How much to spend on a new car for new grad

Microsoft Nbcndjks
Oct 10, 2018 22 Comments

I’m graduating from my Masters program soon and moving to the Bay Area. I really want to get a nice new car as a gift for myself...I’m mainly looking for a nice SUV.

I’m really tempted to spend 50k on a car but I also feel that it’d be too much money wasted on a depreciating product.

Offer: 120k base, 350k RSU, 100k Sign-on @Google

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TOP 22 Comments
  • Qualcomm
    Kimjeller

    Qualcomm

    PRE
    Qualcomm, AMD
    Kimjellermore
    You Indian or what? Lol. I had some Indian friends before who splurged on their first car. I still have my 8k car from grad school. If you have a family, sure get a Pilot or highlander or odyssey. Otherwise, stick to low cost low maintenance car. You can buy Mercedes but make sure you’re ready to pay 600$ or an oil change or something. Haha
    Oct 10, 2018 1
    • Facebook
      ppaadd

      Facebook

      PRE
      Oracle
      ppaaddmore
      Dude, why do you think op is Indian? I can point to pretty much every race for people who buy more car than they can afford.
      Oct 10, 2018
  • Facebook wiiwkziakh
    whoa how'd u negotiate your rsu
    Oct 10, 2018 0
  • Uber Ggh43
    350k rsu for new grad is awesome!
    Oct 10, 2018 1
    • Apple / Eng cho Chang
      Ya how did u negotiate OP?
      Oct 10, 2018
  • Get a nice CPO car. Don’t spend $50k, maybe $25k. If you want to give a gift to yourself, keep the $25k in savings for when the market starts to rebound so you can make $$$. Or keep $5k of that for a baller solo vacation to somewhere in 6 months.
    Oct 10, 2018 0
  • Pinterest shoppin
    Get a nice used SUV. You'll get it 10-20% cheaper than new even if it's only 1-2 years old.
    Oct 10, 2018 0
  • Cisco / IT vzIq77
    How much debt do you have right now? If any, pay that first, then splurge on the $50k car since your sign on bonus alone will cover it.
    Oct 10, 2018 0
  • Apple eurp31
    Buy a used dealer car with 18-25k miles on it. Buy it with cash if possible. No sense in financing a depreciating asset that goes from 30k down to 10k in 4 years. The average car payment in the US is $506. It’s a colossal waste of your income when that income could be going towards a college fund, 401k or mutual/index fund.
    Oct 10, 2018 5
    • TI / Product IOlOl0
      Why pay with cash if it’s 30k? A loan still makes sense so you can invest the cash now
      Oct 10, 2018
    • Apple eurp31
      For starters, there’s no interest you’re paying. You tend to not upsell yourself into luxury options you don’t need like you do with financing since your cash price is fixed. And even after buying the car you have the $500 extra per month to dollar invest cost average into the market. At the end of depreciation period your car is worth the same, you didn’t give money to the bank, and your new investments bear the market fluctuations better than a lump investment at T0.
      Oct 10, 2018
    • TI / Product IOlOl0
      I’m only asking because the interest rate on the loan I got was 1.79%. If I take out a 30k Loan at that interest rate, I can turn around and immediately invest that 30k and likely be able to get a better return than 1.79%. Even today the interest rate for a new car is around 2.8%... still not very hard to beat investing that money. You don’t have to do lump investment at T0 you can still dollar avg invest over time. Not all loans/interest is bad imo
      Oct 10, 2018
    • Apple eurp31
      If you don’t do a lump payment at T0, then why are you paying interest to the bank for no upshot?

      Either way most people save and invest gradually in order to buy with cash, so they can go right back to saving and investing the same way.

      People can get low interest auto loans. But that’s far from the national average interest rate people pay.
      Oct 10, 2018
    • TI / Product IOlOl0
      Just go to a credit union, loan helps build credit too... my parents raised me to do lump sums and buy cash for a car which is why I put down an 18k down payment on mine but it’s not a bad idea if the interest rate is decently low and it can help build your credit (my credit is now 830+)
      Oct 10, 2018
  • TI / Product IOlOl0
    I spent 48k on a car after working one year and had MS and my only regret is I didn’t spend 55k to get all the bells and whistles on my Audi (I’m 25 now). Took out a 3 year loan at 1.79% at the time so I also regret putting down 18k cash instead of getting a larger loan. 10/10 would do again, financially you’re only responsible for yourself right now (assuming you don’t have a family) and can choose what you do. At the end of the day you’ll make back that money.

    If you’re looking at German luxury cars see if they have courtesy vehicles for sale which they provide to people when they get their car serviced. My car had 5500 miles and I got it for 20% off msrp and also got it as certified preowned so warranty was 6 year/100k miles instead of 4 year/50k miles.
    Oct 10, 2018 2
    • Facebook
      ppaadd

      Facebook

      PRE
      Oracle
      ppaaddmore
      $48k for something that was worth a whole lot less 1 year later? Good job, man.
      Oct 10, 2018
    • TI / Product IOlOl0
      Yeah it’s worth 28-30k now. MSRP on the car was 56k. People have different priorities what they spend their money on
      Oct 10, 2018
  • This comment was deleted by original commenter.

    • Microsoft Nbcndjks
      OP
      No, 6’4 guy :/
      Oct 10, 2018
  • Dropbox jnhB37
    Why would you buy a SUV?
    By the way most new grads I know had at least one minor car accident. One guy totaled his on the first day. I would not recommend an expensive car.
    Oct 10, 2018 0
  • Facebook pcuyqbn
    Rent a Ferrari for a weekend. Have a bunch of fun for <1k. Then buy a used Honda Civic.
    Oct 10, 2018 0
  • Oracle vrooom
    As little as you can!
    Oct 10, 2018 0
  • Microsoft 4655434b
    At least 120k...
    Oct 10, 2018 0