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how to afford R8

64K views 128 replies 39 participants last post by  silentownage001 
#1 · (Edited)
hey

im new here :)

about a year ago decided that i want to get myself an r8 right after uni. i love the car so im prepared to spend a lot on it.

how do you pay for yours? i assume some bought them outright, but i wont have that sort of cash

the best option i can find is so to contract hire one for £1200p/m. this way i get a brand new one every three years!

is there any cheaper ways to get hold of one?

how much do you all pay per month?

steve
 
#4 ·
p/m must mean per month. I paid cash for my car.

An 8% interest rate loan paid over 60 months would cost ~$3102 per month on my car without a down payment (including sales tax and license). That would yield a cost with interest of ~$186,200USD. Another way to look at the payment is you would need to earn ~$4772 before taxes to make this payment with a 35% tax rate. (I sure hope my old HP19B Business calculator gave me the correct answers. If not I apologize. It has been many moons since I used it last)
 
#5 · (Edited)
i decided that an r8 is what im going to spend a massive bulk of my money on when i come out of uni about a year ago.
I don't know how much cash you will make upon graduation, but if I was you I would strongly reconsider doing this. It is hard enough getting ahead financially when you are starting out, without tying up a large portion of your earning power in a car - a rapidly depreciating asset. I don't think that extravagances like high end sports cars and associated interest costs should be allowed to dominant someones finances or net worth. Clearly this is just an personal opinion, but lots of people put a major hurt on themselves by living beyond their means.
 
#6 ·
I'm going to throw in my $0.02CAD and agree with kthacher. If you want to drop a roll of money on anything or get in debt, real estate is the best place to start right out of school. Not only is a roof over your head a decent long term investment (compared to a car), but its an expense you will always have; why pay rent when you can pay towards your own equity?

The other thing to keep in mind, depending on what field you work in, owning an R8 at a fairly young age can send the wrong impression to clients. In the finance sector that I work in, rightly or wrongly, clients will sometimes decide to choose an adviser for their funds based on their 'spidey-sense'. Young guy in a 3 series BMW=good (he must be successful to have a nice car), anything super-fancy=bad (who's portfolio did he Madoff to afford that car?)
 
#8 ·
I agree with the others comments. I had a company car for 30 years. No car expense at all. I received a new car every 3-4 years. No worries or costs. I purchased my first house at 20 years of age. The only time I rented was when a house was being built. Think about it.
 
#9 · (Edited)
I was going to reply with some reasoned but gentle points but realised that there is no reasoned or gentle way to tell someone still at Uni that unless they have a very rich and kindly father then a dream to immediately buy an R8 is just that - a dream.
If you really did arrange to somehow finance one then the dream would soon turn into a nightmare :(
 
#11 · (Edited)
Maybe you are concerned about appearances and fast visual impressions. For a young ambitious professional, I suggest investing more into a healthclub membership that you will actually use regularly, a better wardrobe, a good city-capable bicycle, and maybe a nice motorcycle. Being fit, well dressed, and looking environmentally aware, are essential basic tools that will help sell you as an up and coming, hard working, intelligent, achiever. This is the path to opening more doors for yourself. Of course, once inside the door, its up to you to deliver the goods. Personally, I would never want anything to do with a young professional who caters to a very serious love of luxuries.
 
#12 ·
hey

i decided that an r8 is what im going to spend a massive bulk of my money on when i come out of uni about a year ago.
I'm not sure whether you are coming or going as present and past tenses are mixed in the same sentence, but I have to agree with others.

Make sure you have enough cash to pay for the car to cover the depreciation in its value and other emergencies, in case you need to sell the car. If you don't have that kind of cash, then wait til you do. I can assure you it is worth it on all fronts. There is no point in driving the car with your backside squirming about whether you can meet the next monthly payment.
 
#13 ·
These are all very good advise. It is good to have goal and dream. You have plenty of time to drive and enjoy what ever car you want down the road. If you are making a pile of money now and have no problem afford one, go for it. Take my situation as example, I did not predict my business is heading south this fast, now I wish I do not have this car payment.
 
#16 · (Edited)
thanks for the replies

when i finish uni i am guaranteed a job of roughly £36k a year with the family business, although this is arguably no where near enough to support a £1.2k monthly payment for the car, there are a number of things that change the situation.

the contract hire i mentioned means that i will not have to worry about the depreciation, or upkeep. oil changes, new tyres and things like that are included in the cost, this is a maintained hire. also, when my 3 year contract ends, they take the car back, this means i dont have to worry about re-selling it for a good price as i know what it was going to cost me when i enter. there is no hidden suprises.

the way i see it, the worst case scenario would be that i really wish id have put the money towards a house or another investment. the family business i mentioned is fairly recession proof so the job is safe too. i would only set myself back a few years, but in the mean time look what i DO have. i have the car of my dreams, and when the 3 years is up, if i dont wish to take out another 3 year contract, i dont have to.

having said this, your comments have made me think about it a lot more. the fact that that huge amount of money over 3 years could easily have bought me a number of more useful assets.

let me know if the situation changes your minds, ill think about what youve all said too =)
 
#18 ·
the way i see it, the worst case scenario would be that i really wish id have put the money towards a house or another investment. the family business i mentioned is fairly recession proof so the job is safe too. i would only set myself back a few years, but in the mean time look what i DO have. i have the car of my dreams, and when the 3 years is up, if i dont wish to take out another 3 year contract, i dont have to.
Listen, I know you're young and pretty stuck on doing this, but keep in mind that the situation you presented above is pretty much why we're in this "recession" to begin with.

Doing this will mean you are living just at or past your means... all it would take is one little incident to throw off the precarious balance you've got worked out there and you're screwed. For what? To show that you had an R8?
 
#17 ·
I want to guess “the contract hire” = lease? I am not familiar with what is outside of the US, if you lease the car here, you still need to pay to maintain the car, and keep it in the best possible shape for the term of the lease. I personally think it is best to purchase this car. I calculated the least payment for 3 years, it was just way too much money down the toilet(even with tax benefits).

If I understand your number correctly, you have a gig that pay $36K/yr. And you want to get into a car that cost about $14K/yr to least? I really advise you to rethink this. My 2 cents.
 
#19 ·
Hmmmm. Roughly speaking you're talking about investing around half of what you will take home after income tax in a car on contract hire (ie an asset you will not own and that you are in any case guaranteed to make no return on). I assume you don't already own your own home or have any other significant investments? Are you planning on living at home or do you have to buy/ rent? Have you had an insurance quote? Don't forget the car tax (assuming that isn't included).

When I left university I also wanted my dream car (trust me, I had all the same thoughts you're having) but I convinced myself to do the sensible thing and invest in buying a flat instead. It was a struggle to start with, but over the 20 years since I've managed to own most of the cars I've dreamed of (generally the limitation had been practicality - see points above on what car is acceptable to turn up at a client driving!) and I now own a new R8 as a second car (I would still never take it to a client and I'm careful who knows what I drive). I also own a boat, a fully equipped recording studio and most other 'toys' I've wanted.

The company I work for hires graduates on a little more than your starting salary. Some of them are petrolheads but if I look in the car park I see them driving second hand M3s or 911s, Z4s, TTs, Elises, etc at best. Most are still struggling to get on the property ladder as a first priority and the majority are driving much less expensive cars (insurance is a major barrier).

My advice is to think carefully before you invest such a significant proportion of your income in a car. £36k may seem like a lot of £s but you will find that cash rapidly disappears once you leave uni. I probably sound very boring ;-) but you really don't want to end up tied into a 3 year contract hire scheme that prevents you from investing in your future and actually enjoying life (it sounds cliched, but having a great car will not make you happy unless you're already happy!).
 
#20 ·
Thanks for the amazing response Beautiful Freak! It sounds like you really understand how it feels to want the car but not be in the right position to get it!

I am thinking about it all very carefully; i'm not running to the Audi dealer and putting my name on the list straight away. Otherwise I wouldnt have posted here.

I just asked if anyone knew a cheaper way to get one? Paying it off over a longer period of time maybe?

I think I will get a mortgage under my belt first and then get the car, as painful as that sounds right now!

Thanks for ALL responses so far though, it just seems very easy to tell someone to wait for the car when you all have one sitting in your garage.
 
#22 ·
What is your job? If you dont mind me asking?

You registered just to reply to this?! Do you use the forum anyway or did you stumble on this thread?

I suppose my motivation would be greater if I was working towards the car rather than along side it, thats a very good point. But at the same time, if my finances do work out strong enough or my situation improves so it is more realistic to afford the payments, why shouldn't I go ahead? I could get hit by a bus tomorrow and never be able to drive again.
 
#30 · (Edited)
What is your job? If you dont mind me asking?

You registered just to reply to this?! Do you use the forum anyway or did you stumble on this thread?
internet business. And yes I have been lurking on these forums, I registered today because I saw your thread, it just seems tragic to lose all that money on something like an R8. However, as everyone says it is your money. I'm sure you'll get a lot of fun out of it, but as aways there is a price to pay.

Would you rather enjoy having the R8 for a few years "now" or have an R8, plus other exotic cars for life, say 10 years down the track when you're comfortable, and let me say 10 years flys pretty fast, the older you get. :D
 
#23 ·
I think things are very different in the U.K. You have a better opportunity in finding the R 8 of your dreams over there.Most of us have climbed up the ladder of better and better cars. Starting at the bottom. Follow your gut feelings. You must ask yourself,can I do this? and if you answer : " Hell yes, I can"- then just do it!!!!:rolleyes:
 
#25 ·
At the end of the day, it is your $, your life, your decision. But since you asked, we all put in our 2 cents ; D. I read some really good responses here for you, young man. I wish I have access to this kind of information when I was your age, and this fast. I wish you good luck.
 
#28 · (Edited)
I've been a car nut since about age 14, and can clearly remember the similar plans I had for when I got out of school. In high school I read a story of a refrigerator repair man that squirreled enough money away to buy a Lambo - while living in a trailer home. That made pretty good sense to me then, and was my plan through college. Why waste perfectly good car money on a house?

Fortunately I was in school a long time. Long enough to come to a little more sensible financial plan. Only a little though. There is no avoiding the fact that expensive cars are a terrible place to put money if you are still budgeting for stuff like retirement, a home, kids college, etc.

You could do what I did, and save enough to buy the car and refinance the house for a little extra to be sure I am not short. You could lease. You could buy with a loan. In all cases you will pay the depreciation, and in all cases you will lose the potential investment returns. I know. I didn't really care about retirement in my 20s either. Just remember the difference between blowing money and investing it now will be massive by the time you are even middle aged.

It is easier to see what your budget really is once you start working. Take your time. I had several friends who had financial trouble on a salary like yours who had fairly modest cars and apartments. Money has a way of vanishing, especially when you are young.

On the other hand, most people here have probably come to accept that life is not just about retirement and a bulletproof financial plan. We have to live along the way, which often requires doing dumb things with our money. Here is my car msrp/annual salary scale which may help you ballpark your car budget. It applies to anyone who has not yet completely paid for life's necessities. It is obviously effected by age, salary, savings, etc. I hope it helps.

<25% - hardly dumb at all (AKA prudent)
25 - 50% - kinda dumb (AKA prudent car nut)
50 - 100% - stupid (car nut can still easily justify this range. May be worthwhile for "perfect" car)
>100% - colossally dumb (high risk of regret)
 
#29 ·
A car is merely there for personal enjoyment, but it's temporary. Look into putting more money away or making more of it so that you can comfortably enjoy such toys in the future. Focus on the road to your dream.
 
#33 ·
Here is my solution, I know I can’t possibly own/drive all my dream cars. I started to collect diecast models, and I love them. There are some fairly high end(quality, details) diecast out there. There are aso a tons of junk diecast. You can get them in 1/18 scale, 1/12 scale. It is not an inexpensive hobby, but it is one way for me to own all my dream, from vintage racers to modern exotic. I am not suggesting you to replace your 1:1 scale R8 with a 1/18, but...
 
#35 ·
If you were hit by a bus...Riding shotgun is nice too ! There is a bright side to everything,It's just very hard to see sometimes.If you don't purchase now,imagine what Bitch'en car might be available to you later. Just don't be a repeat offender..Don't make the same mistake more than ONCE. Always have a plan "B",and a "C",even a plan "Z"!!Eventually the dream stops and reality kicks in. It takes a bit of time and work to make dreams happen --sometimes...But it will be worth it.Patience buddy,It sounds like it will happen for you.Keep the mistakes to a minimum cuz its' mistakes that slow things down.Not to say all mistakes are bad.If something comes out wrong because of a mistake,often the finished work comes out even better after work is redone!!! Enough of my jibber! Think Positive!!!:)
 
#36 ·
I understand where you (the original poster) are coming from, but the fact is the R8 is probably a little too beyond your means at the moment, although it is all about disposable income rather than headline salary. There are loads of great cars that are much cheaper, so you do not need to start with the R8. You could also wait a couple of years until they really are a lot more affordable. In your case do not buy new. When I was in your situation I dreamed of buying a Lotus Esprit - never could manage it though but now I have my name down for the replacement model. Have fun but my advice is do not spend all your money on a car.
 
#37 ·
Hey, first time poster, but I have kinda the same situation as the original poster. About to graduate in Dec 2009, but my yearly salary will be about $150,000-$200,000. But those are safe numbers. It has the potential to be a bit more.

So from some smart people's advice, does it make sense to buy an R8 about this time next year?

PS-Can some of you share what you pay monthly for your car payment/lease? That would be great. Also, some insurance info would be awesome.
 
#39 ·
loan you are looking at about $3k/month (depending on final price, downpayment, amortization, rate etc etc)

What line of work are you going into? At the risk of rehashing previous posts in this thread, remember that if you are fairly new into a particular field, buying a car such as an R8 may colour the impression your new boss has of you.

Like mngolfer, my insurance is in the $1400 range/year, but that factors in that the car is a weekend vehicle for me and I have >20 yrs driving with no tickets or at-fault accidents.
 
#40 ·
Just found this thread, and wonder why anyone would take out a loan for a car like an R8. I kind of assumed that at this price, it was pretty much a cash pay situation.

Given that the price of an R8 here in the States is about on par with a home, it just doesn't make sense to buy one right out of university, regardless of your income. Buy a home, save like crazy (anyone want to repeat the past couple years' portfolio performance?), and get a great but less expensive car.

Of course, when I was young, I always thought the cool cars were wasted on the old guys driving them. Now that I am the old guy driving one, I realize that they're never wasted on anyone -- they're just expensive.
 
#41 ·
Just turned 21 the other day, 13 as deposit, rest on finance with baloon. 980 for brand new car + high spec :)

PS what UNI are you at? Its good to know another member my sort of age:)

Thanks
 
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