What % of disposable income to spend on car?

caprikid1

The far more important question is ... WHAT CAR (-;

mrsmortgage

I'm torn between a Q5 a Q7 or an e-tron

iwb100

mrsmortgage said:

I'm torn between a Q5 a Q7 or an e-tron

Are you talking personal lease or is it a business lease? Personal lease means you are in the realm of £600 a month or significantly more for the e-tron.

Also VAG (Volkswagen Audi group) are prioritising purchases and it’s incredibly hard to get a lease car built. I know people who put their lease order in over 12 months ago. Still waiting. With no sign of a build date. 

jimjames

mrsmortgage said:

What % of disposable income is a sensible amount to spend on a car? Taking into consideration that this car is also considered a hobby of sorts.

Purchase price or monthly payments?

400ixl

mrsmortgage said:

I'm torn between a Q5 a Q7 or an e-tron

I thought you were a car enthusiast and then you posted that . No one knows your situation better than you, all that can be advised is to not stretch yourself and think about both the present and future finances. As mentioned, have you got that 6 months of outgoings put to one side (including the costs of this lease), is your pension on track to be able to afford to retire at the age you want at the level of comfort you want.

Coming into money often makes people want to buy things on a whim that they don't really need, step back and think long and hard, especially at the moment with cars as you could be making a financial commitment that could be many months away from starting, but still a commitment.

mrsmortgage

My pension is kind of laughable at this point, but given I'll move back one day to sunny MX, that money will be more than enough.

Currently our joint income is of £100k, 75% of that being my income.

Thanks to COVID I don't have to worry about working remotely, so I think I'm ok for my line of work.

I've got about 500k tied in overseas property.  And I'll be getting £75k in the upcoming months (thus thinking about the car). 

The good thing about committing now to the car is that you can cancel at any given moment in the next 6-9months. Basically as long as the cas hasn't been shipped. 

mrsmortgage

jimjames said:

mrsmortgage said:

What % of disposable income is a sensible amount to spend on a car? Taking into consideration that this car is also considered a hobby of sorts.

Purchase price or monthly payments?

Monthly payments

Herzlos

mrsmortgage said:

A) I've finally received (part of) my inheritance. Sure I could pay a car outright but the type of cars I like depreciate like crazy.

I tripled my income! Yes miracles do happen (and I'm on the right track).

C) Part of the situation was due to my husband spending (that has been sorted).

D) I have cancer, I want to at least have some fun given all I've gone through. 

Pretty much nothing depreciates like crazy at the moment. Especially if you buy it at the right time. A lease is just going to be an expensive contract with little flexibility.

Though what I'd be more inclined to do in your position is to look at luxury car rentals - try out a few really nice cars for a weekend here and there rather than paying to lease one to drive to the supermarket in. Or go and buy something bonkers in cash - Nissan Skyline, GTR, a Caterham or something and then have fun. Then you can even take it to a track without violating your lease

Edit: I just spotted you're looking at Audi SUVs, so maybe getting a weekend racing car isn't quite what you had in mind.

JustAnotherSaver

Unanswerable question.

Or rather it isn't, but everyone's replies will be irrelevant to the next person.

I've always bought in the £1,000 - £2,000 bracket.

Things have changed lately with second hand cars being 'worth' more than they should be but it is what it is. If I replaced my car now I may have to switch that to £2,000 - £3,000, who knows.

As for how that tots up in to a % figure of disposable income - I have no idea.

I go to work, I earn money, it goes in to the bank, bills get paid, stuff gets bought, money goes over to savings which builds up, goes down, builds up, goes down & eventually when a car needs to be bought it gets bought. Job done.

What I absolutely flat out refuse to do is 1) rent a car (as in not buy it outright) and 2) pay what I feel are ridiculous sums for a car based on my earnings of approx £25k-£27k (yep I know I broke the hush hush rule of people not wanting to discuss what they earn but hey ho, there's many that earn way more & also plenty that earn less, it is what it is). Anything in double figures is just auto-daft when I could put that money towards the house or retirement in my eyes. If I was earning £100k per year then my budget would probably go up but I'm not so it doesn't.

Herzlos

On the how much to spend front, I think it's important to hedge your bets a bit about future expenditure. There's no rigid number (though I've seen 33% mentioned before), but you need to allow some room for stressing your budget - can you still afford the car for the duration of the lease if you see a drop in salary or have other big expenses? Is it good value?