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TOV Forums > General Talk > > Re: What's a "Normal" car payment these days?

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bmw424
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What's a "Normal" car payment these days?    (Score: 1, Normal) 07-08-2004 06:38
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Just curious what you think is a "normal" monthly car payment these days. I know this is a subjective question dependent on disposable income, but the goal is to get a composite picture of what an average car payment is these days.

Here's mine:
Car 1: $300US
Car 2: $234US

anysia
Profile for anysia
Re: What's a "Normal" car payment these days?    (Score: 1, Normal) 07-08-2004 07:46
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his-317
mine-355

cars are little bit of an obsession for me, so my 355 is a little higher than the recommended percentage of my income! it's my "splurge" area!

SOhp101
Profile for SOhp101
Re: What's a "Normal" car payment these days?    (Score: 1, Normal) 07-08-2004 17:45
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My car payments are about $400 USD/month. Some good rules of thumb I've heard is that the cost of your car (the MSRP, or the amount that you haggle to) should only be about 1/2 of your yearly income salary. Also remember that your car payments should last for a maximum of 48 months. If they're any more than that, you're paying way too much interest and you're probably buying a car that's way above your budget.
CivicB18
Profile for CivicB18
Re: What's a "Normal" car payment these days?    (Score: 1, Normal) 07-08-2004 18:38
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00 Lexus GS400 $444.20 / 48 months
03 Acura CL-S $472.28 / 60 months
95 Honda $0

Due to our ever growing family, she is getting a new Odyssey when it debuts, and I will be gettin a 4 door car. Ill probably go for something cheaper. I was considering a TL 6MT and a TSX 6MT but we....ahem, *cough she cough*, thought a Accord EX-L sedan 4cyl 5 speed would be a great car because of the extra room and low price, around 23k here in Kentucky. It makes since since I already have a project car, the imfamous B18C1 powered Civic which will be getting some major changes soon, that is If I dont get into any trouble. Pray for me guys.....

Patrick

civic_cx_92
Profile for civic_cx_92
Re: What's a "Normal" car payment these days?    (Score: 1, Normal) 07-08-2004 19:19
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'04 Accord LX 5MT sedan, $364/mo
'97 Grand Voyager, $0/mo

minivan soon to be replaced by...'05 Odyssey, $400~$450/mo

Portland, Oregon

Would've loved to had a TSX but having two layoffs in two years made us gunshy. My wife is a minivan person, she does not want Pilot nor MDX.

Hawkstrike
Profile for Hawkstrike
Re: What's a "Normal" car payment these days?    (Score: 1, Normal) 07-08-2004 19:35
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04 Accord EX-L: $345
04 Ody EX: $443

TonyEX
Profile for TonyEX
Re: What's a "Normal" car payment these days?    (Score: 1, Normal) 07-09-2004 00:31
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All prices discounted because we order from the factory:

03 Civic Si $320/mo
02 OTR $435/mo
03 RSX-S, lease, cheap
00 NSX Zagato Zanardi Speciale ... eheheehheeh, cheapo too.
74 Dino GTS with new floor mats, paid for
90 Euro CRX SiR with Jackson twin superchargers, paid for
98 ITR with quadruple induction bypass, paid for
02 Jerry Lewis collection, 50/mo on VISA

mditty
Profile for mditty
Re: What's a "Normal" car payment these days?    (Score: 1, Normal) 07-09-2004 02:28
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04 Accord EX-L A/T, free as long as I pay the insurance with a new Honda replacement (of my choice more or less) every 4800 miles.
bmw424
Profile for bmw424
Re: What's a "Normal" car payment these days?    (Score: 1, Normal) 07-09-2004 07:08
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I agree on the 48 month statement. I actually went 36 months on my 03 coupe EXV6 AT ($234) and my 02 Accord SE ($300). I like the rule of thumb for 1/2 your salary. I'd be interested in reading more if you have a source (printed or internet is fine).

bmw424
Profile for bmw424
Re: What's a "Normal" car payment these days?    (Score: 1, Normal) 07-09-2004 07:15
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I was looking at the Pilot as a replacement for the 02 SE (lease) next year, but I'm reading about excessive quality control issues. Still undecided what our replacement vehicle will be.

Understand completely about the layoffs, I suppose that's why I tend to be a bit conservative on the car payments.

bmw424
Profile for bmw424
Re: Additional Information    (Score: 1, Normal) 07-09-2004 07:19
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02 Accord SE - $300US (Lease)
03 Accord Coupe EXV6 AT - $234 (Purchase)


tegx2
Profile for tegx2
Re: What's a "Normal" Car Payment these days?    (Score: 1, Normal) 07-09-2004 08:26
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'03 Civic EX 286/60 months

I think a lot of factors go into determining a "Normal" car payment for each person. For me, I took a longer term at 1.9% and usually pay in excess of 400/month so the car is paid off early. Unless there is a special law somewhere, auto financing is generally a simply interest loan and there is generally no pre-payment penalties when purchasing which allows you to cut your interest simply by paying early. I wanted the lower payment obligations simply because of the volatility of the industry I work in, Consulting. I never want to be overly obligated to monthly payments.

JNorthcut
Profile for JNorthcut
Re: What's a "Normal" car payment these days?    (Score: 1, Normal) 07-09-2004 08:55
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I am getting ready to buy my first new car so I have never made a car payment before in my life. But I plan on spending about $450/month (which is about what I make in a week) for no more than 48 months. I think it is way out of my budget, but my car is going and I WANT MY RSX-S!!!!

So really it is all what you are willing to pay. The more you can put down the better, as that will greatly reduce your payment. I hear the bare minimum you should put down is the cost of the taxes on it - there is nothing worse than letting your taxes gain iterest on you....

Khannie112
Profile for Khannie112
Re: What's a "Normal" car payment these days?    (Score: 1, Normal) 07-09-2004 10:24
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bmw424 wrote:
I agree on the 48 month statement. I actually went 36 months on my 03 coupe EXV6 AT ($234) and my 02 Accord SE ($300). I like the rule of thumb for 1/2 your salary. I'd be interested in reading more if you have a source (printed or internet is fine).



1/2 your salary??? So lets say you make 50Gs a year and after Uncle Sam rams you, you take home 35Gs (30% tax bracket).....you mean to tell me that you would spend
1,450 a month on your cars??? I think the wise choice would be something more like 15-20% of your take home salary. Which would equate to something like 500-600 a month. 1/2 your salary seems wayyyy too high!

Khannie112
Profile for Khannie112
Re: What's a "Normal" car payment these days?    (Score: 1, Normal) 07-09-2004 10:26
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03 EX Accord Coupe Navi 300/month ...I usually pay 400 or more a month to get it over with...contemplating on clearing a portion of my savings and just paying the rest of it off.
Khannie112
Profile for Khannie112
Re: What's a "Normal" car payment these days?    (Score: 1, Normal) 07-09-2004 10:28
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1/2 your salary??? So lets say you make 50Gs a year and after Uncle Sam rams you, you take home 35Gs (30% tax bracket).....you mean to tell me that you would spend
1,450 a month on your cars??? I think the wise choice would be something more like 15-20% of your take home salary. Which would equate to something like 500-600 a month. 1/2 your salary seems wayyyy too high!


Oops, forget that stupid comment, I didn't read clearly and thought it was 1/2 your salary for payments a year, not the whole MSRP of the car...my bad??
bmw424
Profile for bmw424
Re: What's a "Normal" car payment these days?    (Score: 1, Normal) 07-09-2004 11:39
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I agree that it's all about what you are willing to pay. While my wife and I could afford to drive more expensive cars, I can't bring myself to spend that kind of money right now! My interest in starting this thread comes from observing the increasing MSRPs of new models. With these higher prices, payments are sky-rocketing. I just want to get a feel for what everyone is comfortable paying out each month.

Thanks for the feedback so far.

Khannie112
Profile for Khannie112
Re: What's a "Normal" car payment these days?    (Score: 1, Normal) 07-09-2004 11:58
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I agree BMW. As much as you want a nicer, more luxurious car....I have to keep convincing myself that a car is a rapidly depreciating asset and just a mode of transportation. I just graduated college a year ago and have been working, and I wanted a G35 so bad, but I realized I wanted to save up for a house, get my MBA, and do other things and the $12,000 price difference would go a long way.

An old co-worker told me once....every dollar that you spend over $20,000 for a car, is just purely for ego from that point on.

95GSR_99
Profile for 95GSR_99
Re: What's a "Normal" car payment these days?    (Score: 1, Normal) 07-09-2004 12:19
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Khannie112 wrote:
03 EX Accord Coupe Navi 300/month ...I usually pay 400 or more a month to get it over with...contemplating on clearing a portion of my savings and just paying the rest of it off.

Why would you pay your car loan off early?

If you look at an amortization table, you pay 2/3 of your interest in the first 1/2 of your loan term. Assuming you're planning to keep the car longer than the loan term, paying your loan off early only benefits the financial institution who lent you the money. Perhaps you should have taken a shorter loan term and the higher payment that comes with it?

Instead of paying extra money towards your car, consider finding a way to invest the money, whether it is a savings account, IRA, increasing your 401(k) contribution, or putting the money into a CD.

JNorthcut
Profile for JNorthcut
Re: What's a "Normal" car payment these days?    (Score: 1, Normal) 07-09-2004 13:31
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Don't think of your car as an asset, think of it as a liability. All you ever do is put money into it and you never get any money out of it, except for when you sell it for 1/10 of what you paid for it.

I am reading an excellent book that I would recommend to everyone: Rich Dad, Poor Dad

It will explain better than I ever could why both your car and your house aren't really assets but liabilities.

Not trying to preach, just trying to be helpful - my 2 cents.

civic_cx_92
Profile for civic_cx_92
Re: What's a "Normal" car payment these days? OT    (Score: 1, Normal) 07-09-2004 13:44
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I agree with you with cars but house a liability?

condo bought in 1993 for $122K, sold in 2004 for $295K.

I think there's many like me that believe real estate are assets.

JNorthcut wrote:
I am reading an excellent book that I would recommend to everyone: Rich Dad, Poor Dad

It will explain better than I ever could why both your car and your house aren't really assets but liabilities.

Not trying to preach, just trying to be helpful - my 2 cents.



constructicon
Profile for constructicon
Re: What's a "Normal" car payment these days?    (Score: 1, Normal) 07-09-2004 14:20
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JNorthcut wrote:
Don't think of your car as an asset, think of it as a liability. All you ever do is put money into it and you never get any money out of it, except for when you sell it for 1/10 of what you paid for it.

I am reading an excellent book that I would recommend to everyone: Rich Dad, Poor Dad

It will explain better than I ever could why both your car and your house aren't really assets but liabilities.

Not trying to preach, just trying to be helpful - my 2 cents.



I have that book somewhere. I think I'm going to actually read it, and see how that is explained. From everything I've seen, a house is definitely an asset. Hell, my brother-in-law bought a condo 18 months ago for about $103K, and sold it for $135K. I don't think the prices will keep going up like that, but most homes continue to be excellent investments. They usually don't rise meteoricly, but they rarely lose value, too.

JNorthcut
Profile for JNorthcut
Re: What's a "Normal" car payment these days? OT    (Score: 1, Normal) 07-09-2004 14:23
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There are other factors you have to take into consideration, the point he makes is that most people invest in their own home and consider that a good investment when that is not always the case. You have other expenses including your mortgage and upkeep costs than make it cost more than you realize. Now - if you buy a condo for 122k and rent it out to others making say 30k a year on it and then sell it for 295k, that is certainly quite an investment that you have made, because it is generating income for you. True assets add to your income - not your expenses. Usually a house, like a car, only adds to your expenses.

We are getting way off topic here - my apologies.

Read the book, it's good.

HondAddict
Profile for HondAddict
Re: What's a "Normal" car payment these days?    (Score: 1, Normal) 07-09-2004 14:23
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My friend is also reading this book and fed me the same line about cars and houses being a liability. I could see the car, but real estate, especially in today's market, is a definate asset. I know someone who bought a town house in 99 for $195,000 and today it's worth more than $325,000. Anything that appreciates $130,000 in 5 years is an asset in my book. Just out of curiosity, what does the author of this book consider an asset?
JNorthcut
Profile for JNorthcut
Re: off topic =(    (Score: 1, Normal) 07-09-2004 14:56
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I am not saying real estate is not a good investment, it certainly is. But you shouldn't think of your own home as your greatest asset. It isn't easy to up and sell your house any time you see fit. Do not confuse your own home with other real estate assets, your home has expenses, other assets typically do not. My post earlier:

http://www.vtec.net/forums/one-message?message%5fid=251195

I say these things as if I know what I am talking about - I just read a book, I live in an apartment, and probably won't buy my first home for at least another 2 years. But, what this guy is saying really made sense to me, and when my mom sold her home for a measly $15K more than what she bought it for over 20 years ago I started to understand even better.

This isn't the word of God, just something to consider before you invest too much in your own home. How much is reading a book going to hurt you anyway? It takes less than a week to finish.

anysia
Profile for anysia
Re: What's a "Normal" car payment these days?    (Score: 1, Normal) 07-09-2004 18:56
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hmm, i should mention i did 60 mos on my first civic at 335/mo and 42 mos on the second civic at 385/mo. i've always paid more than what was due.

this time i opted for 60 mos again because it didn't tack on much extra interest over the life of the loan compared to 48 months and it made my payments lower, but i can still pay extra when i want, but in this job market if my job goes "bye bye" i can better afford the lower payments of the 60 mos term.

tegx2
Profile for tegx2
Re: What's a "Normal" car payment these days?    (Score: 1, Normal) 07-09-2004 20:26
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You are correct in pointing out that 2/3 of the interest is paid at the beginning of the loan term in amortization table. While this is true it only makes since because interest payments are figured on the principal amount of the loan financed, which is at it's highest rate at the beginning of the loan term. By paying off your loan early, you will save money on the total amount of interest. Some individuals, I for one, like to be committed to a lower loan payment in a volatile job market.

Secondly, I agree with finding ways to invest money. It's an important balancing act on how much money an individual puts toward paying off debt vs. putting the money in an investment activity. If you look at how much money is saved by pre-paying loans, this sum may total more than the money made off of an investment.

Hence, when an individual has high interest rate debt and suddenly comes into some extra money...that individual will need to decide how to best use the money. Will they save more interest from paying off the high interest debt, or will they make more from investments? Like what is a "normal" car payment, everything is an individual decision.

carcrazy84
Profile for carcrazy84
Re: What's a "Normal" car payment these days?    (Score: 1, Normal) 07-09-2004 21:21
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Does anyone actually own their cars around here? Man, so many of you guys buy these new cars that you cant afford, and end up having payments on them. Why throw out cash like that?
anysia
Profile for anysia
Re: What's a "Normal" car payment these days?    (Score: 1, Normal) 07-09-2004 22:52
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what's the difference between paying for it upfront and spreading it out over however many months? granted the higher the interest rate, the more you're paying, but when you're talking 1.9, 2.9, 3.9%, it really doesn't add up to much over the life of the loan.

here's a scenario for ya to think about. if i didn't have a car payment, i know i wouldn't be able to sit here and save that chunk of money each month to put towards a car. mainly because i'd be driving some old clunker around that i could buy for $1000 or $2000 and i'd have so many repairs to keep up with just to keep the car running for my 70+ mile per day commute....

personally, i've never felt that i couldn't afford my car payments. i don't know if that holds true for everyone around here or not. but for me, my car pmt is what works for me and the amount of time i've speard those payments over is what works the "best" for me.

i'm pretty darn particular about my finances. i have no cc debt. i have student loans, my car, and my mortgage. that's it.

JNorthcut
Profile for JNorthcut
Re: What's a "Normal" car payment these days?    (Score: 1, Normal) 07-12-2004 09:03
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Also, in the grand sceme of things, if you are going to pay 20-30K for a car what is an extra 1-2K for the luxury of being able to have it for 4 or 5 years while you are still paying for it??? An extra 5% or so on the cost of the car isn't that big of a deal, especially if you can talk the dealer down on the price.

 
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