Can I afford this car?

rockyraccoon89

This is my situation: I am 23 years old, on an "ok" salary of £30k and I am living with my parents.

My monthly expenses are around £500 and I tend to save around £1200 per month. I have got £20,000 in the bank/investments etc. No debt.

I would like to buy a used BMW Z4 that will cost around £15,000 on a 4 year loan.

Do you think I am in a good enough financial position to go for such a large loan or should I wait till I'm older? Also would it be more sensible to just keep saving for a property? (Not sure I'll get a huge mortgage on my current salary anyway)

Thanks!

missile

You are only young once, enjoy it whilst you can.

Why take out a loan? You have £20,000 in the bank use that.

At 23 my question would be, can I afford the insurance?

Mobeer

Every sane, sensible fibre of my being is saying you should be thinking of something that depreciates a whole lot slower, like a property. Living with your parents is also the financially sound thing to do.

But I drive a Z4 and I love it to bits.

Could you not try a used Toyota MR2 as a sensible but fun choice at about 6-7k?

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I do love my Z4...
and you won't find a convertible flat...

ben80

Are you saying you have 20k and need to add a loan of 15k to afford it? If so, why not wait a year and then you won't need a loan.

I also agree with many here, I'm into cars (wasn't when I was your age) and if I had my time again, I would have got something cool like that,

......but for me it would be a TTS or S5 V8!
Do it!

david29dpo

As the interest on the loan will be more than the interest you are getting on your saving, not a good idea getting a loan.
Pay cash and get a big discount!

DKLS

Good choice, am currently looking for a coupe for the wife.

15k should get you into a very clean Z4MC like this

Or if the M is a tad hefty on the insurance try a non M, nice one here for 6k, stick some CSLs on and a non dating number plate you could pay cash, not make too much of a dent in your savings or have credit.

Check out the buying guide on Pistonheads.

111KAB

At 23 you should be looking a younger persons cars > Lotus Elise for you :-)

Tobster86

If that £30k isn't a London salary, at 23 it's pretty exceptional. Well done!

With that amount to spend on a convertible, why not go completely mental and get something like a Caterham?

http://www.caterham.co.uk/

Pure driving pleasure, motorbike-like acceleration from small engines, horrendously impractical! When I've got house buying out of the way I intend to build one.

LandyAndy

Using your savings/investments to buy it would be the cheapest option assuming you are confident you won't need the money in the near future.

But there is merit, in your position, in establishing some credit history by taking the loan and paying it back in accordance with its terms. Given the level you are able to save at at present you might think about taking the loan over a shorter period (2 years should be doable) to save some of the interest cost.

wba31

An "Ok salary at £30k??" thats a pretty good salary in all honesty.

As previously said, just buy one for £15k out of your savings, you'll quickly pay that back in over the year. go on some loan comparison site and get a quote for a £15k loan over 3 years, see what the total you'll end up paying back is? what's the point when you can buy the car outright now.

I wrote off a car once when i owed more than it was worth on a loan, worst feeling ever. I am saving for my next car, and it's slow and painful as i could do with changing cars NOW, but i know in not borrowing to buy it ill only pay the agreed price for the car (rather than interest on a loan) and if i do write the thing off i wont be owing money on a loan still...

floopnoodle

The money is there so you can afford it. However, I would think about what you want to do in the future.

Personally, with hindsight at age 29, I'd either go travelling for a year, maybe longer or put down a deposit on a house.

I bought a car for cash last year and after 6 months all the novelty had completely worn away, especially when I had to start paying for tyres, servicing, increased insurance and aircon repair. If I had to pay for it for the next 4 years on finance I'd probably feel a lot worse about it.