Your income to cars' worth ratio?

[javacontour]

Originally Posted By: Bror Jace

A probable better analysis would NOT include purchase price but instead factor in all costs associated with keeping said car on the road: depreciation (the biggest for owners of any late-model car), insurance, fuel, other maintenance & repairs, etc ...

Of course, most people would have a hard time correctly calculating this unless you led them through it step by step.


Then there is me, who has the data in my PDA phone,

I think purchase price/or depreciation is valid. I figure purchase price and then give the account credit if I sell the vehicle, get an insurance settlement, etc.

After all, until I either spend the money, or get it back, it's a cost of ownership. So I don't play any games, if I spend the money, it goes into the data. If I sell the car and get money, it goes into the data.

Depreciation is theoretical, until you actually sell or trade the car.

 

[Panzerman]

I dont understand how you can come with this ratio, because a car depreciates so fast. there are so many factors to deal with, one being how long you keep the car. Lets say you make $75,000 a year and buy a truck for $30,000 but keep it for a minimum of 10 years, your income to car ratio would be high, but really it would be the same as a person that would buy a car for 15,000 and trade every 5 years. A better question is what ratio of your income should be for a car payment. what you are trying to do is put a car into the same category as a house, even though they are getting as expensive as houses, they are a bad investment compared to a house. Anything with a deed makes you money, anything with a title loses you money. Thats the way i feel about it.

 

[Steve S]

Cars /trucks are a waste of money .I spend the least amount possible to do the job I need done. A car/truck as a status symbol doesn't work for me . All I think is the people can get a loan. That being said some people hae a passion about cars .I had a neighbor who loved Vettes and would wear them out driving as he used it as his daily transportation. "he could afford the vette though.

 

[crw]

Yeah, I mean, how many of you are actually owning the car? If you're leasing a $50K vehicle, how does that count? If you're in the first year of 72 months of payments, I don't know how that can count either.

Someone told me this once, and I think it has value as a policy to live by... "If you can't pay for a car in three years, you can't afford it." Now, some of you are going to ramp that up to say, "if you can't pay cash for it, then you can't afford it." That's fine. But I don't think you can reasonably go more than three years, as a good rule of thumb and to keep from getting behind on things.

My challenge is just getting my kids through their teenage years..........

 

[biomed_eng_2000]

Let's say my cars can sell today for about $20k total. They are paid off. I plan to keep them for 20 years and give them to charity or the junk yard after the 20 yrs service. Let's assume zero worth after 20 yrs service.

So that is $20k/20yrs = $1k /yr

Let's say my salary is $100k/yr

So my ratio would be "income to car payment ratio" would be 100:1

 

[kartracer55]

Going off kbb with my mileage and condition im at .9, however when you consider that I had the car signed over to me, after the repairs Im at 3.4. [censored]

 

[XJ1100]

There are a lot of factors and variable to include...but I will just give you what you asked for. I am going by what I paid for the car.

Current income (college student) ratio=16.25
When I start working full time in May: ratio=66.25

I like to drive my cars for as little as possible per mile. This accounts for purchase price (and depreciation), basic maintenance, insurance, and repairs. I have been buying reliable cars for less than $1000 and driving them into the ground. For me it is just an appliance... motorcycles are a completely different story.

 

[JTK]

I was a ~6.2 yesterday. Today I'm a ~2.4.

Joel

 

[Brien]

My ratio is 260 to 1. Two hundred and sixty. I bought te car from a family member. LOL.

 

[Bror Jace]

"I was a ~6.2 yesterday. Today I'm a ~2.4."

OK JTK, what did you buy?

When I got a job working for $6.74 per hour, I bought my '95 Civic that cost more than my annual salary ... so I was less than a 1 (by original calculation). However, I had savings ... and I kept the car 7.5 years.

 

[JTK]

Originally Posted By: Bror Jace
"I was a ~6.2 yesterday. Today I'm a ~2.4."

OK JTK, what did you buy?


I unloaded our 2001 Windstar for a 2008 Honda Odyssey 3yr lease. In reality, I should 'adjust' my ratio. I'm 'only' obligated for ~$10K worth of the Ody. That throws my ratio back up to a whopping 4!

Joel

 

[sprintman]

I earn't $195k last year but got retrenched (laid off). This year with new company will be tough. Bloody third time I've been retrenched and I'm sick of it. I'm 55 years of age with a nine year which makes it tough

 

[rjundi]

My ratio is currently 6 however I owe nothing on them.

I own a 04 WRX & 05 Subaru Legacy GT wagon.

Just prior to buying these cars our ratio was 52 owning a pair of 200k mile Honda Civic's.

 

[SevenBizzos]

Well, we own 3 cars so the ratio is a bit skewed. I'd like to think paying cash for your cars and/or not making payments on them is better than worrying about their values.

Ratio is < 5

 

[Benzadmiral]

If we go by what my Buick is worth (I think), then 2.8.

If we go by what I owe on it, which is quite a bit less, then 4.

 

[Al]

Income is really immaterial if you are at the end of your working career or retired. But having said that as a practical matter the less you put into cars the better.

If you enjoy cars as a non transportation thing and its a hobby (and can easily afford it) its again not an issue.

Captain Obvious signing off.

 

[M1Accord]

Originally Posted By: JTK
Originally Posted By: Bror Jace
"I was a ~6.2 yesterday. Today I'm a ~2.4."

OK JTK, what did you buy?


I unloaded our 2001 Windstar for a 2008 Honda Odyssey 3yr lease. In reality, I should 'adjust' my ratio. I'm 'only' obligated for ~$10K worth of the Ody. That throws my ratio back up to a whopping 4!

Leasing is not buying. Sorry amigo.
Joel

 

[2002 Maxima SE]

I'm at 8. My wife and I bought new cars 5 and 7 years ago (respectively) and both are paid off. I'm getting the itch...but trying to get past it until 2010 or later.

 

[Audi Junkie]

Another way to roughly calculate is to say, hey, my car costs $2000 or $3000 a year because I'll keep it for X. If you do it right, having a nice car w/o huge costs is possible.

 

[Steve S]

Originally Posted By: 2002 Maxima SE
I'm at 8. My wife and I bought new cars 5 and 7 years ago (respectively) and both are paid off. I'm getting the itch...but trying to get past it until 2010 or later.
Keep that hard earned $$$