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Old 09-10-2012, 09:25 AM
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LukeS LukeS is offline
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Originally Posted by Stealth.Pilot View Post
I think 10% of pre tax income is an absurdly high amount of money to spend on a car. Remember this is pre tax so if you look at it as percent of disposable income it is a lot more. Especially when you also net out mortgage payments, children's school fees, wife/girlfriend, etc.

I would advise spending no more than 2-3% of income on a car. Better to save and retire early. Driving a nice car is great, but not if it means working till old age. I'd rather retire by 50 than drive Bentleys and Ferraris.
That's great and I agree, the lower the better. However, most Americans don't make enough to practically stay within that boundary, even with a beater car. Then on the flipside, a lot of people who can and should practice some type of discipline don't and the banks follow suit because itís profitable. I only used that number as a point of reference, but I think 10% would be a stretch goal for most American families, whether its circumstance or self-inflicted. I try (and still trying ) to instill delayed gratification and accountability into my children, but looking back at my youth, I guess Iím being somewhat hypocritical.
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