The biggest thing I see people get in trouble with is with that is they don't take into account property tax and insurance.  So they get the sports car they think they can afford until their insurance bill comes in.  I saw a 10 year old roughly 350z cost 330 dollars in insurance alone. 

not gonna lie, i'll probably end up doing the same at some point(Dodge Charger would probably be what causes it)

Eh it depends on what else they have to pay/buy.

Personally Im in the mindset that just because you can get approved for something in the $40,000-$50,000 range that you can afford it...

For me at least though I'm in a spot where I think I'd largely be fine leasing a new car and maybe even buying it at the end of the lease as long as it wasn't more than like $30,000 new, I hope with whatever job I end up with I'm able to pull in at least $30,000/yr. Which I dunno if I worked full time at AT&T but then being a part time student would mean I'd have very little time left in my day to do much and I dunno if I want that which is why maybe being okay with working part time and being a part time student would be an option.

I feel like we're all picking on this one example... but anyway here's another thing to add to the train.

I can't really agree with the statement that "if you have to get a loan to buy a car, you can't afford it." Taking it at face value, it doesn't seem to look at the whole picture. When you look at any major financial decision, you have to look at the entire picture, both short and long term.

In my case, when I decided to buy a new car, I set a couple of requirements

• Car must be under $20K out the door (so realistically speaking the car itself costing $18K was the max limit)
• I must take the shortest term loan possible since longer terms mean I pay more in interest.

I didn't have $20K in the bank at the time, I had $15K. So obviously I shouldn't even be considering this when I don't have enough liquid cash to cover the loan should I need to at a moments notice right? Well, let's look at what the parameters are here:

• The interest rate through my creditor is like 2.5%. This isn't a whole lot when compared to inflation which the most common average I hear is 2%. At the moment, inflation right now is beating my interest rate, meaning that the creditor is losing value off my loan.
• The loan term is 3.5 years.
• The monthly payments were well within my budget. i.e., I still could have a comfortable surplus at the end of the month.
• I have a job that I was comfortable in and for the most part looked stable for the entirety of the loan.
• I was going to run this car to the ground anyway. So the valuation of the car means almost nothing to me.
• I was looking at makes and models with good maintenance reviews.
• I was looking at specific cars with great history reports

All of the parameters were in my favor in my ability to pay off the car without issues for the entirety of the loan, even after the inevitable insurance hike (because newer car and loan term requires more options).

I have had my current car for 2.5 years and I haven't experienced any financial trouble with it. It's at a point now where I can simply pay off the rest of the loan and be done with it. But I won't. Why? Because opportunity cost. Instead of dumping off the rest of the loan, which as far as I know isn't really hurting me after accounting for inflation, I can use the money to put into something else that can grow.

Okay, so I'm pretty sure after reading all of this some of you are rolling your eyes going "well yah, you have financial stability" but the point is, financial advice entirely depends on the situation you're in. I came from basically well below the poverty line 10+ years ago to where I am now by being smart with how I spend my money and working hard to earn what I can. The people who drive themselves to financial ruin are those who only see the short term gains without thinking about the longer term consequences or fail to account for other things.

if you use a loan to buy a car, you dont own the car. the bank does. that is the difference. You are maintaining a vehicle which you dont own. 

@M.YurizakiYou get a decent amount of it, but the depreciation affects you whether or not you decide to sell the car until it's only worth scrap. If you lose your job and can't afford to keep the car or you need to sell it to buy a cheaper car, then you've lost more money. You seem to have a grasp on finances and probably have a few thousand in emergency savings though.

I just about broke down crying watching a guy writhe his way into financial ruin, trying to penny-pinch monthly payments on a car. He was making minimum wage, had 40K in medical debt, and was trying to put down money on a car that wasn't that special. You could honestly get a better used car than a lot of the cheap stuff Chevy sells new. I wanted to tell him to just walk away and buy a 1k car that he could just run into the ground, but he wanted to live a life of "luxury" he couldn't afford. A lot of people think car payments are a way of life and they're inevitable. But you're dumping money every month into a depreciating asset. It makes zero sense to finance a car unless it provides you some sort of credit boost in 99% of situations.

@STRMfrmXMN One could argue buying a car outright is just dumping money into an depreciating thing, the only difference is  you're not paying interest on it. But assuming you get a 2.5% rate (which I guess it depends on your credit rating) for a 3.5 year loan, you're paying ~$1550 extra, or ~10% more, or $37/mo more if you like to break it down that way. I'm also at a point in my loan that the car's value is much higher than the loan's remaining principle. So if I had to sell it now, I could pay off the loan and have extra.

But again it's really about opportunity costs and what you do with the money you "saved." I rent an apartment (with other people), so I must be throwing my money away right? Well if I played the money I didn't spend on mortgage payments correctly, I could be making that rent back per month and then some. And I read in some cases that putting 20% down on house to avoid PMI may not actually be the best course of action as far as building your assets go. Because again, the difference between how much you didn't spend on the down payment, even with PMI, could go to something that could outgrow your total value than if you'd just put the 20% down. On top of that, you still own the house and you're still building equity on it.

But I get you. Some people don't have control over what they should spend their money on and think that their possessions mean something. Their possessions own them, not the other way around.

Oh damn that's fucking crazy yeah those priorities are... Questionable.
I'd say before leasing or financing anything, car or house. Your source of income better be substantial and be careful of your debt/income ratio.

I'm pondering what that would look like for me in my situation going to college part time and maybe working part time at AT&T or possibly full time and what that ratio would change to with a lease over something a few years older and a few thousand cheaper if I can even get approved for a lease if lessors prefer you to be older than like 19. I also want to keep my expense/debt ratio to income ratio as low as possible so I can save up to have some money to get a house in 2020 or 2021 when I'm 20 or 21 years old.

Cars are probably tough things to justify buying brand new, leases for a new car makes more sense because if you like it then you're basically buying a used car but the upside is that you also know what you're getting because you've had it for a few years, and if you don't like it. Well then you're not tied down to it for as long although on the flip I can see how that'd be a bad thing.

For me, Im looking at a price difference of almost $10,000 from what I'd be interested in if financed although insurance is a big factor here. I would like a 2011-2015 Dodge Charger with a V6 (SXT trim or lower) or I would like a new Jeep Compass Altitude with a lot of the packages just to snipe some insurance discounts.

I could suffice with a Chevy Cruze or a Honda Accord but god they're so boring but I can see some of the financial benefits for going boring but damn when it comes to cars I sorta want it to have it around for at least 10 years and not look too dated.

I feel like I should add these are considerations Im making before I do anything, I have yet to apply for AT&T although I feel confident. I also have yet to apply for a community college.

@pinksnowbirdiePlease don't finance a Chrysler car you can't afford, especially a Dodge if you don't want to be buried in the collection of r/askcarsales "This guy wants a car he can't afford and bought, you guessed it, a Dodge." Chrysler financial is pretty skeevy and if you can't get financed through them then any CDJR dealer will have surely experienced that type of customer many times and will refer you to Santander, who doesn't even requite POI.

Don't finance a car at 19. YOU CANNOT AFFORD TO GO INTO DEBT YOU DON'T EVEN LIVE ON YOUR OWN YET. If you lose your job tomorrow you are fucked. There is no way around it.

You can live with a Miata if you want a cheap, fun car that's easy to maintain and not an arm and a leg to insure. 

Also Honda Accords are very much not boring cars. I've driven many. They handle better than most other cars and have instantaneous steering and throttle response with good feel, even in the newer electrically-assisted steering and pedal system. Look into something like a 2006/07 Accord. I promise you that is a much better buy in your situation than a newer car that will depreciate faster and will deteriorate like a Chrysler car. You're in a position in life where you have to drastically outweigh the "needs" vs "wants" in a car. I drive a 25-year old Camry. I accumulate money, have no debt, and plan to keep things that way unless something happens to my job. I will graduate debt-free because I went to community college. When I get a good job in IT, within a couple of years I could buy a nice used Ford Mustang or the like because I'll be debt-free and likely won't need to live in a house. Heck, I could keep my 1993 Camry until it dies (and it won't die soon, that thing is bulletproof).

Edit: sum wurds

Honda Civic and Toyota Corolla best cheap reliable cars ever.  

@STRMfrmXMN next year I'll be 19 lol

Eh it's something I'm looking at

Fuck no to the miata lmao

get the RX8 then, horrible first car(horrible as in expensive to maintain and needs a ton of preventative maintenance) but a great car(great as in fun to drive)

nah lol I just consider the Cruze or 2010-2013 Accord again.

@themaniac i summon @DimasRMDO to the fray

get a civic(non type r to make you even more a ricer) and become a ricer

@pinksnowbirdiethose cars are too new. Also the Cruze isn't that reliable. Again, I work for Chevy  The old Cruze's transmissions break (even though the car is nicer to drive IMO) and the new ones have issues with piston rings. A 2010 Accord will probably hold it's resale value too well for you to afford it. If you need a loan then you don't own the car and you can't afford it. Just trying to talk you out of buying a car that you can't afford to own. You not only would have to make a monthly payment on it, but you have no emergency funds (I assume) and you also have to maintain and insure the car.

@STRMfrmXMN but nah I dont have plans to buy anything yet, as I said I turn 19 next year. Or rather in 5 months I turn 19, and I'm gonna be flying a fair bit to Alabama next year.

I would love to buy a car next year as well however that may not be in the cards right away.

Frankly though if my financial situation allows for it I'd like to go for a more want basis if not, I can wait until I move.

As far as a lease goes, well for a FCA product doesn't that work out better then?
Otherwise buying an FCA product, a $20,000 Dodge Charger should be fine although insurance would suck.

I wouldnt do anything until I had $5,000 to put towards something. I know you can argue that I could just buy a $5,000 car but how much am I going to end up paying in maintenance? $5,000 cars in Minnesota are fucking horrid. Often a lot of rust and/or questionable maintenance history. It's honestly not something I want to deal with, I get there's plenty of old and robust cars out there but they seem to be few and far between.

ah lol

Good to know about those reliability issues with the Cruze, suppose my mom dodged a bit of a bullet when she was considering getting out of her loan with her Kia

I know if I finance a car I don't own it until it's paid off. That's literally what the title lien is and if you dont pay they take the car back.

I've never been fired or lost my job outside of me quitting so I don't want to knock on wood here but I'd say that's not a huge concern when I do get back to work.

The reason she was considering getting out of her loan is that it wasn't building credit for her.

@pinksnowbirdieNever lease a car unless you're well-off and are leasing luxury cars. That's the only situation it makes sense to lease a car: owning a luxury cars becomes a maintenance nightmare, especially if it's German, after three years, so dump the lease and roll into a new Mercedes/Audi/etc every three years because you make 100K a year and it's not a huge issue for you. Remember that if you lease a car then you do not own the car. It's not even a matter of not owning the car because someone owns it due to your debt, you LITERALLY do not own the car. The car is not registered in your state to your name. You do not have that as an asset to your name. A Dodge Charger is not a reliable car all things considered.

Literally the first ad for a Toyota/Lexus car with 4WD I found in Minnesota was for this Lexus. This would do great, it's safe, it's easy enough to repair and some parts are shared with Toyota so they're abundant and cheap, very reliable machine, 6K.

https://minneapolis.craigslist.org/dak/cto/d/2002-lexus-rx-300-rx300/6670377496.html

Just grab a dumby ez pz car like old 2004 or 2003 civic. Literally anything Japanese will last forever provided the previous owner took care of the car. Old Lexus save for V8 versions are bulletproof. 

@STRMfrmXMN how many miles are on your camry? I'd imagine around 300k or more since its 25 years old, curious as to how bulletproof one can be when maintained properly(which I assume it is)

Here's an ad for it right now on Craigslist. You were only off by a little bit!

https://portland.craigslist.org/clc/cto/d/1993-camry-with-79k-original/6674929001.html

damn only 80k for being 25years old, it sure has not been driven a lot