Getting a new car after graduation

[Shadow Conception]

Hello again guys. Back in the day, I really sucked at coding. Still, I found that stuff fascinating and eventually got decent enough at it to score a pretty sweet software internship that translated into an awesome job offer for post-graduation. So, for anybody out there that's still in high school and doubting his/her ability in an intro to programming class, keep trucking.

I graduate in May. I'll be living close to DC (probably Clarendon) and commuting to Herndon. My offer's starting me at a salary in the low nineties with a quarter grand signing bonus. I want to take out a loan to buy a 435i M-sport.

The nagging voice in my head tells me that it's probably not the best decision. I'd throw a ton of money into a depreciating asset, money that I could ideally throw somewhere else for much better returns.

But honestly, my spreadsheet of different anticipated bills tells me that I'll be able to afford the monthly payments (including a wild guesstimate for insurance cost) with the take-home income. I'd predict that I'd still be able to save around a grand a month after the bills are paid and the fun funds are accounted for.

Pros: The M3 has always been my dream car, since probably middle school, but I can settle for this car until some more pay bumps later on down the line. I don't have any practical need for a fancy ass car, but nobody does. This is the shiny new toy that I've always wanted that will make my commute more interesting and my weekends more fun.

Cons: I'm throwing away eight hundred bucks at car that will depreciate in value for five years.

Should I go for it?

 

[xSkyDrAx]

I'd say lease it for 3 years or so unless you really plan to keep it for a long time. As long as you're not tanking your financials with this I'd say go for it. You're only young for so long before you get burdened down with more bills and makes things like that harder to justify. If you can swing it and still have the rest of your finances in order then no reason not to though maybe give it a few months and make sure your job prospects are stable.

 

[boomerang]

Why guess at insurance cost? Call around and find out. If you're happy with that number I wholeheartedly second the lease. I prefer 24 months if I can get them. Pay for your use, forget about it depreciating because at the end, you just give it back. While you're driving it, you've got a full warranty covering anything that may go awry. On that car you will want to ask what you're going to have to pay for "required maintenance". Hopefully it's nothing but if there is a cost, you will need to factor that in on a 36 month lease. It may not factor in with a 24 month lease. I have no direct knowledge of what if any maintenance you'd have to pay for but go in with your eyes wide open by asking.

 

[Carson Dyle]

Start saving money beginning with your first paycheck. Make it a habit. No, make it a mission. You'll be glad you did, and not just in 35-45 years, when you retire. You'll be glad when you want to buy a house, or when you want to get married, or have kids, or you decide that the rat race isn't for you and you want to move to Alaska and become a fishing guide.

You're going to have one hell of a lot on your mind, as well as on your budget, when you begin your job. The job itself, commuting, finding a new apartment, furnishing it. New toys should be the last thing you're worrying about right now.

 

[MustISO]

My suggestion is to avoid the impulse to spend your money and save it. It's great that you got a good paying job right out of school but at some point you'll have a family and probably want a house. Learning how to save for the future will come in handy. It's certainly not for everyone but it's a discipline I've followed since I started working at 15.

 

[Jumpem]

At that salary, and near Washington DC, you should be looking in the Honda Fit price range.

And I hope that $1k per month of saving is after already putting 10% into a 401k. I would rather drive an affordable car and save another $500+ per month.

 

[pcgeek11]

I know you are all excited for your new job, But IF you were a smart dude you would wait and see how the job works out for you and your employer BEFORE you commit that much money on anything.

Why you ask. You may Hate that job and want to move on. The employer may Hate you and want you to move along... You never know.

Better to wait a bit and make sure it works out first.

 

[dbk]

Clarendon eh? You're gonna be spending so much money going out all the time. Been there done that.

 

[manimal]

Get a E30. Learn how to love it and wrench it and if BMW is really your thing step up to a e46 or lease a 3 series for a few years till you get your savings in order.


If you have never driven a e30 now is your chance. With your budget you can leave some cash for some mods and really have a raspy DD that turns better than most porsches.

 

[olds]

At that salary, and near Washington DC, you should be looking in the Honda Fit price range.

And I hope that $1k per month of saving is after already putting 10% into a 401k. I would rather drive an affordable car and save another $500+ per month.

This

 

[Yuriman]

Lots of surprisingly reasonable advice here.

Retirement isn't 35-40 years away if you start putting your pennies away now. I'll take extra years of leisure over a more expensive car.

 

[Tuanies]

If you want a reasonable thrill, Ford Fiesta ST or Focus ST. Save yourself $20k and put it towards retirement, savings or a house like everyone else mentioned.

 

[repoman0]

I'm your age and make around what you do .. $800 is a huge car payment, imo. I hardly want to take on the $430 payment for my new to me 05 M3, and additionally that'll only depreciate around another ~$10+k if I put another 100k-150k miles on it and maintain it well, and is cheaper to insure than a brand new car.

I get that fun cars are awesome (or I wouldn't be buying a 10 year old M3) but you can do it for much cheaper. Think about saving money in addition to travel ($$$) and other fun things in life.

 

[Fenixgoon]

you'll get awfully tired of 800/mo in a car payment. mine was 345/mo and that was annoying enough.

why not look at a lightly used 335i coupe? will save you $$$

and wait and see how your job works out. plus the DC metro area is notoriously expensive.

 

[Brinson]

Where are you moving to DC from?

90k in DC is like 60k almost anywhere else. 90k seems like alot of money, but look at living expenses in DC. You should, at the very least, wait until you've lived there a few months to see how much money you really need to live comfortably. You might be surprised at how much money you really need to live.

 

[BlitzPuppet]

Sounds a bit pretentious if you ask me, especially if you are straight out of college.

Give it a few years and save up some money rather than throwing $800 a month away on a car payment.

 

[Dr. Detroit]

Hows the traffic?

I'm sure you will be able to go 0-30mph quite a bit in the horrendous DC/VA/MD traffic -

You should be placing a minimum of $10K in your 401K.

Plan accordingly or do all of us savers a favor and fuel the economy with your consumption!

 

[michal1980]

what is a quarter grand? $250?

I wont say don't get a new car. But I'd wait a few months to figure everything out. See if you like the job, how the job is going, how you like where you are living etc etc.

 

[AznAnarchy99]

I know you are all excited for your new job, But IF you were a smart dude you would wait and see how the job works out for you and your employer BEFORE you commit that much money on anything.

Why you ask. You may Hate that job and want to move on. The employer may Hate you and want you to move along... You never know.

Better to wait a bit and make sure it works out first.

100% this.

I got a new job too and could afford a car right away. I waited a few months first to make sure that I was going to stay here for a while.

Second, lease it. Also BMW has a graduation incentive that basically gives you $1000 free.

 

[Tweak155]

what is a quarter grand? $250?

I wont say don't get a new car. But I'd wait a few months to figure everything out. See if you like the job, how the job is going, how you like where you are living etc etc.

Lol I was wondering the same thing.

But you guys seem to be missing the fact he's been interning here for a while. I think he probably has a decent idea about the place and job.

 

[pcgeek11]

Lol I was wondering the same thing.

But you guys seem to be missing the fact he's been interning here for a while. I think he probably has a decent idea about the place and job.

He didn't say how long... Internship is one thing actually being an employee can be quite another.

Waiting a bit is good sound advice considering the cost of the area, the cost of the car and insurance etc. He really doesn't know what his living expenses will be. Patience is a virtue.

 

[Shadow Conception]

Yes, I didn't mean a quarter grand. Take it two orders of magnitude higher, and that's what I meant. I was hoping to put a down payment of about ten grand. I get another somewhat similar bonus the following year as well. Makes sense that you can't take the money and run, though, which is why they'll require me to stick around at a year if I want to keep the bonus without paying it back to them.

I think I'm going to keep driving my dad's car and see how the finances play out before making a decision. Northern Virginia is quite expensive. Funny that I thought I'd save a shit ton of money by choosing not to work in the SF offices.

The internship was in Seattle, but I've lived in Northern VA before college. Still, I've never been financially independent around here. Waiting a little sounds best.

 

[AznAnarchy99]

Yes, I didn't mean a quarter grand. Take it two orders of magnitude higher, and that's what I meant. I was hoping to put a down payment of about ten grand. I get another somewhat similar bonus the following year as well. Makes sense that you can't take the money and run, though, which is why they'll require me to stick around at a year if I want to keep the bonus without paying it back to them.

I think I'm going to keep driving my dad's car and see how the finances play out before making a decision. Northern Virginia is quite expensive. Funny that I thought I'd save a shit ton of money by choosing not to work in the SF offices.

The internship was in Seattle, but I've lived in Northern VA before college. Still, I've never been financially independent around here. Waiting a little sounds best.

Yup. When you're ready, go here and read up so you don't get screwed.

http://www.bimmerfest.com/forums/forumdisplay.php?f=20

They also have some sponsored salesmen on there that can definitely help you out. I ended up buying my car from one of the salesman on that forum.

 

[pcgeek11]

Yes, I didn't mean a quarter grand. Take it two orders of magnitude higher, and that's what I meant. I was hoping to put a down payment of about ten grand. I get another somewhat similar bonus the following year as well. Makes sense that you can't take the money and run, though, which is why they'll require me to stick around at a year if I want to keep the bonus without paying it back to them.

I think I'm going to keep driving my dad's car and see how the finances play out before making a decision. Northern Virginia is quite expensive. Funny that I thought I'd save a shit ton of money by choosing not to work in the SF offices.

The internship was in Seattle, but I've lived in Northern VA before college. Still, I've never been financially independent around here. Waiting a little sounds best.

It is always better to wait when uncertainties are present. Good call.

The office near DC may be quite a bit different than the office you interned at in Seattle.

 

[michal1980]

Yes, I didn't mean a quarter grand. Take it two orders of magnitude higher, and that's what I meant. I was hoping to put a down payment of about ten grand. I get another somewhat similar bonus the following year as well. Makes sense that you can't take the money and run, though, which is why they'll require me to stick around at a year if I want to keep the bonus without paying it back to them.

I think I'm going to keep driving my dad's car and see how the finances play out before making a decision. Northern Virginia is quite expensive. Funny that I thought I'd save a shit ton of money by choosing not to work in the SF offices.

The internship was in Seattle, but I've lived in Northern VA before college. Still, I've never been financially independent around here. Waiting a little sounds best.

+1

I think you'll lean a lot about how life will play out there. I would pay attention to how much you drive. If your end goal is a new BMW... sometimes leasing a BMW makes more sense then buying. But you need a good idea of mileage. Heck if you want an M4, and think its a realistic goal. Drive a beater for a two years and put that 800 bucks a month into a car savings fund, boom you just saved the difference between a 435 and M4.

Or if you don't need the space in two years time the M2 should be out and save you a few bucks

Do a euro delivery on it, will give you a vacation, and save money