{ "media_type": "text", "post_content": "135k base and I would like to buy a Porsche. I have 20k in student loans and no other debt.\nGo for it? I'm not even into cars but every time I’m dashing through the Target parking lot and see one, it’s like love at first sight😍. That is my only justification 😂", "post_id": "618fa902a50418002db76eba", "reply_count": 459, "vote_count": 76, "bowl_id": "552d1d24dc1c586b09d2d051", "bowl_name": "Consulting", "feed_type": "crowd" }
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135k base and I would like to buy a Porsche. I have 20k in student loans and no other debt.
Go for it? I'm not even into cars but every time I’m dashing through the Target parking lot and see one, it’s like love at first sight😍. That is my only justification 😂

likefunnyhelpfuluplifting
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There are a few things to factor in, A. What Porsche are we talking? B. New or Used? C. Timeline? D. Do you have a family or other obligations other than your student loans? E. Where do you live? In a city, suburbia, alone, at home, or with roommates etc. ( this can identify whether you need a car (city vs suburbia), if you live at home or with roommates and are splitting or don’t pay rent then that changes things entirely (or think of using the liquid cash flow to invest in a rental property, then use the profits to pay for a car)

D is a really important point to consider first though. As is E.

IMO, pay off the student loans aggressively, then possibly invest in a multi unit property, rent out one or multiple units, and wait about a year, then use the money you make off that to buy a nicer Porsche or the same one without feeling bad about it later, and by then the market frenzy for cars would have subsided because the supply chain would have gotten better and chips would be back in full scale production to meet the market demand. So you won’t unnecessarily get screwed paying for an overvalued product (a car not specifically a Porsche) my parents have had 2 and they are absolutely amazing and you can’t go wrong with a Porsche.

Another factor is if you absolutely need a car ie. your lease is coming up or your car died and you need a car etc. which is a bit of a different story but still holds most of the same points

A lot of people are mentioning rental properties but I'm still not convinced it's an advantage over just investing in the market, or a REIT if you want to invest in housing specifically

All it is is cheap leverage, but there's plenty of instruments to get leverage in equities that are fairly easy to obtain.

Equities are also liquid, e.g. you can cut losses by pressing a few buttons on your phone. They can be hedged. Equities don't demand very much of your attention like something breaking in a house you own 3 states over, and as long as you're investing relatively long term they are tax advantaged.

If I were to go back in time and hold my net worth entirely in Patek Nautiluses it would do better and be more liquid than rental properties lol

That said I do plan to buy an expensive primary residence (essentially rent to myself)

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Thank you everyone encouraging OP to buy the Porche. You're the main drivers behind wild American consumerism and living beyond our means.

No denying the car is extremely nice. But the priorities of sacrificing a better future for pleasure now is what I don't get.

likefunnysmartuplifting

You must not have seen my suggestion for OP to purchase income producing real estate, to pay for the car lease :)

OP, your base qualifies you for BMR (low income) housing in many major cities…

likefunnysmarthelpful

There is nothing sadder than someone driving a car they clearly cannot afford

likefunnysmart

I drive and have fully owned a 2008 Porsche Cayman (base) in Guards Red since I was a new hire with a salary of $78k

Cost me $18,000 to purchase ($400 spent before buying at a Porsche indy to check the engine for bore scoring and do a PPI) and I have spent $160 total in maintenance doing my own oil changes, + $1200 for a new set of tires.

Also, the car is currently worth around $22-24k, up $6k from what I paid (I understand COVID market, but even without it I would not have lost $ at $18k)

If you know the car market and can do your own maintenance, you can make good purchases, even from "expensive" brands. Even with the new 911s, most I have seen are selling in the used market for over sticker with 3-4k miles...

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This discussion is crazy. Didn’t realize people had so much judgement about other person’s happiness and spending. If this makes you happy, get it.
Some people spend on mortgage, some on kids, some on clothes, some on travel. If you don’t have any other huge expenses and this is your priority, go for it.
Don’t know your YOE but you ll likely make a lot of $ over the course of your career. Enjoy life

likefunnysmart

A13 you could just not be a car guy.

I’m a car nut. I’d rather spend $1500 a month or cars and work an extra year or two - or just not travel or drink alcohol.

IMO - we only have 10 years left before everything is electric. So now is the time.

Regulations are killing cars

likesmartfunny

Just do it. I bought a 120K car at 23 and now a 180K one at 26 and they were both fantastic decisions. The feeling you’ll get every morning when sit in your car and see the porshe emblem on your car is irreplaceable. It’ll make you grateful and it’ll make you hungrier to work harder. People who drive beat up used Subarus while making 200K never enjoy life and end up dying of heart attacks before they can even access their 401Ks

likefunnyupliftingsmart

I’ll rephrase, if you fall off your skis or bike and die, you’ll regret not having a nicer car to take you places. Also in what universe does owning a nicer car preclude your from those activities lol.

Definitely a no. Cars are a horrible investment and right now, because there’s no inventory, cars are selling at a price 10% higher than the same time last year. If you don’t currently own property, id concentrate on saving to buy a house or condo first. It’s an amazing investment vehicle for so many reasons, not the least of which is that you own a big, appreciating asset, but only had to put down 10-20% to buy it, not to mention that mortgage rates are in the 2s, which is like free money compared to historic rates.

likesmarthelpfulfunny

PwC10 that’s just not true. You start to gain equity from your monthly payments and the equity has real value. The ROI on a house is usually negative even with appreciation but is a much better deal than the ROI on renting in many markets.

The difference is home equity appreciates while car equity depreciates.

Rent one for a week get it out your system

likesmart

Umm and buying the $80k car isn’t?

likefunny

As someone who is planning to retire at 42, I would say no.

likehelpfulfunny

To some people buying expensive cars does make them happy? Who are you to judge what makes someone happy - you’re just as bad as the people you are yelling at for “feeling bad” for you.

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How about you pay off student loans first?

likesmart

I don’t see what’s wrong with it if you really want it and will pay off all debts first. Go for it.

As a lover and former owner of a 911 I say "Do it." But I'd advocate for taking your time and finding a good used one. The prices are ridiculously inflated on eBay and a lot of markets. But Craigslist and similar have legit folks looking to sell good vehicles. Just make sure to get a pre sale inspection

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I live in snow country. A Porsche here is just not coveted. The lineup of SUVs, however, is spectacular.

Go for it! Lease one and see if you really enjoy it. If you do, finance a new one in 3 years.

likeupliftingfunny

Leasing is a bad idea for a Porsche. With the low residual values that Porsche assigns, you spend more on the lease than if you bought it now and then sold it in a few years

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Don’t make near that and own a 981 S and a Honda R…Don’t listen to them… you have all your life to make money, don’t go be an old guy in a Porsche.

As for depreciation, the right Porsche with the right options hold value or appreciate, I could easily sell mine for 5-10k more given current market. I sold my s2000 a few years back for 8k more than I bought it with 100k added miles too.

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Just not a fan of convertibles. Plus the Cayman is a bit stiffer and safer (both in a collision and for break ins). YMMV.

@op 170k without bonus. No liability at the moment. There is absolutely nothing that I would love more than buying a Porsche, even if it is not a 911.

But I have finally learnt the hard way that it’s a rich man’s toy. You get this when you are bored with 10+ million in your portfolio.

You have to start building your Roth IRA , Stocks and real estate portfolio. The best lesson I took is instead of buying a $900 iPhone every year, buy equivalent stocks. In 10 years the iPhone would come for free just from the dividends.

It’s a tough one, but invest. You want to build enough passive income to quit. The earlier you start the better. Unfortunately I learnt this recently. My life savings is small and I started stock investment recently (now that it has recovered from the 2020 stock crash).

Systemically invest from every paycheck.

likesmarthelpful

Thanks for the input SA1. It is delusional as nothing is promised. Stocks can go in either direction. I only gave that as an example. I would still recommend to save to have a strong base. Rather than spend on a car which may not hold value.

More power to you, if you have it balanced better.

I am focusing on purely diversifying now, as all my assets are in real estate which doesn’t provide the right liquidity when compared to investment. The dividend aspect is a great way for me to generate liquidity.

As always what works for me won’t be applicable to everyone. I hope you get the spirit of the message and the “not so great of an example” hasn’t soured the discussion.

Lol. These comments are crazy! Poor??… Enslaved??… delusional???… lol. I hope you don’t take some of these harsh comments to heart.

Just buy a used Porsche $35-50k. No one in the Target parking lot will know it’s used. Lol.

likefunnyhelpful

One would ask why do you still have student loans if you are making 135k, I would not buy a car right now, wait until your new salary “beer muscles” die off and focus on eliminating nagging debt or building an emergency fund.

likesmart

I started with 70k in loans and now have 20k remaining. I would also pay off the loans before purchasing. I already have six month emergency fund.

likefunny

Advising someone to buy a car that costs
nearly as much as their post tax income, when they are money poor (net savings of only 15k) is a very financially uneducated advice. You can encourage people to follow their dreams and make dream purchases, once they have achieved financial stability.

For example, if OP takes the $1,100 monthly payment they would put over 6 years (assuming 0% interest for the car) and puts it in ETFs or other stocks, that 80k will turn into 7 figures eventually. And he doesn’t have to wait that long, in 6 years he will have gains that he can put towards the purchase of the car.

likehelpfulsmart

Sooo, there has to be a balance thats struck. There's a very tired and slavish saying that you should work hard now, save your money, and the rewards will be GREAT when you are older.

Problem being, when you are older, you cannot do the things you could do when you are young....so you have all this money but are less able to spend it on what really matters, life experiences.

I recommend saving your money for things that will matter to you in 20+ years, if you think its possible you will still have that Porsche, then go for it.

Personally I would prefer a life experience (like a round the world trip) for that money. But I dont place a high value on belongings, so thats me.

Thanks for putting things into perspective.

But if not now, then when? I have no kids right now and very few financial obligations.

It would be great to get this out of my system before worrying about a mortgage, daycare, 529 plans, etc.

As I said, though, I have to bother justification that it captures my attention every time, and it’s been happening for several years.

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OP in my opinion, do it. Everyone has a hobby...that one thing they splurge on. If you can't finance, do a lease for three years, see how it goes, then walk away. I love cars. Love my sport BMW. I make less than you by quite a bit and easily manage to work it into my budget. Still have cashflow, good health insurance, 401k contribution up to match point. Student loans are less than 10k. And I live on my own with 2k rent. Every time I drive my car literally anywhere, I'm thrilled. Had it for a year and the feeling still hasn't worn off. I spend hours detailing it just cause. I do zero-based budgeting every month and live a modest, controlled lifestyle apart from my car. You can make it work if you want.

The one thing I will say is you can get an absolutely gorgeous Porsche and keep the price tag reasonable. 80k should do it. Porsche is luxury, but it's actually not that expensive to get something nice and sporty. If you start getting unreasonable with the upgrades, you're way overpaying for a car that has stellar performance even at base model. Just remember that. You may drive a simpler Porsche and just think it's a dream. Drive first, then decide how much you're willing to spend on the stuff no one will ever notice.

likefunny

There’s a great tik tok video out there… people who become rich buy assets, people who become poorer buy liabilities. Don’t buy an expensive depreciating car with a negative ROI

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As a car lover, and an advocate of just enjoying your life, I say do it. But at the moment, the used car market is not ideal. Wait a beat. In the meantime work on those student loans and a solid plan to own a Porsche for 2-3 years so when it is time, you’re feeling a little better about it.

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Oh, and also spend that time gathering some good map data so when you do get that Porsche, you know all the places to go to drive it faaaaaasst 🙌🏻

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How much time do you spend in target parking lot for this to be really worth 135k?

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