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

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Atilla
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Joined: Tue Feb 09, 2010 7:44 pm

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

Post by Atilla »

Drive the Lexus until it has 180,000 miles on it, then buy an Audi.
dbr
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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 dbr »

randomguy wrote: 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.
I agree. An older Audi, CPO deal or whatever, is the formula for cutting the dollar drain and still having a car you like. Of course older German brand cars are notorious for high maintenance which is not just a cost but a major nuisance. Fascination with some particular make and model also seems strange given so many different kinds of cars out there.
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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 »

Johnsson wrote: 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.
This is my favorite response among all of this thread. Nothing will cure car fever more than being told to carve out another decade of driving what you already have.

🤷‍♂️
NotWhoYouThink
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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 NotWhoYouThink »

Get rid of the Lexus, you are way too young for it. I am 60 and am way too young for a Lexus. The parking garage at my mother's retirement community is filled with Lexi, you can buy one when you are old.

Enjoy the Audi. Buy it new so you have plenty of time for it to be under warranty, because a German car is going to need a lot of maintenance. If you really love the feel of driving it buy the Audi (NOT 3rd party) extended warranty package when your factory warranty ends, because maintenance.

My husband drives BMW because he really appreciates the handling, and is willing to grit his teeth about the maintenance.

My car is a Mazda3 because it's fun to drive and after 4 years and 50K miles has never needed unscheduled maintenance. EVER.

Looks like your career may be one where signaling your success is somewhat important. If so, the Audi isn't a bad choice. But watch out. If you buy the Audi, eat all your meals out, spend a ton of money on clothes, and otherwise fritter away your earnings you'll be sorry when you are old enough to buy that Lexus.
stimulacra
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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 stimulacra »

Maybe target 10% of your net worth… 

Also, why not get an off-lease version that's 2-3 years older? Same body style, a good bit of warranty left.
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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 »

This is my favorite response among all of this thread. Nothing will cure car fever more than being told to carve out another decade of driving what you already have.
🤷‍♂️
Thank you. That's kinda my point. The OP, who is posting on an investing board, needs to get practical and live like an (Boglehead) investor.

Maybe in 10 years he can afford the nice car without a big hit to the future value of his/her investments. Not there yet, IMHO...
'In theory there is no difference between theory and practice. In practice there is.' Yogi Berra
keith6014
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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 keith6014 »

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.

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!
what do you do for a living? Texas, bonus, trading sounds like a highly cyclical business.
I would keep the Lexus. If you want to buy a new car buy a Toyota Corolla hatchback OR if you want something spicy a Subaru WRX.

Audis are unbelievably expensive to maintain.
MiddleOfTheRoad
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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 MiddleOfTheRoad »

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.
+1. Buy it. Try not to cash out taxable.
quantAndHold
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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 quantAndHold »

I bought a new Audi in my 30’s. It was amazing. I loved it. For about 6 months. Then it was just another car, except with more mechanical problems than the Japanese car I sold. I sold it when the factory warranty ran out and bought a Mazda3, which I still have and have been much happier with.

In your situation, I personally wouldn’t buy a car that I couldn’t cash flow. If the bonus isn’t high enough to pay for this, either get something cheaper or wait for a better bonus year. Also, an Audi A6 is an old people car. Are you sure you don’t want something more age appropriate?
Yes, I’m really that pedantic.
BoggledHead2
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Joined: Tue Jun 12, 2018 6:50 pm

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

Post by BoggledHead2 »

Can you afford it? Yes.

Will you regret it? Probably, because 50K is a lot of money to spend on a car. I’ve had the luxury German car before ... it’s exciting for a week and then I realized how much money I wasted on something I don’t actually “need”

But, life’s short. If this car will make you happy - and you can continue saving/investing at a high rate - go for it.

* i would never sell investments for a car unless it was absolutely necessary (a 50k car is not absolutely necessary)
Annabel Lee
Posts: 75
Joined: Sat Nov 24, 2018 9:18 pm

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

Post by Annabel Lee »

Sounds like you are sold and have your mind set on the A6. I would actually consider leasing as an option in this case.

Solves the "tying your money up in a depreciating asset" issue, you can sell the ES to fund any down payment on the lease/buy down the monthly cost, and at the end of the term, you buy the A6 if you're still in love with it.

Plus Audis are notorious for maintenance/service issues...

Plus you have the leftover cash flow to cover the payment.

Not the worst idea here...
MindTheGAAP
Posts: 305
Joined: Fri Jan 31, 2014 12:44 am

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

Post by MindTheGAAP »

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.

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!
What are they offering an A4 at discount-wise for a 2018? If you’re a single 25-yr old then do you really need the added size of an A6 with add’l running costs etc?

I say this as a 30-yr old who’s married with 3 kids so different life stage to where you’re at, for sure. Also in TX (Dallas) so aware of the workplace pressures if you’re on a trading desk to have a nice vehicle.
"One of the funny things about the stock market is that every time one person buys, another sells, and both think they are astute" - William Feather
dbr
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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 dbr »

My question is what is the attraction of an Audi A6? It is just another car.

There are some interesting cars out there, but I doubt that is one. My neighbor bought a vintage Corvette and I thought that was pretty cool.

The operative response on this thread is advice to rest on it for awhile and see if the desire is still there after a few months or a year.
DesertDiva
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Location: In the desert

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

Post by DesertDiva »

Suggestion: read “Stop Acting Rich and Start Living Like a Real Millionaire” by Thomas Stanley. Then make your decision.
MindTheGAAP
Posts: 305
Joined: Fri Jan 31, 2014 12:44 am

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

Post by MindTheGAAP »

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.

People should read this twice. I think you have to assess the season of life you’re in and where you believe it may be going. 30-yr old father of three daughters and so I fully understand your current mindset. I see too many people going to crazy extremes at either end of the spectrum - a balance is most likely to get you to where you want - even if it’s a balance on the conservative side of the scale!
"One of the funny things about the stock market is that every time one person buys, another sells, and both think they are astute" - William Feather
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Socrates
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I will buy your Lexus

Post by Socrates »

I currently drive a 10 year old Lexus ES350, about 110k miles on it.
:sharebeer
“Don't waste your time looking back. You're not going that way.” ― Ragnar Lothbrok.
letsgobobby
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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 letsgobobby »

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Last edited by letsgobobby on Thu Apr 18, 2019 1:18 am, edited 1 time in total.
TrustButVerifying
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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 TrustButVerifying »

You have plenty of opinions so I will not comment on your original question but I did want to point out something you should consider. One of features that I really like and impresses people is Audi Navigation's Google Earth Map display feature. Google is changing Google Earth in 2020 and when that happens, Google Earth will no longer work with the 2018 and older Audi MMI systems. (They will still display the standard 2D maps.)

I have the A6 and absolutely love the car. I have had zero reliability issues and I think the talk about Audi reliability problems are based upon old information.
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StormShadow
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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 StormShadow »

My advice would be to pass overall. A little early to splurge on a luxury car and Audi’s depreciate like crazy.

That said, if you really like the car I’d wait a year and buy it used.
finite_difference
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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 finite_difference »

runner540 wrote: 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.
+1. Think about the psychology.

If you do buy it, I’d wait 6 months so it looks like not tied to your bonus. Otherwise, better to do it right after a large bonus off a great year.
The most precious gift we can offer anyone is our attention. - Thich Nhat Hanh
bradpevans
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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 bradpevans »

preciseman wrote: 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!
I bought my A6 as a 3 year lease turn in

I paid about 60-62% if the original price

As a certified pre owned, I got six year / 100,000 warranty (I bought at 3/36000)

Didn’t get the newest improvements but money went a lot farther
H-Town
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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 H-Town »

preciseman wrote: Sun Feb 17, 2019 4:52 am

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!
Sure you can afford it by having the funds ready in taxable account. And yes, it's a dumb decision financially - if you don't "replace" 50k with other spending buckets so that you're still on track towards your financial goal. Are you willing to sacrifice vacation spending for the next 5 years to fund the car? Are you able to make an additional 50k after-tax income to catch up your savings?

Not that it's wrong to make a dumb decision financially. You live and learn. People who are successful financially make the right decisions on big ticket items such as house, cars, vacation, marriage, kids, etc. I think you already did it right with your house (200k?) and also not much spending in traveling. Do you have a conviction that you're making the right decision with this new Audi?
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aspirit
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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 aspirit »

Most people drive an expensive car to impress. I saw a mybach, and a NEW rolls convertible at a establishment I frequent both the same day. Both out of the ordinary. I’d not want the repair bills. No you should not be dumb, as you say. :P
Time & tides wait for no one. A man has to know his limitations. | "Give me control of a nation's money and I care not who makes it's laws" | — Mayer Amschel Bauer Rothschild ~
Topic Author
preciseman
Posts: 130
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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 »

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.

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?
Dang..once you put it that way..guess I really don't need it lol...
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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 »

pennylane wrote: 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.
The 2019 ES350 does look damn sexy.

But it actually cost more for a comparably equipped A6! Guess it really will be maintenance as the differentiator, but then again I've never driven a german car so all I have to go on are the horror stories lol.

Never had to do anything on ES350 except replace CV boot/consumption items (tires, brakes, oil, coolant, etc)
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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 »

02nz wrote: 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.
The comparable 19's are actually 70k+..I'm looking at a premium plus 3.0 not the normal base 2.0 model. This one has a supercharged v6 AWD :D
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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 »

randomguy wrote: 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.
I might just take this up. Sucks the selection for the trim that I'm looking for under 30k miles doesn't exist RIGHT now, but will have to wait a few years.

And yes, I hate traffic. What good is a sports car if I can't get it over 30 mph anyways?
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preciseman
Posts: 130
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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 »

keith6014 wrote: Sun Feb 17, 2019 11:28 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.

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!
what do you do for a living? Texas, bonus, trading sounds like a highly cyclical business.
I would keep the Lexus. If you want to buy a new car buy a Toyota Corolla hatchback OR if you want something spicy a Subaru WRX.

Audis are unbelievably expensive to maintain.
I trade power (electricity) at a supermajor
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 »

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!
keith6014
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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 keith6014 »

preciseman wrote: Sun Feb 17, 2019 1:09 pm 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!
i will make it easy for you. don't do it wo(man).
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sawdust60
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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 sawdust60 »

NotWhoYouThink wrote: Sun Feb 17, 2019 11:15 am ...

My car is a Mazda3 because it's fun to drive and after 4 years and 50K miles has never needed unscheduled maintenance. EVER.
...
+1 on checking out Mazda3

I got a new 2018 Touring edition under 19k before TTL. At that price, I figured it could be an extended test drive if I decided I wanted something different.

But I found that I really like the car. The size is just right. Legroom may be a problem for tall folks or in rear seat.

Also check out Miata Club, hard top convertible.

Or if you need to spend 35k+, get a Jeep Wrangler. It will have lower depreciation than most other vehicles.

A friend once explained why he drove a Honda Accord, instead of a more expensive car: He trades the Accord for a new one every two years. Always under warranty; never buys tires. With an expensive car, he would need to drive it 10 years, and the 10-year cost would likely be more.

+1 on the Accord if you need legroom. I also like the various Civic models. Type-R is not cheap.
Starfish
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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 Starfish »

preciseman wrote: Sun Feb 17, 2019 12:56 pm
pennylane wrote: 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.
The 2019 ES350 does look damn sexy.

But it actually cost more for a comparably equipped A6! Guess it really will be maintenance as the differentiator, but then again I've never driven a german car so all I have to go on are the horror stories lol.

Never had to do anything on ES350 except replace CV boot/consumption items (tires, brakes, oil, coolant, etc)
Outside this forum You are pretty much the only person (let alone 25y old) who thinks a Camry with leather is sexy. You might be a true Boglehead !
bling
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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 bling »

no one should buy an audi without first considering the golf R.
capsaicinguy
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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 capsaicinguy »

Don't buy the car. You're basically talking about taking a quarter of your retirement savings and buying a depreciating commodity. One of my few financial regrets is wasting as much money as I did in cars in my 20s. They were fun, but I sure wish I had that money now that was flushed down the drain, to the tune of 10s of thousands of dollars. Learn to be grateful for and content with what you have. Once the shine has worn off and you look back at that empty taxable account AND the fact you had to pay extra taxes on the money to pull it out in a year or two you will probably regret it. You're doing great for being in your mid 20s, don't disrupt that momentum now by engaging in some massive lifestyle creep. If you had 10x as much in all your accounts I'd say go for it, but right now your focus needs to be on saving not spending. Just my .02.
NotWhoYouThink
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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 NotWhoYouThink »

Is 0% or low rate dealer financing available? You might be able to finance it at a reasonable rate, say under 2%. Then you could keep your money invested and have a place for your monthly excess spending to go.

But if you think a Lexus ES350 or whatever is sexy, you may not be an Audi driver. You have to love the German handling to tolerate the maintenance nuisance.
caffeperfavore
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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 caffeperfavore »

You're 25 and you want a big A6? Get an A4, or better yet, the S3 which is now the fun Audi. I think of the A6 is an older person's car. Your income and assets aren't there yet.

There's so many good options for $40k or less when you consider gently used options that I wouldn't consider a new A6 and I'm an Audi fan and former owner.

But then, after going through my car phase as a younger person, I realized that cars aren't what make me happy. I now drive a Toyota, which I love because I don't care what happens to it, which is liberating. Fancy cars tend to own you rather than the other way around. Give me something I can throw some muddy bikes on top or gear in the back rather than something I'll be need to detail every other week and get upset over door dings.
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White Coat Investor
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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 White Coat Investor »

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.

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!
I think this is a bad idea. Too high of a percentage of income and net worth. It will significantly slow your accumulation of financial security.
1) Invest you must 2) Time is your friend 3) Impulse is your enemy | 4) Basic arithmetic works 5) Stick to simplicity 6) Stay the course
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 »

Starfish wrote: Sun Feb 17, 2019 1:31 pm
preciseman wrote: Sun Feb 17, 2019 12:56 pm
pennylane wrote: 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.
The 2019 ES350 does look damn sexy.

But it actually cost more for a comparably equipped A6! Guess it really will be maintenance as the differentiator, but then again I've never driven a german car so all I have to go on are the horror stories lol.

Never had to do anything on ES350 except replace CV boot/consumption items (tires, brakes, oil, coolant, etc)
Outside this forum You are pretty much the only person (let alone 25y old) who thinks a Camry with leather is sexy. You might be a true Boglehead !
+1
bluebolt
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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 bluebolt »

I'm more than twice your age. Until last year, I only had ever bought used cars and driven them for 8-10 years.

Last year I bought a new Audi as my first new car purchase ever. I love the car, but at about 1% of my net worth, it was easy enough to afford/justify.

If you were my 23 year old self and I were giving him advice, I would recommend getting a used Audi for half the price (or less).
Jags4186
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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 Jags4186 »

That’s what the money is for. My only recommendation is to not get an A6. Kind of a lame car for a 20something. A5 Sportback is much better looking.
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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 »

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.
No, but it’s all about weighing opportunity cost vs. immediate gratification. $50,000 could buy me a cheap steak dinner 1,000 times. $50,000 could be a good “grub stake” for a future opportunity. $50,000 could be a great emergency fund for an unemployed trader. When I posted earlier, I wasn’t aware of OP’s occupation, now that I am, I’m even more convinced that spending $50k on a car is a poor idea. Trading is a feast/famine business, a lot of those jobs are being automated. Saving it is better than spending it especially since OP said they had a “bad” year in 2018. Waiting 1 Year will not hurt especially if the year stays or continues the way it’s currently going, OP will get a much bigger bonus next year, he’ll have the money and the ability to act on future opportunities.

My cut-off is based on need and quality of item. I don’t buy because I have some money in the bank. If I need it and can afford it, I will buy it. The cutoff is, I will not buy it if it drains nearly all of my readily available assets to buy it. Buying this car, will leave OP without the safety net.
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions
KyleAAA
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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 KyleAAA »

Yeah you can easily afford it.
Figuring_it_out
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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 Figuring_it_out »

You are going to be AUDI a lot more money to maintain it properly. You're moving from essentially a Toyota to a high end car with lots of proprietary equipment. Typical maintenance things like oil changes, filter change, belts, brakes, even tires will be eye opening expensive.

If its not the car of your dreams AND you have driven a few and this will be a car you will love for at least 5-10 years (Id say closer to 10) then dont get it. If you've been drooling over the A6 since that body style came out and the test drives gave you the tingles. go for it.

You should have the income to cover it and you only live once. The fact that you are asking and have your finances organized enough to post here tell me that you are a well grounded person. Even a 30K mistake (50k new and sell for 20K if you realize there are downsides and want out in a few years)
is recoverable and a useful tool for future decisions.
Bruce T
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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 Bruce T »

I won't comment on whether you should buy it, but if you do, here is some input from an owner of the same generation ('16 (C7) A6 3.0 TFSI, 25K miles):
1. it is a biggish car - bought it vs A4 because my kids are pushing 6'5" and need leg room.
2. the 3.0 TFSI is powerful ... I don't drive too aggressively but I expect have almost never pushed it beyond 25% ... IMHO that much power/accel is really only needed on a track or someone really interested in "burning rubber" (which you can forget about w/ the quattro and traction control)... it is fun to drive and handles very well.
3. If you pull the trigger, I recommend going CPO ... I got a ~30% discount on a unit w/ 9 months and 6K miles on it plus got the added warranty... it had been a dealer loaner (I think they need to move loaners prior to the end of the calendar year of their model year, or at least that's the line they gave me).
4. highway MPG runs around 34-36, pretty good for a car that size ... but it wants premium, so a fair amount of economy is lost on that account.
5. build quality is excellent and reliability has been good so far, but it is young. There have been a couple recall/TSB items, nothing major.
6. while I think the design is nice, it's also fairly understated
7. older model (C6) and 2.0s have higher than average reported issues w/ intake carbon build up ... have not heard that's a major issue on C7, but might be something to inspect for, particularly if you end up w/ an older model or higher mileage unit.

... if I were your age and thought I could afford it, I would look at the A4 (or S4, if into track/high end performance)... unless there was a compelling business case (ferrying client's around, etc.). At your age I was more into saving and drove family hand-me downs or low-end Mazdas... like previous posters, I waited for a dream car for my mid-50s and when the spend was a very small portion of my total assets... additionally, my employer's very nice car allowance and expectations that it be spent on something that was comfortable for clients satisfied the BH in me on the value front (I highly recommend that approach to car financing!)

Best of luck ... enjoy it if you do it ... but do carefully weigh whether it's really important to you!

PS - am happy to answer model specific questions via PM... but also check out the very good audiworld.com (and other similar) forums for lots of great owner experiences and Q&A.
mortfree
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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 mortfree »

Why buy one car for 50k when you could easily own two vehicles.

Something like a weekend car or do the car plus SUV or car plus truck or convertible.

It is just a phase that I went through as well. I am now 42. I chose the 2 vehicle route at 23 and still keep two for myself.

Friday night I was searching online for a corvette since that is my “dream” car. But I am able to think about the newness wearing off. The fear of someone ruining it. The monthly payments. When would I actually be able to drive it. Etc.

And the best was my 5-year old asking where the three of us would sit in the corvette.
ladycat
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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 ladycat »

preciseman wrote: Sun Feb 17, 2019 4:52 am
*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.
I think you answered your own question. Sounds like this is a new shiny that's caught your eye, and you can get a discount. I suspect you'd enjoy it for 6 months, then wonder why you didn't wait to get The Car you really want. Sleep on it for a couple weeks and the temptation might not be so compelling. In the meantime, maybe getting your Lexus professionally detailed will give it new spark for you.

When DH test drove Audi (A5) a few years back, as a passenger, it was not enjoyable. I don't enjoy being a passenger in his "ultimate driving machine" either, especially on long drives. German autos are fun to drive, but I find the passenger compartment unpleasant. So if you plan on having frequent passengers, I recommend bringing someone along to see how they like it.
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StormShadow
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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 StormShadow »

preciseman wrote: Sun Feb 17, 2019 1:09 pm 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.
No offense, but the A6 and E350 strike me as kind of an older person's car. Older than for a 25 yr old, anyhow.

I recently was looking at Audi, but was considering an RS3. Went with an M2 instead. But I was looking for a smaller sportier vehicle.
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 »

TrustButVerifying wrote: Sun Feb 17, 2019 11:56 am
I have the A6 and absolutely love the car. I have had zero reliability issues and I think the talk about Audi reliability problems are based upon old information.
Audi has been at the upper end of most reliability surveys for 5+ years now. They routinely end up in front of honda and acura for example but the gaps between #5 and number #15 in brand reliability tends to be pretty small.

The couple gotchas
a) we tend to be talking <10 years/100k miles in pretty much all of these surveys. How that applies to reliability as the car ages is a different issue
b) maintenance is more money
c) the repairs you have are more expensive. That 400 dollar broken engine sensor on a honda turns into a 2k dollar broken engine sensor on most german cars:)
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 »

StormShadow wrote: Sun Feb 17, 2019 6:54 pm
preciseman wrote: Sun Feb 17, 2019 1:09 pm 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.
No offense, but the A6 and E350 strike me as kind of an older person's car. Older than for a 25 yr old, anyhow.

I recently was looking at Audi, but was considering an RS3. Went with an M2 instead. But I was looking for a smaller sportier vehicle.
The luxury midsized sedan market tends to be the 45+ year old market. Things like an RS3 are totally different cars that you don't cross shop with those. The A6 is a much better road trip car.The RS3 is a much better track car. Match your needs to the car.

And the A6 is about as far from an ES350 as a A6 is from an RS350. The ES is the ultimate I don't care about driving experience just get me there mode of transportation. Think Buicks for boomers:)
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 »

mortfree wrote: Sun Feb 17, 2019 4:00 pm Why buy one car for 50k when you could easily own two vehicles.

Something like a weekend car or do the car plus SUV or car plus truck or convertible.
1 nice thing is better than 2 shitty things:) Well sometimes. Read all the simplify your life threads that are a current fad going around right now. 2 cars work well when you have different vastly different needs and you use both enough to make owning work out. That is something you need to figure out.
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