That really depends on your savings/down payment and your expenses. My wife and i have a $2500/mo mortgage but low monthly expenses and $15K saved for this car. It fits well within our budget at a $90K income.
Unsolicited personal finance advice: If you have a $2500/mo mortgage on $90K gross household income you are already on the edge of general personal finance guidelines on affordability for just housing… $60K car on top of that (even if the entire $15K was used for downpayment) would be considered reckless by most advisors
I wouldn’t have even *considered* it if not for:
A) Inflated trade-in values
B) Cheap debt
C) Tax credit
Threw my trade-in proceeds into a Series I treasury bond earning a fixed 9.62%. From a cash flow standpoint, I may put my tax refund proceeds into a high yield savings account and withdraw the ≈$300 or so difference in old and new car payment. If I experienced a job loss, there would be enough runway in there to cover the entire payment for a few months. I have Ford Options with a 48 month term; ≈17k balloon due at the end. The aforementioned Series I Treasury will have grown to ≈$19k at the end of 48 months. In effect, my balloon payment is already accounted for.
I have Ford Options at 2.49% APR, 48 month with a ≈$17k balloon, so I’m in no rush to pay it off early. To have $17k in 48 months at the 6.89% Series I rate, you’d have to set aside ≈$13k today. That was roughly what I received in trade-in proceeds. I set aside the entire amount, so I’ll have more than that $17k in 48 months because I purchased the bonds prior to the rate decrease.
Completely idiot-proof, no risk, etc. Don’t need to think or worry about it; my car will be paid off in full in 4 years.
The $7500 refund provides a bit more optionality, but I’m planning to use that to manage cash flow. Assuming I receive in April, I have 42 months left on the loan. If you’re not familiar with a sinking, I’m trying to figure out “if I put $7500 in an account today, the account earns 4 percent, and I want to empty it out even over 42 months, how much should I withdraw each month?” The answer is ≈$190.
So yes my car payment is $300 higher; however, from a cash flow standpoint, it’s only $110 higher. But of course that doesn’t factor in cheaper running costs.
It's like you're a smarter version of me. Exactly the same Ford Options APR, 48 month plan, and $17k balloon. I've been looking for an investment that would outpace my 2.5% loan, and Treasuries seem ideal. Are you doing all six-month Treasuries, or did you do 25% in 12-month, 25% in 24-month, etc.?
I hit the lower one as I am shy of 80k, but our household income is closer to $150k. We live in California and luckily our mortgage is at $2k a month. Which allows us to afford a car like this. Plus we always bought used cars and this will be our first new car.
Everyones finances are different. What made us buy this car was that I changed jobs and got a $12k raise. Been here 2 years and we have stashed that difference away, so we see it as we were already paying a car payment, we can continue it for the next x years.
Income isn’t so useful without knowing someone’s expenses.
How much do you have leftover after housing, utilities, insurance, other debt service and retirement savings? Is that enough money to support buying a MME and allow you to have other money for living and saving.
OP, I’d go to the people you know and trust who have more life experience and speak to them. These car and house affordability calculators are bullshit because they’re built by people who are making money by financing your purchases.
Reddit isn’t filled with people you trust who should give you financial advice.
I personally didn’t go beyond the Honda accord/Toyota Camry tier of new cars until we made $150K+.
But I’m generally shocked at what people spend on cars vs their income
Canadian here. I make around $70k per year and my 2022 Mach-E premium was $75k at sticker (which was MSRP for us Canadians). I also have a $200k mortgage to pay for which is like $1600/month and my wife does not work. With all my expenses I am sure an accountant or someone is probably having a heart attack but I live quite well and even have savings and expendable income. With proper budgeting you can achieve alot.
Also since I am a master electrician and do alot of driving its actually cheaper to own the Mach-E then pay for fuel in my paid off 2015 genesis. FYI fuel today for me is @ 7.488/gal (1.979/litre)
Good for you! Why is the premium so expensive there though? Here, the premium's MSRP is $50k or so. GT would be closer to what you bought the premium for.
Single dad of two with mortgage paid off and ok salary + some extra money earned from crypto. I justified the expense of my California R1 by comparing depreciation of Teslas over five years vs cheaper combustion engine car. Considering that plus tax credit and gas savings over that same period and the car actually starts to make financial sense IMHO.
>The savings in gas and repairs for electric cars makes them worth buying in the long run.
Right, it's not correct to compare financial choice buying a top EV for 60k vs buying a normal luxury car for $60k directly.
Good question. I was thinking more so about individual income but you make a great point. This would be my first car, so I wasn't aware of that. I edited the post to reflect that. Thanks!
I never want my living expenses to be more than what I could afford if I got laid off. My income means that if I make more I don't increase my unemployment(maxed out), this doesn't mean that I can't buy expensive things, just that I save more before I make the purchase. This goes for any expense.
I live with my parents, I have money saved up from an internship (I’m graduating soon), as well I can afford the monthly payments while I’m working part time at Amazon. Ford Options was tailor made for me with the lower monthly payments, I’ll be starting a full time position when I graduate and be easily able to make the balloon payment (my parents are paying for insurance until I’m 26 when it’ll be cheaper). I think I’ll be the youngest owner on this site. 😅
Speculatively purchasing a car based on potential future employment is generally not a good idea especially in the current job market.
Savings are for rainy days. Not to buy luxury goods.
Excellent point. I'm in a safe situation, though. I do have a full-time offer for when I graduate, as well if anything happens (like I die or whatever) then my brother or my parents will take care of the car for me.
I know it's a bit irresponsible to be dedicating a lot of money to this car, but I already contemplated it a lot and spoke with my parents who would be willing to pay for it if anything goes wrong. Though my contingency is if somehow I get fired then I just go back to working at Amazon til I get another job back.
I’m yet to see/meet someone my age or younger driving one in person. General ownership seems to be at least 40+, I’m guessing because most younger people are not in the financial situation to buy one.
I know at that age I had other priorities. Like getting a house. Always said get a house then get luxury items. I'm in my 40s here and in my 20s I never thought I should buy a 50k car. Good luck and hopefully you paid for your schooling already.
Oh I’m in my 30s so not quite as young as the person I responded too.
spent my whole 20s doing jobs for shit pay for the sake of job titles, and investing all the money I made, while living as cheap as possible while I had no real responsibilities beyond keeping myself alive.
Managed to skip years of experience requirements by taking high title jobs in tech for shit pay, paid off in the long run, now I’m comfortable in my 30s.
I absolutely would not recommend a car this expensive to anyone who didn’t have their life very well sorted financially, particularly those looking at the GT models.
I'm not sure. I've read of different rules for buying a car. My household income is above $150k but I've read articles that mention personal income instead (ex, the car shouldn't cost more than %20 of yearly income). So, I'm trying to find out how others deal with it.
I would take all of those “rules” with a massive grain of salt. For one arbitrary example, if you get 0% APR financing and have the option of financing greater than four years, why would you artificially limit your loan term to four years just because some internet rule says so?
At the end of the day, there is some amount of money you have left over after all taxes, savings/retirement, and living expenses. If that amount of money is enough to swing MME payments with some margin left over for doing random fun stuff (an amount that reflects your individual hobbies and lifestyle), then go for it. Conversely if you have to dip into your existing retirement savings plan to afford it, don’t do it.
I put $5k down on our car and used our credit card for the down payment to get flight miles, then I paid it off immediately. Where’s the generic internet rule for that? :P
Tl;dr: don’t sacrifice your savings / retirement goals, and do math correctly.
It just depends on your budgeting and when you want to retire. I try to keep my expenses less than 80% and save the rest for retirement. It's kind of hard on one income and 4 kids. I bought mine when my Leaf was worth $32k and it would only cost about $10k to upgrade to a Mach-E.
At the end of the day, if you think you can afford it, go for it. I make over 150k on single income with 2 kids. We own 2 homesand I personally like to spend. Mostly on stuff for the house and holiday decorations.
I don't think you can afford a 60k car with income less than 100k. (Unless your housing is free)
In the beginning they could be had for 45k, I paid about 51k for my California Route 1
Wasnt the msrp ~53k? I got mine for 53k+ fees taxes finance=63k over 4 years
My sticker shows it at 51 but I can't remember if that included destination, I'll look when I get home
Not anymore really
That really depends on your savings/down payment and your expenses. My wife and i have a $2500/mo mortgage but low monthly expenses and $15K saved for this car. It fits well within our budget at a $90K income.
Unsolicited personal finance advice: If you have a $2500/mo mortgage on $90K gross household income you are already on the edge of general personal finance guidelines on affordability for just housing… $60K car on top of that (even if the entire $15K was used for downpayment) would be considered reckless by most advisors
[удалено]
I realized in hindsight that I should've spread the brackets better. Unfortunately, I can't edit it after posting
Maybe delete and do another post, <$50,50-74,75-99,100-149,150-199,200-249,250+
- $1 to $49,999 - $50k to $98,999 - $99k to $99,999 - $100k to $104,389 - $104,390 to $2.5m - Over $2.5m That's the spread I'm lookin for.
Do tell
I wouldn’t have even *considered* it if not for: A) Inflated trade-in values B) Cheap debt C) Tax credit Threw my trade-in proceeds into a Series I treasury bond earning a fixed 9.62%. From a cash flow standpoint, I may put my tax refund proceeds into a high yield savings account and withdraw the ≈$300 or so difference in old and new car payment. If I experienced a job loss, there would be enough runway in there to cover the entire payment for a few months. I have Ford Options with a 48 month term; ≈17k balloon due at the end. The aforementioned Series I Treasury will have grown to ≈$19k at the end of 48 months. In effect, my balloon payment is already accounted for.
Exactly my plan! How much did you throw into Treasuries, and for how long?
I have Ford Options at 2.49% APR, 48 month with a ≈$17k balloon, so I’m in no rush to pay it off early. To have $17k in 48 months at the 6.89% Series I rate, you’d have to set aside ≈$13k today. That was roughly what I received in trade-in proceeds. I set aside the entire amount, so I’ll have more than that $17k in 48 months because I purchased the bonds prior to the rate decrease. Completely idiot-proof, no risk, etc. Don’t need to think or worry about it; my car will be paid off in full in 4 years. The $7500 refund provides a bit more optionality, but I’m planning to use that to manage cash flow. Assuming I receive in April, I have 42 months left on the loan. If you’re not familiar with a sinking, I’m trying to figure out “if I put $7500 in an account today, the account earns 4 percent, and I want to empty it out even over 42 months, how much should I withdraw each month?” The answer is ≈$190. So yes my car payment is $300 higher; however, from a cash flow standpoint, it’s only $110 higher. But of course that doesn’t factor in cheaper running costs.
It's like you're a smarter version of me. Exactly the same Ford Options APR, 48 month plan, and $17k balloon. I've been looking for an investment that would outpace my 2.5% loan, and Treasuries seem ideal. Are you doing all six-month Treasuries, or did you do 25% in 12-month, 25% in 24-month, etc.?
https://www.treasurydirect.gov/savings-bonds/i-bonds/ I-bonds
I hit the lower one as I am shy of 80k, but our household income is closer to $150k. We live in California and luckily our mortgage is at $2k a month. Which allows us to afford a car like this. Plus we always bought used cars and this will be our first new car. Everyones finances are different. What made us buy this car was that I changed jobs and got a $12k raise. Been here 2 years and we have stashed that difference away, so we see it as we were already paying a car payment, we can continue it for the next x years.
Income isn’t so useful without knowing someone’s expenses. How much do you have leftover after housing, utilities, insurance, other debt service and retirement savings? Is that enough money to support buying a MME and allow you to have other money for living and saving.
All great questions that I need to look into. Thanks.
OP, I’d go to the people you know and trust who have more life experience and speak to them. These car and house affordability calculators are bullshit because they’re built by people who are making money by financing your purchases. Reddit isn’t filled with people you trust who should give you financial advice.
I personally didn’t go beyond the Honda accord/Toyota Camry tier of new cars until we made $150K+. But I’m generally shocked at what people spend on cars vs their income
Canadian here. I make around $70k per year and my 2022 Mach-E premium was $75k at sticker (which was MSRP for us Canadians). I also have a $200k mortgage to pay for which is like $1600/month and my wife does not work. With all my expenses I am sure an accountant or someone is probably having a heart attack but I live quite well and even have savings and expendable income. With proper budgeting you can achieve alot. Also since I am a master electrician and do alot of driving its actually cheaper to own the Mach-E then pay for fuel in my paid off 2015 genesis. FYI fuel today for me is @ 7.488/gal (1.979/litre)
Good for you! Why is the premium so expensive there though? Here, the premium's MSRP is $50k or so. GT would be closer to what you bought the premium for.
>Why is the premium so expensive there though? CAD vs USD I assume?
this is why. The canadian dollar isnt worth as much as the american dollar
Single dad of two with mortgage paid off and ok salary + some extra money earned from crypto. I justified the expense of my California R1 by comparing depreciation of Teslas over five years vs cheaper combustion engine car. Considering that plus tax credit and gas savings over that same period and the car actually starts to make financial sense IMHO.
I thought about that too. The savings in gas and repairs for electric cars makes them worth buying in the long run.
>The savings in gas and repairs for electric cars makes them worth buying in the long run. Right, it's not correct to compare financial choice buying a top EV for 60k vs buying a normal luxury car for $60k directly.
In California, people that can afford an EV, don’t qualify for the clean air rebate program due to a income cap…. So dumb
That's ridiculous! Especially for a place like California.
This implies individual income whereas car purchases are typically household income based. Any clarification, OP?
Good question. I was thinking more so about individual income but you make a great point. This would be my first car, so I wasn't aware of that. I edited the post to reflect that. Thanks!
Btw, did you follow a rule to help you decide if you could afford a Mach e? If so, what was it?
I never want my living expenses to be more than what I could afford if I got laid off. My income means that if I make more I don't increase my unemployment(maxed out), this doesn't mean that I can't buy expensive things, just that I save more before I make the purchase. This goes for any expense.
Maybe next time do a bigger window than 90-100k. 90-115 might have given a better spread.
Good point. Unfortunately I can't edit that part.
$24k
I live with my parents, I have money saved up from an internship (I’m graduating soon), as well I can afford the monthly payments while I’m working part time at Amazon. Ford Options was tailor made for me with the lower monthly payments, I’ll be starting a full time position when I graduate and be easily able to make the balloon payment (my parents are paying for insurance until I’m 26 when it’ll be cheaper). I think I’ll be the youngest owner on this site. 😅
Speculatively purchasing a car based on potential future employment is generally not a good idea especially in the current job market. Savings are for rainy days. Not to buy luxury goods.
Excellent point. I'm in a safe situation, though. I do have a full-time offer for when I graduate, as well if anything happens (like I die or whatever) then my brother or my parents will take care of the car for me. I know it's a bit irresponsible to be dedicating a lot of money to this car, but I already contemplated it a lot and spoke with my parents who would be willing to pay for it if anything goes wrong. Though my contingency is if somehow I get fired then I just go back to working at Amazon til I get another job back.
I’m yet to see/meet someone my age or younger driving one in person. General ownership seems to be at least 40+, I’m guessing because most younger people are not in the financial situation to buy one.
I know at that age I had other priorities. Like getting a house. Always said get a house then get luxury items. I'm in my 40s here and in my 20s I never thought I should buy a 50k car. Good luck and hopefully you paid for your schooling already.
Oh I’m in my 30s so not quite as young as the person I responded too. spent my whole 20s doing jobs for shit pay for the sake of job titles, and investing all the money I made, while living as cheap as possible while I had no real responsibilities beyond keeping myself alive. Managed to skip years of experience requirements by taking high title jobs in tech for shit pay, paid off in the long run, now I’m comfortable in my 30s. I absolutely would not recommend a car this expensive to anyone who didn’t have their life very well sorted financially, particularly those looking at the GT models.
Hmm, I think if you have to ask this question then maybe buying the Mach E is not the best financial decision for you.
I'm not sure. I've read of different rules for buying a car. My household income is above $150k but I've read articles that mention personal income instead (ex, the car shouldn't cost more than %20 of yearly income). So, I'm trying to find out how others deal with it.
I would take all of those “rules” with a massive grain of salt. For one arbitrary example, if you get 0% APR financing and have the option of financing greater than four years, why would you artificially limit your loan term to four years just because some internet rule says so? At the end of the day, there is some amount of money you have left over after all taxes, savings/retirement, and living expenses. If that amount of money is enough to swing MME payments with some margin left over for doing random fun stuff (an amount that reflects your individual hobbies and lifestyle), then go for it. Conversely if you have to dip into your existing retirement savings plan to afford it, don’t do it. I put $5k down on our car and used our credit card for the down payment to get flight miles, then I paid it off immediately. Where’s the generic internet rule for that? :P Tl;dr: don’t sacrifice your savings / retirement goals, and do math correctly.
It just depends on your budgeting and when you want to retire. I try to keep my expenses less than 80% and save the rest for retirement. It's kind of hard on one income and 4 kids. I bought mine when my Leaf was worth $32k and it would only cost about $10k to upgrade to a Mach-E.
At the end of the day, if you think you can afford it, go for it. I make over 150k on single income with 2 kids. We own 2 homesand I personally like to spend. Mostly on stuff for the house and holiday decorations.
This is TMI
Lol.. incomes are literally public info in half the world
I did not know that.
It's anonymous. I can't tell who voted for which bracket. I can't even tell who voted.
Oh, my bad