances, it's not always about the money but about emotion as well. Make the purchase now when you are young and don't have to answer to anyone. I don't regret my purchase at all, even if it was a mistake.

Thecallofduty
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by Thecallofduty » Sun Feb 17, 2019 9:47 am

OP,

I just want to say you are on the right track at your age with placing money away for retirement; 401k,ira,hsa, and taxable. Many do not learn this so young.

I will not tell you what to do as it is a personal decision and you do have the finanicial Means but I think whatever you decide you will be fine.

Good luck. :D
-thecallofduty

stoptothink
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by stoptothink » Sun Feb 17, 2019 9:58 am

Cycle wrote:
Sun Feb 17, 2019 8:03 am
Houston definitely isn't an ideal place to try and live sustainably, but there are plenty of people that do it there if u check out r/bikecommuting on Reddit.
I did it in Houston for almost 5yrs. I did own a car (truck), but I drove it a handful of times a year when the rain was horrible. My 3-12 miles (one way) commutes were often faster on my bike because traffic was so bad.

OP can "afford" the car, but like most others had said, it would be a pretty bad decision at this point in life. I could "afford" the civic SI I bought for $20k when I was 19, but it was one of the handful of worst financial decisions I've ever made. Glad I had that experience with a $20k car at 19, rather than a $50k car at 25; now, as much of a car nut as I am, I prefer not to even own one.

02nz
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by 02nz » Sun Feb 17, 2019 10:04 am

I agree that you can "afford" the car, but spending that much also isn't very smart.

Why not get an A3 or A4? It doesn't sound like you're hauling kids or people (often, anyway). The A4 is selling for well under $35K according to Truecar. And it's a fresher design (new for model year 2017) than the last-gen A6. Or get a lightly used one and save even more.

Nissanzx1
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by Nissanzx1 » Sun Feb 17, 2019 10:04 am

The Audi is an $8000 car in 5-6 years. Is that really what you want to do with your money? Buy a 5-6 year old Audi for $8000-10,000 and drive it as your nice car for the weekends. Pay cash.

You are doing so well with your savings and investments, don’t screw it up with a high depreciation car purchased with borrowed money.

BanquetBeer
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by BanquetBeer » Sun Feb 17, 2019 10:05 am

ERISA Stone wrote:
Sun Feb 17, 2019 9:26 am
Grt2bOutdoors wrote:
Sun Feb 17, 2019 7:37 am
Nothing like spending $250K on a car to send the statement - Look at me, I’m a big spender!! No, it’s not a typo, $50K today could very well be worth $250K in 30-40 years.

I don't mind this mindset in general but do you use it for every purchase? Do you decide not to buy a steak dinner because that $50 could turn into $250 down the road? Just curious where the cut-off is.
Personally if I can get the steak at the grocery store for $12 then yes, not going to spend the $30+tip to have someone over cook it for me. Typically I’d buy equivalent weight in wayugu for the same price and cook at home for a much better end product.

In my early 20s I spent cumulative 6 months traveling abroad. Did it cheap and I can’t recall what hotels, hostels, or peoples houses I stayed in but I do remember the people and experiences. If you find out what aspect you appreciate you can maximize enjoyment for a lot cheaper. Like cars - do you like luxury or speed? That component can be maximized with something like a WRX or a Lexus vs trying to get the BMW package (lux and speed).

Big item with this purchase is $2000/yr insurance, tires $250/yr, premium gas +20%, and all the other things (car washes, cleaning products, oil changes, etc).

Around 5yr/50k miles in my car have cost $1200 tires, $300 oil change, $3000 insurance. Maybe $5k gas. Total cost of ownership= $34.5-$12(resale) = $22.5k or $4.5k/yr. I’d imagine the Audi will cost about twice that. My cost of ownership will just trend lower (insurance and capital depreciation) and I glide towards the 10-13 year planned length of ownership.

Over the last 5 years stocks have increased 68% (58% inflation adjusted) so the extra $25k (vs a $50k car) has grown to $42k ($39.5k inflation adjusted)

bloom2708
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by bloom2708 » Sun Feb 17, 2019 10:15 am

Don't do things at 25 that will set your 55 year old self back by years.

Bad idea. Even if you had $50k cash set aside in your car fund it would be a bad idea. Sorry to be a meanie. :x
"We are here to provoke thoughtfulness, not agree with you." Unknown Boglehead

cashheavy18
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by cashheavy18 » Sun Feb 17, 2019 10:17 am

https://www.financialsamurai.com/follow ... ar-buying/

A good write up to read before buying an expensive NEW car at your age.

FireSekr
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by FireSekr » Sun Feb 17, 2019 10:32 am

Why not get a Passat. It’s basically the same car it just doesn’t have AWD or leather. Audis are overhyped and not on the same level as Mercedes, BMW, Porsche. They’re based on a front wheel drive architecture and they add in AWD making the car front heavy and poor driving with lots of understeer and little road feel. The engines are poorly designed so when they inevitably have problems, the repairs are extremely expensive because you need to either pull the engine out or remove the front end. Not to mention, the engines are flawed just by nature of being V6 which are less smooth less efficient and heavier than an inline 6. V6 engines are not inherently balanced and need balance shafts to make them run smooth, inline 6 engines are the smoothest engines you can get aside from a v12 which is two inline 6 connected together. BMWs are much easier to repair because most of the repairs can be done without pulling the engine or the front end. Also BMW along with Mercedes uses inline 6 engines while Audi still uses v6

If you’re going to spend 50k which you can afford, get something fun and more appropriate to your age. Check out used BMW M3 or Porsche Caymans. An Audi A6 isn’t fun. It’s just another car with leather and wood and that’s about it. How many times do you have passengers in the back seat that you need that rear seat leg room over something smaller like an a4 which drives better?

Speaking from personal experience. I have a 2017 BMW 5 because I have a back problem and you need to get the BMW 5/Audi A6/Mercedes E to get the better seats that aren’t in the smaller cars. Aside from the 5 being comfortable for my back, I vastly prefer my 21 year old M3 over the 2 year old 5 in every possible way except the seat.
Last edited by FireSekr on Sun Feb 17, 2019 10:48 am, edited 2 times in total.

02nz
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by 02nz » Sun Feb 17, 2019 10:33 am

Leaving aside the personal finance aspects: even a loaded '18 A6 for 50K is a poor value when the equivalent '19 is selling for around 57K. The '18 is an eight-year-old design at this point. I see used '18 A6's with under 10K miles going for $35K in my area.

BuyandHold37
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by BuyandHold37 » Sun Feb 17, 2019 10:34 am

Go for it. You clearly are making sacrifices for your future already, so a little indulgence in moderation, especially at your age, is fine.

JohnFiscal
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by JohnFiscal » Sun Feb 17, 2019 10:36 am

I totally understand the appeal of this Audi. When I was a year out of university (at age 31) I desperately wanted an Audi Coupe GT (this was 1985).

Yes, I could have afforded it. But instead I went with the Volkswagen Scirocco (second gen) instead. More affordable and I was pretty d*mn happy with that car too. Never really had any regrets on not getting the Audi. Later on I did go through two Audis, including a really nice 2000 A4 1.8 Quattro 5 speed ...though driving it on Houston roads/traffic really beat the heck out of that car.

Like another poster, I also wonder if the A6 is the "right" car for you. It's a large sedan. A sedan. I would go for an Audi TT. Or an A3 if they still sell them here. Failing that, I'd look at something sportier...but still consider the Houston driving environment...rough on fancy Euro cars.

02nz
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by 02nz » Sun Feb 17, 2019 10:39 am

ssquared87 wrote:
Sun Feb 17, 2019 10:32 am
Why not get a Passat. It’s basically the same car it just doesn’t have AWD or leather.
This is just not correct. The current U.S.-market Passat is not an Audi with a different badge. The Passat did share a platform with the Audi A4 ... about 15-20 years ago. The current U.S.-market Passat (a pretty crappy car, honestly) is based on the platform of the Golf ... also from around 2005.

CrazyCatLady
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by CrazyCatLady » Sun Feb 17, 2019 10:43 am

I'm with everyone else. You can afford it, so you have to decide if the car is important enough to you that you want to spend (and ultimately lose) that much money on it. If not and there are certain features you like, maybe you can find them in a cheaper car?

My car horror story. In my 20s I wanted a convertible. I was no where near as well off as you financially, but I was determined. I bought a new bright red convertible for $30k and financed it (something crazy like 7% over 66 months). The car was nothing but problems, culminating with a leaky roof causing the interior of my car to flood as soon as it rained (no garage - I lived in an apartment). I'd have to go to the carwash and vacuum out the water. As soon as I made the last payment, I traded it in for a Camry (I wanted a reliable car). I ended up getting $1k trade-in value for the $30k car. Expensive lesson learned. Having said that, I bought my current car (Japanese sedan) new 4 years ago, got the top of the line of my mid-tier model (ie heated leather seats, navigation, bose radio) and love this car and will drive it for at least another 6 years (justifying the $26k price tag in my mind).

FireSekr
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by FireSekr » Sun Feb 17, 2019 10:44 am

02nz wrote:
Sun Feb 17, 2019 10:39 am
ssquared87 wrote:
Sun Feb 17, 2019 10:32 am
Why not get a Passat. It’s basically the same car it just doesn’t have AWD or leather.
This is just not correct. The current U.S.-market Passat is not an Audi with a different badge. The Passat did share a platform with the Audi A4 ... about 15-20 years ago. The current U.S.-market Passat (a pretty crappy car, honestly) is based on the platform of the Golf ... also from around 2005.
I didn’t realized they switched the platform. When I drove the A6 the driving dynamics were bland and some of the switchgear and display graphics looked the same as the Passat. The v6 felt unrefined compared to its competitions inline 6. I came away from the experience having no idea why anyone would buy an Audi over a BMW or Mercedes, but that’s just my experience, I guess some people just like the design or fall for the Quattro marketing

randomguy
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Re: I want a new Audi A6 2018 (50k) - Can I afford it? Or is this just a really dumb decision...

Post by randomguy » Sun Feb 17, 2019 10:54 am

preciseman wrote:
Sun Feb 17, 2019 4:52 am
So..the 2019 audi's are out and are a brand new redesign. There 2018's that are going for a substantial discount from MSRP (15k+) since they are the old designs and dealerships are trying to clear them out.

I currently drive a 10 year old Lexus ES350, about 110k miles on it. No real big problems, just feel like it's about time to upgrade.
Buy a 3 year old A6 for 25k, spend 4k and get some extended warranty to cover you for the next 5 years and have fun. It isn't the smartest money purchase but it might be worth it to you. I will assume the A6 is the car you want (i.e. you don't want the sportier car that everyone will recommend and you prefer a luxury cruiser) for whatever reason.

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