FurLover

Hello!

I am new to the forum as I am currently researching the purchase of a new C7.

My first post is actually an odd one, about financial advice.

I am someone who is fairly frugal but am willing to spend the money on the car. Yet, the practical side of me is saying don't do it. Here is my situation...

I am 35 years old and make just under 100k a year. I contribute regularly to my 401K and max out my Roth IRA every year. The only debt I have is my mortgage and whatever monthly expenses I buy, mainly food. I also have a daily driver which is paid for.

I am single with no children.

I plan on putting a substantial amount down on the car, just to lower the payments, probably around 20k or so. My car specd out is about 61k, so I'd be looking to finance around 40k.

On paper it looks like I can afford it. But I am torn. The practical part of me says I can take the money and put it towards my mortgage, either every month or with the down payment. Or I think, I can purchase more stocks, play dividends, buy more mutual funds, etc... and just keep waiting, and waiting, and waiting. But then I say, "where's the fun in that?" That's when the side of me says, "You love these cars, you have wanted one since 2005 and the C6, you have had a goal to reach to be able to afford one. Go ahead and get it and enjoy every moment of it."

So what should I do? Should I play it practical and behave, be responsible with my money, and just wait until I retire in 30 years before I buy a Corvette? Or should I indulge in the car and enjoy my life today?

By the way, my job is extremely stable, it isn't going anywhere.

CdnVetteOwner

Interest rates will never be lower. This is the best time to borrow. Sounds like you won't be over extending yourself, especially not having a family to support.

You only get one life. Once your gone, it's done. You may as well enjoy it.

That's how I look at it anyway.

But at the end of the day, only you can make this decision. Nobody else, including me.

HighTeq

Yolo

F4 Phantom

theanswriz42

I bet if you go through a dealer that will honor the credit union discount, you can save even more on the car. As CdnVetteOwner mentioned, you're not going to find lower interest rates anytime in the near future as today.

LanceVette

Sounds like a Suzy Orman episode.

LDYSTIG

I am 25 with a mortgage and no kids. I make less than you and was able to make a Corvette payment work (I actually did the exact scenario you proposed and financed $40K - my monthly payment is $698 with 60 months/1.84% terms). I contribute 10% of my income towards my 401K and also have a Roth IRA through Chase that I dump money into whenever I have "monthly leftover funds." I have always been a really good saver and budget conscience person but life is not worth living if you don't reward yourself every once in awhile, too!

So financially can you afford it? Probably. Are you comfortable with doing so? Only you can answer that question.

LincolnUSA

subscribe to the theory that my toys will be paid for with cash. Owing 40k on a car would drive me nuts. Don't think I would ever enjoy the vehicle. Save your money and buy when you can pay w cash.

rkoblin

Leave your savings alone. A car is a (even a Corvette is a depreciating asset). If you can't afford the car, you can't afford it. Lease the car if you want it bad enough. You can still buy it in 3-5 years. At least you will save more money.

theanswriz42

Why? You can make a far better return on the market than 0.99% to 2% that you would pay out in loans. To me, it was a no brainer to finance nearly the entire car and invest the money that I would have otherwise put down on it.

bapd77

I am in the same yearly income bracket as you and have another car payment and can afford my mortgage and both car payment just fine with money left over to put into savings and live. I also have no credit card debt and a lucrative pension. If you can't afford a 40k car loan on 100k salary I'd say you're being too frugal or your house payment is too high

Steve_R

OP, you are in FAR better financial shape, including retirement savings, than probably 99% of people your age and even much older. The real question is whether you should scrimp for decades and not enjoy life as much as you could just so you can retire with more $$$. That's not a balanced life. I've seen far too many people do that, and then their health goes away or something else happens and they never get to enjoy the fruits of their hard work. That's no way to live IMO.

We decided long ago that we wanted balance in our lives, so we live and enjoy life now and save for retirement. We don't spend our money stupid, but we aren't misers either. I'm on my second Vette, we take nice vacations, we spoil the grandkids, etc. AND we have a lot saved for retirement.

Everybody needs balance in their lives. From what you've said you can easily afford a C7 and still live comfortably and save for retirement. Given that, I'd ask why NOT drive the car you really want? Life is too short to save every penny for a future that may or may not happen the way you want it to.

bapd77

Well stated!

jmiliz

If your credit is good money is so cheap now I would finance the entire amount. Put the down payment money toward an investment (mutual fund, etc.). You should easily make more than the interest rate on the loan. I have very wealthy friends that are always waiting for the perfect deal, always shoping around and never end up buying and enjoying what they want and worked so hard for. Sounds like your have a great start financially so far. Enjoy life while you can.

theanswriz42

Steve_R

This! Big time this!!! Most people make financial decisions based on emotions and feelings and not on solid facts. That's how you make bad financial decisions.

Mr Guns

I love cars, and they are more to me than transportation, so I don't feel bad about spending money on them. I didn't spend $60k on my car as a status symbol, but rather as something I'm passionate about. I've had the car almost a year, and I still love having it and driving it, and I don't expect the enthusiasm to fade any time soon.

NormR

Consider purchasing a low mileage 10 to 15 year old Corvette with cash (they are out there and in great condition). I did that twice and when it was time to sell, sold them for close to what I paid for them. At your age focus on becoming debt free and over fund your retirement, you will never regret it and in time, you will pay cash for the car of your dreams!

Grozny

I'd say do it if you really want it. You're assuming you make it to retirement. Tomorrow isn't necessarily a given. While interest rates are low, I would think GM will eventually bring back 0% apr. Also, I’m sure if you wait you’ll eventually be able to save a good chunk of change too. Back in 2012 a 1LT coupe could be had for $35,000 when msrp was $50,000, and a 1lt Grand Sport could be had for $42,000. However, I don’t recall seeing as aggressive pricing on the 2013’s. So looking at the situation from a frugal point of view, there’s definitely meat left on the bone in regard to pricing on the Stingray. I’d say at this point in time, I’d at least wait to see what the specs are for the 2016 model year. I know we've now seen GM employee pricing being offered to everyone. I've personally considered going that route. However, having to pay $1500 to ship the car and settling on a color I didn't want, I’d only come out a $1000 ahead of using credit union pricing and doing a courtesy delivery.

bapd77

I don't agree with overfunding your retirement. I feel you should enjoy life. You're living in the now and planning for the future is important, but remember...the future is never guaranteed. Sacrificing some luxuries for a future you may never experience is not reasonable to me. I have a pension I very much hope to draw one day, but that isn't a certainty. I believe we should have balance and enjoy life now as well.