Is this a dumb purchase?
Will try to keep this short:
Am an IBD analyst in a city outside of NYC. Wanted to buy a car and I can get decent-mileage C6 Corvette for $32K all-in (yes they are actually that cheap). The MSRP for this kind of thing was obviously originally almost double so it's pretty far depreciated as-is.
Figured I have no family, kids, etc at this young age so would be probably be the only appropriate time to get a fun 2-seater. I don't actually commute so this would just be for some weekend fun and to keep for like a year or so before trading in for something more practical or just selling because I move or whatever.
I have more than enough saved/invested to just buy it all in cash right now but figured why not just put like $10K down and finance it and have my liquidity and the ability to keep investing even if financing rates are high (for now at-least). After the down-payment, my monthly payment + insurance will be 10% of my POST-TAX monthly pay.
I'm a pretty frugal person and was pretty adamant about not buying anything but for just $10K + 10% of my post-tax monthly pay, I'd be pretty much living the same lifestyle as I am now but have a fun ride. Would expect to get a majority of the value back anyway upon sale anyway but again I suppose many people on here see the auto market falling very hard.
I also don't want to look like a douche or a spoiled kid with parents money when it was pretty much the opposite for me ha. Just have been working since I was 15 and was saving/investing for a while. Maybe some other car guys can chime in but a C6 is about the best value to performance/reliability I think you can get.
Open to thoughts thanks.
If it's something you're excited about and will give you a little juice, you should go for it. Especially if you're working a demanding job, you need hobbies and passions that give you something to look forward to. Who cares what anyone else thinks.
My dad has had a couple C6s, always getting them on the cheap and doing meticulous rebuilds/detailing to the extent that you could eat out of the engine bays. He can't wait to get home from work and get on the corvette forums or get in the garage and polish another (already clean) panel on the car. It makes him happy as hell.
I'm in NYC but have a car in another city and pay ~$400 a month for it. I probably drive it maybe 2 weeks out of the year, but my thought process is I would never use a sports car / expensive luxury car as a daily car. When I'm in a better position and the car is paid off, then I'll go out and buy something flashy as a weekend car -- until then I'd rather have cheap car payments and spend most of my money on drinks / food / traveling / concerts.
Do your future self a favor and wait until you've made it before you go out and buy something flashy before the repair bills and insurance catch you off guard. I would highly suggest leasing a fully loaded Lexus or Acura. You'll get the power and flashiness you're looking for without the extra costs, and you can refinance in ~3 years when rates are in a better place.
Thanks for the response and what you noted is about a hundred bucks less than would be my payment. Which Lexus or Acura are you looking at because they look to be about the same price if not more than the c6?
Not a dumb purchase at all. When I was younger and making less than you likely are now I dropped around 40k on a similar purchase (an M3 if you're curious). I was in a slightly less ideal financial situation relative to you, but pretty similar.
Think about it this way; when you get serious with your GF years from now and need to plan for a child, a wedding ring, and a mortgage you will thank me. You wont be able to buy the car then, but you will be able to sell it to cover the cost of the ring and some of the mortgage.
I wont part with my M3 until I absolutely have to, as she has brought me so much joy in just a handful of years. Plus my comp nearly doubled since making the initial purchase and while the monthly payments are still material, I could pay off the car tomorrow with the cash in my savings account and still have enough left over for 1 years expenses.
This is all based on the assumption that you are, in fact, very frugal. If you are actually a frugal person and you have enough saved to account for a layoff until you can find a new source of employment, you will be absolutely fine.
PS, my old man has the C8 and it has introduced an appreciation for vettes I never knew I had.
PSS, if you buy a C6, make sure you track it. Find out what the car can actually do. That is, after all, the purpose of these types of vehicles.
Thanks for the response. An M3 is super nice. And likewise, I do think a C6 will hold up decently well in value to sell/trade later on down the road.
What year? I have a non-beaten on E36 lol
Why not rent one for a couple of times first and then decide if you want to buy? Maybe it disappoints, maybe you love it. Either way makes the decision easier
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Doesn’t seem like a bad purchase at all. I’m a huge corvette nerd after and wanna buy a C6 zo6 at some point in the near future.
Go for it man make sure to enjoy it for the rest of us:)
Cheers
Yup, the z06 is a true beast for sure. Don't want to go to crazy with the spendin just yet for that ha!
If it is decently low miles (like sub-30k) and manual it should hold its value over next few years. I picked up a 911 as an analyst 2.. being able to get out of NYC every few weekends and driving that around definitely helped me through the analyst years and gave some validity to the job. 100% buy the Z06
Damnnn a 911 is real nice congrats on that. What I’m looking at has a bit more mileage than that closer to 60k but think the relatively lower price of a C6 base is more than enough power for me :) thanks for the response
That's interesting, how did the financing for a 911 work out as AN2?
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Don't know a ton about cars, so will let others chime in and correct me, but from my understanding the C6 holds value pretty damn well at this point. If it is was something else, I would have said no but your total loss from this when you decide to sell the car even after running up another 20K miles will probably be not more than 10K
$32k is probably, what, 20% of your total salary? Even if 25%, you're in a lower COL city. While 25% might be aggressive for a new car, this thing is through it's depreciation curve so I wouldn't call this aggressive.
Yeah if we're assuming bonus, then about 20% of pre-tax which is still a lot in my mind but I am viewing this like you said with it's depreciation in mind and almost treating it like an "asset" (know that's a big no-no for cars but the loss isn't going to be a huge sum of money ~10K or so later on down the road)
In 10 years that car is going to be nearly worthless. And on top of the purchase price you’ll have spent a small fortune on maintenance/service, gas, and insurance.
If you need a car, buy a lightly used one for $15-20k, invest the $15k difference, and it will have appreciated to $30k in 10 years (at 7%).
Similar situation kinda so following. Let's assume you manage to rack up a bunch of miles over the next year (you very likely won't if not even commuting), I don't imagine 10-15 year old American V8s depreciating much more than they already are. I don't want to come off too optimistic for you but I wouldn't be surprised if the sale price is the same if not slightly higher in a few years (ofc dealers still want a profit so it won't be an actual "profit" for you)
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