Supercar and an associate?

Love cars so much. I told myself I was going to wait until at least As4+ (Am currently An3), but I found a great Porsche 911 deal from a school alum. It's barely used and would run around $200k. I got a special rate from my bank for 4% financing vs like 4.6% I think?

I have about $100k in savings and really want this car. I'm in RX and feel like it may look bad if I wanna stay long term (as I do) as I am making a potentially financially poor decision as a person wanting to advice CEOs who made financially poor decisions. Please talk me into doing it 

Comments (81)

Jul 22, 2022 - 4:58am
conrx, what's your opinion? Comment below:

technically:

Assets: $100k cash

Equity: $100k 

Subsequently:

Assets: $200k car

Liability: $100k debt

Equity: $100k 

THEN we can start modelling out the impact on the 3 statements of the increased maintenance costs, the depreciation, the interest costs, the potential impact from loss of clients etc.  

Gotta say, were going to be looking at a good RX situation.  should be fun!

Jul 20, 2022 - 12:23am
ChrisQQ, what's your opinion? Comment below:

Not enough savings to justify the vehicle at this time.

Even if that wasnt that case:  I'd look at it this way, auction prices(car & watches) have been falling/slowing for the past 6 months, so this 'deal' may not look like that great of a deal in 6 more months.  You may be able to get it at a better price.   If its a long term collectible in your mind, I think its important to think whats really going to be a long term collectible in the Porsche market, they're not exactly rare. To say nothing of the costs of insuring, storing, maintaining a car to collector standards. 

No one knows what the future holds but I'm also holding off on my next watch and car purchase for a while. Many of us have been had modest losses in the market the past 7 months.. lots of cars and watches may start showing up if the market/economy/supply chain shits itself in the coming quarters.

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  • Intern in IB-M&A
Jul 20, 2022 - 12:29am

I feel like top ICE (internal combustion engine) cars are going to become a long-term collectible over the next 20 years more so than any time in history prior given that major manufacturers including great brands like Mercades Benz have announced all electric by 2030. Many brands like Porsche are trying to get exemptions to the European Union's 2035 ICE ban. Porsche probably can I would think. I guarantee you by 2035, electric vehicles will outperform ICE vehicles, but the driving experience might not be the same. Porsche specifically wants the 911 to continue as ICE because they can't achieve the same weight distribution right now with the current electric technology. I think that could change by 2035, but I'm not an engineer. Regardless, I think a lot of ICE cars will become collectible. 

  • Intern in S&T - Comm
Jul 20, 2022 - 12:33am

Yeah that has to be a turbo s. Why not settle for a c8 or 911 carerra (4)s to settle the itch? Even an r8. Save 60-100k and still have a supercar.

Jul 20, 2022 - 9:01am
ganbarapixto, what's your opinion? Comment below:

Agreed. The only way I would say do it if it was like 3/2rs or smth like a 22 touring otherwise ur money is better spent somewhere else. That's also assuming you would flip right away and get the 60-70k after tax. But then again no one is offering those sorts of cars at that price point, not even turbo s unless it's an allocation which u could also sell.

  • VP in IB - Gen
Jul 20, 2022 - 12:45am

I'd do only if my parents were loaded and my inheritance juicy. If you need to build substantial wealth on your own not a good idea at all to lock most of your networth in a depreciating asset. Also what 911 is this? 200k must be a turbo S lmao. That's crazy.

A new turbo s is going for far far more than 200k.  Like 75% more (and over list).  200k will get you into a well specced 992 carrera gts at the moment (which is also over msrp).  but the market is saturated and prices are coming down now across the board for sports cars

Most Helpful
  • Analyst 3+ in IB - Cov
Jul 20, 2022 - 1:27am

As1 here with a .1 GT3RS. The answer here is very dependent on what car you're buying here. Is it a 992 GT3, 991.2 GT3RS, or a 992 Turbo S? Any one of these three is a great buy at that price and you should totally do it. Your interest rates seem a little high but I got mine back in Jan of this year and so I'm paying half that. Try a credit union and see if you can get lower.   
I had a bit more savings than you do now when I bought mine, but you can actually comfortably afford a car of this level if you are smart about it. I bought mine low (relative to the market), put down $50K and took the rest out on a loan in the mid 2's. The car will never depreciate below what I have already put down. I drive it solely on weekends which minimizes added mileage. The monthly payment does not matter because I have enough cash to cover the loan remainder already, I just invest the rest of my savings. Insurance and maintenance have also been surprisingly low. My only regret is not having gotten a car like this sooner. I've always been a car guy and a huge motivator for me to work hard and get a great job has always so I can afford a nice ride. With the ICE being a dying breed, I wanted to have no regrets 10-20 years down the road if I've never had the chance to own my dream car. If this resonates with you, by all means I would jump to buy it.

  • Intern in IB - Cov
Jul 20, 2022 - 2:46am

That's awesome to be able to afford your dream car just 4-5 years out of college! Do you drive it to the office or save it for weekends, and do you know if you plan to keep it in the long run or upgrade later?

  • Analyst 3+ in IB - Cov
Jul 20, 2022 - 9:18am

It really is! I do not drive it into the office. The GT3RS isn't a great daily car - it's loud, there's very little sound deadening, even with the front axle lift it sits very low. We're WFH 2 days a week and with a short commute, I just drive a cheap beater although I could probably get away with only Uber.  

In regards to upgrading, I love mine and I don't have any plans at the moment to change cars. I've been keeping my eye out for a 992 GT3 but current valuations are still too inflated. I will likely stay with Porsche GT products. They suit my personal preferences being a little more driver-focused/engaging and slightly less flashy than your typical Italian competitor. Although the cool thing about buying an expensive car with low depreciation is you can keep trading it for other expensive cars and only pay tax on the trade-in difference. So you could actually switch into a new supercar every year at a pretty reasonable cost.

One other thing I might add is the car has opened a completely new world of friends and opportunities for me. With it I've met many similarly minded and successful folks in the car community in a wide range of professions. It's an utter joy to hang out, eat lunch, and go drive around town with buddies in their supercars. 

Jul 20, 2022 - 3:32am
npl9, what's your opinion? Comment below:

I daily a 991.2, bought as an As2. Absolutely go for it, it's been an incredible amount of fun. Im out most weekends to hit the mountains or some PCA meetups/tours, truly exhilarating experiences and I'm so thankful I pulled the trigger on the purchase.

I've personally gone light on housing (studio) and my fixed expenses are at or below other associates who have more typical cars but more living space. I just get more enjoyment from the car than I would from an extra wall or two in an apartment. This isn't really necessary (you can do both and it won't really matter that much) but just some background on how I've thought through it.

Jul 20, 2022 - 5:02am
JRswede, what's your opinion? Comment below:

OR:

1. Invest the 100k in a dead index-fund 

2. Gain an average of 8% returns 

3. At year 50, your 100k is worth roughly 4.6 million. 

Alternative cost is brutal when you can't afford it in the first place.  EDIT: this is basically buying a depreciation thing WHILE paying interest expenses vs earning potentially millions

  • Intern in IB - Cov
Jul 20, 2022 - 6:18am

Well gee people must be idiots for spending hundreds of dollars on fine dining--everything turns into shit anyways so might as well just eat grass and invest that money into a "dead index-fund" especially since food depreciates in a matter of seconds

Better yet, why bother renting a condo in the city when you could just live out of a shopping cart and have a 5 minute commute to work--you could take your savings of thousands every month to buy bitcoin and become a trillionaire in a thousand years! 

This guy has single handedly cracked the secret to life--take ALL your money and just put it in index funds and let it accumulate until the end of time

  • Analyst 1 in PropTrad
Jul 20, 2022 - 11:56am

Everyone dies - people quickly point out the immense compounded returns you'll have at 40, 50, 60, 70, etc. There is value in being able to spend or experience some of these things when you're young and in your prime years for travel and experiences. Being able to go to a track with my dad (a huge reason I'm a car guy) in a 911.2 and experience something with him that I might not be able to in 30-35 years when he's dead and gone is valuable to me.

Why do people spend hundreds on dinners or thousands on vacations, etc.? They could just be investing everything, and at 60-70, they'll have millions of dollars, right? It's because at some point actually having these experiences when you're young with people you love who might not be there down the line, whether that be a girlfriend who at the time you love who you break up with or a family member who's always wanted to do X who might pass away by the time you reach your fortune.

If this person is a car guy who spends most of his free time on a track, at car meets, or watching car videos just dreaming about the day he will be able to drive one of these cars, that is the kind of person who should be thinking about this decision. If there is a chef who's spent 5-6 years mastering his craft, hoping one day to learn from the master's and has the opportunity to travel to Japan to learn from a master sushi chef for two months and he highly values this experience, having it a few to dozens of years earlier is valuable; there is more to it than just a $ amount for some people. Just always be aware of the opportunity cost but don't let people telling you to put 100K away and let it sit in a fund for 40 years make you sound stupid for wanting to experience your dreams. 

I'd say 75% of car guys would advocate for this while 25% would be more cautious, but 95% of non-car guys will be more cautious - it just isn't worth it to them. Is it worth it to you given the opportunity cost?

Jul 20, 2022 - 4:54pm
bobmiller123, what's your opinion? Comment below:

As an HF analyst, I'm pretty frugal in general but when it comes to things like vacations I'm not one to be cheap.  My dad always wanted to go to an F1 race in Europe so I took him there few weeks ago.  He's getting older and I'm not sure he'll be here any longer so worth the sum I spent.

Jul 23, 2022 - 8:06pm
Mr Incredible, what's your opinion? Comment below:

Ngl while OP is making a terrible financial decision, I wouldn't want to wait until 50 to buy a car like this as someone else who loves cars. I really want a Tesla Roadster. Got to launch a Model S at a track, and it was the coolest thing ever. 

Jul 20, 2022 - 6:58am
703_native, what's your opinion? Comment below:

Do it. You won't even care about or eventually remember the money you spent/opportunity cost. YOLO, and as other people have pointed out, EV mandates are coming. As someone who had an E55 AMG and X5 M in their twenties with minimal savings, and years later still whipping the vintage mustang that's been in my family for close to 60 years, you will wish you had done it sooner. Others noted it but if you're smart with maintenance, mileage, and generally take care of the car, annual cost doesn't have to be insane. It doesn't make sense for me right now with kids but I will have a 911 (tbd on which one) once I can get away with less seats. If regulations really get out of control and it's all EV sooner than people expect, there will be a rush for these vehicles. Guess I'll be installing lifts in the garage.

Jul 20, 2022 - 12:15pm
GoingToBeAnMD, what's your opinion? Comment below:

User name checks out . . .

*
  • 1
Jul 20, 2022 - 12:36pm
Jaded Rainmaker, what's your opinion? Comment below:

Am not a car guy at all (even if I admire nice cars). 

Honestly, in your shoes, if I were passionate about this, I would do it. Your savings right now don't matter that much. What matters is that you are on a solid career path and that you make sure you keep motivated so your value can increase exponentially over next years. It's important to have fun outside of work and it's great to be able to afford "childhood dreams". You have one life, go live it champ!

Jul 20, 2022 - 4:58pm
Isaiah_53_5 💎🙌💎🙌💎, what's your opinion? Comment below:
UsedPorsche911

as a person wanting to advice CEOs who made financially poor decisions. 
 

It's "advise."

"If you always put limits on everything you do, physical or anything else, it will spread into your work and into your life. There are no limits. There are only plateaus, and you must not stay there, you must go beyond them." - Bruce Lee

  • 1
  • 1
Jul 20, 2022 - 5:27pm
Isaiah_53_5 💎🙌💎🙌💎, what's your opinion? Comment below:

Thoughts @ GoingToBeAnMD?

"If you always put limits on everything you do, physical or anything else, it will spread into your work and into your life. There are no limits. There are only plateaus, and you must not stay there, you must go beyond them." - Bruce Lee

Jul 20, 2022 - 5:41pm
SafariJoe, what's your opinion? Comment below:

UsedPorsche911

Love cars so much. I told myself I was going to wait until at least As4+ (Am currently An3), but I found a great Porsche 911 deal from a school alum. It's barely used and would run around $200k. I got a special rate from my bank for 4% financing vs like 4.6% I think?

I have about $100k in savings and really want this car. I'm in RX and feel like it may look bad if I wanna stay long term (as I do) as I am making a potentially financially poor decision as a person wanting to advice CEOs who made financially poor decisions. Please talk me into doing it 

Once. You buy it, I shall see you on the roadstr app.

SafariJoe, wins again!
Jul 20, 2022 - 6:37pm
Isaiah_53_5 💎🙌💎🙌💎, what's your opinion? Comment below:

Yeah and post pics here guys please - I love super cars too. 

"If you always put limits on everything you do, physical or anything else, it will spread into your work and into your life. There are no limits. There are only plateaus, and you must not stay there, you must go beyond them." - Bruce Lee

Jul 20, 2022 - 6:49pm
SafariJoe, what's your opinion? Comment below:

Isaiah_53_5 💎🙌💎🙌💎

Yeah and post pics here guys please - I love super cars too. 

Sadly, this app makes it difficult to post car pics.

SafariJoe, wins again!
  • 1
Jul 20, 2022 - 7:55pm
Pizz, what's your opinion? Comment below:

YOLO. You're going to be making more money in the future and this purchase will just be a blip to you, assuming things work out. You should go ahead a buy that car. 

Jul 20, 2022 - 8:00pm
Isaiah_53_5 💎🙌💎🙌💎, what's your opinion? Comment below:

LTPHKT

Listen

To

Pizz

He

Knows

Things

"If you always put limits on everything you do, physical or anything else, it will spread into your work and into your life. There are no limits. There are only plateaus, and you must not stay there, you must go beyond them." - Bruce Lee

  • 1
Jul 20, 2022 - 9:45pm
Isaiah_53_5 💎🙌💎🙌💎, what's your opinion? Comment below:

TryTheDip

Damn, now I don't feel so bad about springing for premium economy for my flight to Barcelona last month

lol

"If you always put limits on everything you do, physical or anything else, it will spread into your work and into your life. There are no limits. There are only plateaus, and you must not stay there, you must go beyond them." - Bruce Lee

Jul 21, 2022 - 6:51am
thebrofessor, what's your opinion? Comment below:

My answer to all of these questions is a question: does it take away from your other financial goals? If yes, then pause. If no, then ask if you want it versus other available alternatives, and if yes buy it and don't look back. If you're unsure because you don't have goals, fix that first.

I've toyed with the idea of a Porsche because I love the engineering but practically speaking I'd be driving it in traffic only and on weekends, a better opportunity for a joyride in theory, I like to go to the beach and there's no room for surfboards there, so I've instead favored driving experiences. Plus, I'm a big believer in keeping fixed costs low and paying for experiences

Jul 20, 2022 - 11:06pm
Waymon3x6, what's your opinion? Comment below:

Do what you want. I bought an R8 as an Associate. Daily drove it for 2 years. To the office, on road trips, went on car rallies. Put 35k miles on it. It was great.

I'd say if $100k is all you have in savings, wait until you get into PE or something after IB (out of the city) and then spend the $. Prices are crazy right now, it's not worth it. I would not buy a car in this market (used or new). See how you feel in a year. And by then, you might be able to get something better than a Porsche. Or you might not want one at all. 

I'm all for the "you're only young once" which is why I got mine. But a lot of things fell right for me to justify it - it's not just "I have $100k and want an exotic car". You have to get parking. Insurance, tolls are a bitch (if you're in NYC) not to mention the traffic - that takes a lot of the fun out of it. With a loan, you're looking at $1,500 - $2,000 / month just in parking / payments. It's like having two apartments. I was single too, so that helped. But it wears off, quick too. It does pay to wait. But do what you want.  

Array
  • 6
Jul 21, 2022 - 12:50am
BillyJoe1357, what's your opinion? Comment below:

AN2 here - Was fortunate enough to have padded enough savings young to chase and buy a 718 Spyder. I'm not sure at $200k it would be good choice right now to go for 992 (assuming this is either a highly highly optioned C4S or GTS) but could be worth holding off here a bit. Maybe go for a CS? I was previously in market for a 992 C4S given commute and car enthusiast needs but settled for an albeit "cheaper" Spyder that is equally as fun and daily driveable as a 991. However, with the path the ICE is headed I wouldn't blame you if you jumped the gun here for a good time…if it bothers you enough to worry about what the office feels, client sees and probably how your wallet will react definitely reconsider/wait. 

Jul 21, 2022 - 12:56am
BillyJoe1357, what's your opinion? Comment below:

I will say though…no car quite feels the same after getting into and driving a Porsche sports car…if you do go for it I'd be happy for ya! 

Jul 21, 2022 - 10:50am
CarsnWatches, what's your opinion? Comment below:

Even with my username this amount of expenditure on a car versus your net worth makes me a little nervous. No doubt the car will hold value and even potentially appreciate, but it would still make me stressed about my financial situation. You never know what could happen to you one day and you not be able to work or generate income. I suppose if you come from a wealthy family or have a safety net then that's a moot point. 

Jul 21, 2022 - 11:16am
Miracle1111, what's your opinion? Comment below:

Fuck it go all out, buy a few chains, rent some bitches, and buy out the bar. You only live once. Send your MD some hoes too, if he likes it you're in good with him for life, if not then it will make a good story.

Jul 21, 2022 - 6:08pm
WS_Jerry, what's your opinion? Comment below:

I'm kinda in the same boat but a few years younger. I've set the same target for a Ferrari F430. I've loved the car as long as I've been into cars. I cover automotive and I just love cars. To me they're art. I'd say go for it if you can afford it. However, make sure you'll use it and can afford maintenance, insurance, etc. If I can lease hack an apartment in the next year or so, then I will do it as my costs will be lower and I could put my rent money into the car payment.

I think I did this right

Jul 21, 2022 - 6:19pm
HopingPEisThepromisedLand, what's your opinion? Comment below:

Thoughts on a recently minted second year analyst buying a BMW M3 F80 or G80? Should be getting first year bonus soon...

Jul 21, 2022 - 8:34pm
eloquence, what's your opinion? Comment below:

$200k is completely ludicrous in your situation, IMO. If the car was $50k... even $70k... which you can definitely find a used 911 at that price point... I would say fine, do it if that's your one splurge. Wiping out your entire savings AND having a $100k car loan with 4% interest is not a good idea

People generally don't care about what cars you drive, you won't get a second glance showing up in a 2022 regular Porsche, but a $200k car is ridiculous unless you're a successful D/MD and people will question you a bit

Get a used model and revisit this when you have the entire purchase price liquid and aren't RXing yourself to afford the monthly payment

Array

  • 2
Jul 22, 2022 - 7:05am
TheBuellerBanker, what's your opinion? Comment below:

Dude 200K for a 911, as others have plentifully covered as to why it's so absurd, is absolutely asinine. A good friend of mine just ordered a 2022 911 like last week which he has to wait 12-18 months for but was able to pay MSRP instead of inflated dealership prices, only paid 120K and that too because it was so spec'd out. Your buy-in price is absolutely ridiculous and unless (again as stated above but I gotta chime in) it's a GT3 or a Turbo / any of the Turbo variations, there is no reason you should be paying 200K for a 911 ever.

  • 2
Jul 26, 2022 - 9:40pm
SafariJoe, what's your opinion? Comment below:

Right now I am struggling to decide between a 991.2 and a 992.1 4S or turbo s. This is a difficult decision to make. 992, offerings for the interior not much in the offering. Axel lift good, colors not much....

SafariJoe, wins again!
Jul 26, 2022 - 10:23pm
jmw5510, what's your opinion? Comment below:

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Jul 26, 2022 - 11:45pm
Isaiah_53_5 💎🙌💎🙌💎, what's your opinion? Comment below:

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Rerum eum nemo mollitia explicabo. Dolorem illum dolorem animi quis. Est voluptas odit incidunt possimus aut tempore. Nihil qui architecto eos cumque tempore. Rerum veniam quia nisi nam unde. Ut eligendi magnam expedita labore dolore consectetur modi.

Vel dolores dolor nisi possimus dolore consectetur voluptate. Sapiente sunt enim qui facere sint et amet. Dolore quod tempora expedita maiores quasi. Id qui maiores animi porro totam. Magnam modi accusamus est eligendi.

"If you always put limits on everything you do, physical or anything else, it will spread into your work and into your life. There are no limits. There are only plateaus, and you must not stay there, you must go beyond them." - Bruce Lee

Jul 26, 2022 - 11:49pm
ElMonkéGrande, what's your opinion? Comment below:

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Quis reiciendis esse velit quisquam. Molestiae voluptas et aperiam laboriosam. Hic dicta odio cumque. Perferendis porro sint error quia. Quisquam beatae aut dolores dignissimos qui sapiente asperiores. Aut ea possimus vel rerum omnis.

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