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Am I crazy for wanting to lease a top-of-the-line 3-series out of college?

Discussion in 'Fine Living, Home, Design & Auto' started by GreenFrog, Jun 20, 2011.

  1. GreenFrog

    GreenFrog Senior member

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    Your monthly expenses(by which I mean bills that have to be paid every month) should never exceed 50% of what you bring home. I would aim for %25. This gives you alot of free money to go skiiing, enjoy a cruise, invest in other business ideas.

    If you live like this you will be surprised just how fast things will grow. I still have my day job. Only because I make alot of contacts and it keeps me form getting bored. But it's only about 1/5th of what I make. Rest comes from investments I have been able to make because I had the money ready to make that investment.

    Don't do like I did and fuck yourself up right at the start. Took me over 10 years to sort myself out.


    What investments do you have? I ideally want to invest in real estate and maybe get some cash flow as a landlord.. or maybe flip some properties.
     
  2. HRoi

    HRoi Senior member

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    I find it amusing that the OP is getting killed for considering a lease payment that is around the going SF rate of a pair of Lobbs or EG. Whats the difference between "blowing" your hard earned cash on either passion?
     
  3. tj100

    tj100 Senior member

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    Whats the difference between "blowing" your hard earned cash on either passion?

    Huge. The car is a recurring monthly commitment that requires additional expenditure (insurance, parking, gas, maintenance) to get any enjoyment out of. Aside from a jar of Saphir here or there, my Lobbs don't need anything more.

    Dude hasn't even started his job yet - what if he hates it, or is terrible at it, and leaves in two months? Do you really want to be saddled with a big lease payment with so much uncertainty in the near future?
     
  4. ezlau

    ezlau Senior member

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    ... why would you insinuate that I hate autos because they suck? I know the merits of dual clutch transmissions and when did I ever imply I could outshift an F1 driver?

    I hate automatics because they take away from the driving experience. Manuals are more fun.

    [​IMG]


    I totally agree regarding the fun of manual vs auto. I have never driven or owned a Miata so I can't say too much about it, but they seem pretty small and compact. And if you're a tall guy it's gonna suck. Also, I'm guessing it probably doesnt too much of a trunk space either.

    All aside from the negatives, Miata seems to be a really popular car used in auto-x along with the e36 M3 and I bet it is a fun car. Let's just hope you're not 7 feet tall or something [​IMG]
     
  5. GreenFrog

    GreenFrog Senior member

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    I totally agree regarding the fun of manual vs auto. I have never driven or owned a Miata so I can't say too much about it, but they seem pretty small and compact. And if you're a tall guy it's gonna suck. Also, I'm guessing it probably doesnt too much of a trunk space either.

    All aside from the negatives, Miata seems to be a really popular car used in auto-x along with the e36 M3 and I bet it is a fun car. Let's just hope you're not 7 feet tall or something [​IMG]


    I'm 6'1" so I'm a bit tall, but not too tall. The miata definitely does look tiny.. maybe i'll go back to looking at some m3s lol. Jumping all over the place.
     
  6. A Y

    A Y Senior member

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    The Miata (especially the 1st gen.) has a lot of things going for it:

    - RWD
    - really fun, predictable handling
    - no nannies of any sort except ABS
    - hands down, the best shifter of any car
    - really low insurance rates
    - cheap and easy to maintain
    - really light, and great gas economy

    The only possible downside is that you're too big to fit in it, so test drive one. I've ridden in one for a 100+ mile trip, and it's comfortable enough.

    If you get one, just refresh its mechanicals (suspension bits mostly), and enjoy it as it is. No need to mod it out. Get a 2nd set of wheels with snow tires, and you're set. Its appeal is its simplicity --- don't f#ck it up with extraneous stuff.

    If you wanted something that's a bit bigger, can carry a bit more, and will be a bit more livable in winter, look at the RX-8. It's totally underappreciated, almost as much so as the E36 M3. The car is also very capable in stock form. It has pretty bad gas mileage, though.

    --Andre
     
  7. ezlau

    ezlau Senior member

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    e36 sedan m3 are perfect imo. seats 4-5 people, 240 horsepower stock, and decent gas mileage. FWIW, my professor who is shorter than me, prolly like 5'7" has a miata and he looks awkward driving it =/ 6'1" might be pushing it lol. Like what A Y said, definitely test drive one before. Doesn't hurt to find a couple e36 m3 to kick the tires around too either and possibly test drive them.
     
  8. eqpablon

    eqpablon Senior member

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    Username79 is right on a lot of points. Username, check out the "Cars We Drive!" thread. A majority of them do drive beat up Japenese imports. A lot of their daily outfits cost more than their car, so naturally they value spending their money on clothing over cars. If this were an automotive forum, say www.bimmerfest.com, and I started a thread about building a professional wardrobe now that I just got a job out of college making ~ $75K/yr; they would rip me to shreds for spending over $150 for any article of clothing. Car forumites normally don't understand, or have a passion for clothing; but they do have immense enthusiam for BMW's. If they saw this thread they would probably suggest the OP do an ED on a Z435is (3 years 15k miles for about 350/mo). In a similar manner people here question anyone who would lease a car period. Generally they are correct, but they don't have the passion that the bimmerfest guys have about cars. The way the bimmerfesters don't understand what a goodyear welt means, or what constitutes soft tailoring; is pretty comparable to the average SFer not understanding subvented leases. OP, you are in your early 20's. I'm assuming you've never purchased/leased a car in your name. I'm also assuming you don't have much of a credit history either. Your credit score may be fine, but more often than not car dealers look at your vehicle credit history more than anything else. Odds are BMW wouldn't lease a vehicle to you w/o a cosigner or a hefty downpayment; and downpayments nullify the advantages of leasing. Get a loan on a cheap beater, pay the loan off. Build your credit, build your job history, buy a house (assuming the rent/buy calculation comes out in favor of BUY), then get your BMW [​IMG]
     
  9. bigbjorn

    bigbjorn Senior member

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    Real car enthusiasts don't lease BMWs. They drive an F250 to haul their car to the track.
     
  10. tj100

    tj100 Senior member

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    Your credit score may be fine, but more often than not car dealers look at your vehicle credit history more than anything else. Odds are BMW wouldn't lease a vehicle to you w/o a cosigner or a hefty downpayment; and downpayments nullify the advantages of leasing.

    This is a good point. When I bought the 911, I wanted to finance it because PCNA was running a really good deal (like 0.5% financing), but all the lenders declined my loan b/c I had never had a car loan before. It seemed very odd to be penalized for having saved and paid cash for cars in the past, but that's apparently the way it works. So I paid cash.
     
  11. Journeyman

    Journeyman Senior member

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    I know that some people praise leasing but - in my humble opinion - there's little point in leasing unless you can claim a tax advantage from doing so (ie you are using the car for your business and thus can claim leasing costs as a tax deduction).

    Otherwise, you will be paying $7200 per year to rent a car, plus thousands more in other costs.

    Again, this is just my opinion, but unless you can claim car expenses as a tax deduction, it's much better to buy a second-hand car so that someone else has already taken the initial depreciation hit. Sure, the car will continue to devalue, but will generally do so more slowly after the first few years and if you need to sell it, you will be able to do so as it will be an asset (albeit a depreciating one), whereas as a leased car is always and only a liability.

    I know that some people think that it's a "hairdresser's car", but I bought an MX-5 (Mazda Miata) 15 years back and it has always received very positive reactions. It is light, with beautiful balance and handling, cheap to run, very reliable, and it looks great.
     
  12. tj100

    tj100 Senior member

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    I know that some people praise leasing but - in my humble opinion - there's little point in leasing unless you can claim a tax advantage from doing so (ie you are using the car for your business and thus can claim leasing costs as a tax deduction).

    Otherwise, you will be paying $7200 per year to rent a car, plus thousands more in other costs.

    Again, this is just my opinion, but unless you can claim car expenses as a tax deduction, it's much better to buy a second-hand car so that someone else has already taken the initial depreciation hit. Sure, the car will continue to devalue, but will generally do so more slowly after the first few years and if you need to sell it, you will be able to do so as it will be an asset (albeit a depreciating one), whereas as a leased car is always and only a liability.

    I know that some people think that it's a "hairdresser's car", but I bought an MX-5 (Mazda Miata) 15 years back and it has always received very positive reactions. It is light, with beautiful balance and handling, cheap to run, very reliable, and it looks great.


    Agreed. I think cars coming off leases tend to be good deals to buy. Somebody else basically took the depreciation hit for you, and you end up with a two year old car in pretty good shape.

    I understand why leases make sense for some people. Some people have a car allowance as part of their job, and those are usually leased. Some people really want a brand new car every two years, and for them, the economics of leasing probably tends to work out.

    Otherwise, buy something a couple of years old with low miles on it and drive it into the ground.
     
  13. GreenFrog

    GreenFrog Senior member

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    hmm.. I do have excellent credit (for a 22-yo) since I've used a credit card for the past four years and paid it off every single month. last time i checked it was around 750+.

    does the 'we don't want to lease to you because you have no history' mainly apply to higher-end/expensive cars? i dont see a honda dealership saying that if i were to ask for a civic lease.
     
  14. tj100

    tj100 Senior member

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    hmm.. I do have excellent credit (for a 22-yo) since I've used a credit card for the past four years and paid it off every single month. last time i checked it was around 750+.

    does the 'we don't want to lease to you because you have no history' mainly apply to higher-end/expensive cars? i dont see a honda dealership saying that if i were to ask for a civic lease.


    I don't know about the lease situation because I've never tried it. But I got turned down on a loan for the 911 when I was 28, with 10 years of perfect credit card history (paid off every month), income in the high $100's, three years of mortgage payments (on a modest mortgage), plenty of savings, and a credit score in the mid-700s. And this was 2007 - probably the loosest lending environment in the history of credit.

    The only reason (they say) it was turned down was because I had never had an auto term loan. I'm really not sure how it impacts the leasing side of the business, but I wouldn't just assume because your credit is good, you won't have a problem.
     
  15. norcaltransplant

    norcaltransplant Senior member

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    Just to calculate the numbers using Paycheck City: For Mass: Assuming a biweekly paycheck: Bi-weekly Gross Pay $2,884.62 Federal Withholding $516.35 Social Security $121.15 Medicare $41.83 Massachusetts $144.25 NetPay $2,061.04x2= $4122.08 This does assume any contributions to a 401k or IRA
     
  16. UnFacconable

    UnFacconable Senior member

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    There is so much bad advice in this thread, I hope GF is taking everything with a grain of salt. I'm disappointed Pio hasn't shown up to debunk the leasing misstatements. Generally I'm in agreement with username79's line of reasoning in this thread. I don't want to hand out advice here because I don't have much to add at this point and it seems GF has changed his tune but I would point out that to me the most salient information was that GF wasn't going to be driving the car much. Leasing a car makes a lot more sense when you're relatively close to the number of miles you are paying for - it sucks to pay for 10k a year and only drive 3k. I do want to point out a couple of things to the advice givers who seem to be missing the point and should probably reconsider their admonitions: 1. No maintenance costs on a BMW the first 4 years - therefore none over the course of a lease. Similarly - gas will be roughly the same for t he BMW as most other cars. We're not talking huge dollars here, particularly since GF said he won't be driving on a daily basis. 2. Lots of people (myself included) would hesitate to own a BMW outside of the warranty period because maintenance can quickly add up. Just look at the BMW horror stories thread. You could get a used BMW that's screwed together great and only requires minimum maintenance, or you could be like everyone I know with a BMW that routinely spends large sums for things that are "never supposed to break." 3. Why do people think leasing is so bad? $590 for a month for that car is a pretty good deal - and he'd only be on the hook for 27 months. I don't know if that 590 includes an amortized down payment or if that assumes you're putting $$ down as well - GF really need to tell us the whole story to get a sense as to what you were planning. 4. Everyone who was arguing based on the retail price of the car being high should be disregarded. The purchase price by and large doesn't matter to GF - only the amount he's paying to rent the car for 27 months. 5. To the guy who said he would aim to save 75% of his take home - for GF that would mean limiting spending to around $1k a month (see norcaltransplant's analysis above). How is $1k in Boston a reasonable goal? Even $2k a month. If GF could save $1k a month at this point, that would be great. Maybe you were pissing in the wind and saying that people who make 300k can easily live on 25-50% of their take home, I don't know - but clearly it doesn't apply to someone making 75k in Boston. 6. GF will have plenty of friends blowing $600 a month on drugs, booze, food, clothes, etc. If he forgoes all of that for a car, more power to him. If he wants to have it all, obviously finances will be tight with the car. Everyone has to make their own decisions. 7. Without calling anyone out in particular - if you are reading this thread and don't understand how tax withholding works, please make sure you have a good accountant, and read this: http://www.consumerismcommentary.com...-on-bonus-pay/
     
  17. GreenFrog

    GreenFrog Senior member

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    ^^ Thanks.

    As per #3, the $590 is the cost to lease for 27 months and includes the tax in it as well. The downfall is that I was a complete dumbass who went in to the dealership without researching how to negotiate lease payments (because I wasn't planning on leasing a car anyway; only went in to test-drive some cars and fell in love), so I ended up with the $590 with a $8K downpayment, which is laughably ridiculous lol. I'm not 100% sure, but I think with 0 down and the multiple security deposit trick, the real lease price would be around $700ish per month. Of course, over a 27 month period, that's still less out of my pocket compared to the $590 + $8K down.

    Psychologically, though, I think it's not smart to spend $700 on a car alone. My rent would be around that price and that just seems wrong. Also, my insurance would be around $200 a month, and gas should be around $100-150. So at least $1,000 a month on a car that's not completely necessary is just irresponsible. I want to do it with all my heart, but I think after the first month or two, I'd come to hate the monthly payments.

    I'm still debating as to whether I should buy a cheap, used car for less than $10K, or if I should lease a cheaper car that would cost me $350 a month. Maybe I'll just lease the 2012 civic. My friend is leasing one for $169 a month which is pretty cheap. It's a solid car too with great gas mileage. I'd hope to get it in a manual if possible (doubtful).
     
  18. Prince

    Prince Senior member

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    I find it amusing that the OP is getting killed for considering a lease payment that is around the going SF rate of a pair of Lobbs or EG. Whats the difference between "blowing" your hard earned cash on either passion?

    IMO, because owning > leasing. OP is getting a nice starting salary. When he receives his first paycheck, he can go to the store and get a pair of Lobbs and own them. They are within his budget. The 335i is clearly not. He just can't afford the car right now, without having to opt for leasing. I doubt anyone on this board would vote against getting a 335i for 60k and pay for it right away.
     
  19. UnFacconable

    UnFacconable Senior member

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    Ahh, didn't see the 8k in your OP but thought someone else mentioned it. That's equiv to an extra 3 hundo a month in payments, so you'd be looking at close to 900 a month which is a different ballpark altogether.

    If you currently have an old A4 why not just stick with that for the next year and see how you feel once you have a bit more cushion?

    Whatever you do, make sure you figure out what will actually make you happy, as best you can, and don't base it on advice that doesn't apply to you. It's no more wasteful to spend $6k a year on a car than it is on wardrobe or partying, but only you will know what will make the most sense for you.

    I love cars, but don't drive much and live in a city so I've stuck with an SUV for the past dozen years that gets it done for me when I need it. Every time I think about getting a new car, which is often, I realize that in a number of circumstances I would still prefer my SUV and that it would be foolish to make a change given my current lifestyle. YMMV, etc.

    EDIT: Prince - I don't agree with you, and I am confident many others out there (calling Piobaire) would agree with me. Leasing is just another way of financing a vehicle, and I don't see the prize in "owning" a car. Many do not want to own a quickly depreciating asset which potentially has ever increasing maintenance requirements. Personally, I would only lease a German near-luxury vehicle because I would not want to own one outside the warranty period. People would have jumped all over GF is he said he was going to use 100% of his savings to outright purchase the car in cash. Moreover, if your salary increases significantly year to year (some do, some don't - pretty sure consultants get decent raises), then leasing may be a better option even for people who do want to "own" their car, because it means that in 3 years when their salary is say 30% higher and they have more savings built up, they can pay the residual and purchase the car at the end of lease. There is no shame in leasing.
     
  20. Prince

    Prince Senior member

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    In a similar manner people here question anyone who would lease a car period. Generally they are correct, but they don't have the passion that the bimmerfest guys have about cars. The way the bimmerfesters don't understand what a goodyear welt means, or what constitutes soft tailoring; is pretty comparable to the average SFer not understanding subvented leases.

    I lurk religiously at B-fest and Bimmerforums and the majority there drive E36's, E46's, E34's and E39's. There is not really a pro-lease attitude on those boards. I like the respect the old cars get over there.
     

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