How much do you have to make year/salary to own NSX?

[akira3d]

I agree that there are too many variables to consider before making such a general statement.

I certainly wouldn't have thought I'd be able to buy an NSX-T new based on my current annual salary alone, but I did so over a year ago and have not once felt "car poor."

There are a ton of factors which helped make my purchase possible. I didn't buy a car before the NSX...I was perfectly happy driving hand-me-downs (two Celicas) for more than a decade. During that time, I got a job and saved most of my income (I don't go out to eat much, nor do I drink...doing both can add up fast). I got married and my wife started working, accelerating our savings. I was able to put 20% down on a townhome just three years out of college...and the property has appreciated nicely. Thanks to company perks, I saved on electronics (which is good, since I'm a tech-junkie).

And, even when considering all of these factors, I wouldn't have bought my NSX new if it wasn't for my bonuses!

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--akira3D
'00 Acura NSX-T (red/black), '97 Honda Civic HX (black), '01 Lexus IS300 (black/black)
"Reality is better than the dream..."

akira3d.com/nsx

 

[lemansnsx]

Originally posted by Larry:
My wifes first words when I told her I was buying an NSX were "but it's not a practical car". My response was "huh ??"

Had to laugh when I read this! I first heard those words from my Mom when I was 18 and bought my first mid-engine sports car! I'm still hearing the same words only now they come from a different female...

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Andrew Henderson
The NSX Model List Page

"We have long acknowledged that enthusiasm for things automotive is a sure
sign of emotional instability if not outright dementia" - Brock Yates

 

[NSXForEver]

Originally posted by DeHaldaswerth:

However, at least for me, buying a cool car has never been a rational decision; it ranks just under food and right above shelter on my needs list. I can't imagine being a dyed-in-the wool car guy and waiting until I was sixty so that I could "afford" the object of my desire.

Well said.

Obtaining an NSX has been a goal of mine for several years. When I got frustrated at school or work a few years ago, I would look at a picture of an NSX. It was great motivation. A bit silly, perhaps, but it worked. Now I have a great wife, a nice house, a job I love (I'm a software engineer, by the way), and, of course, an NSX.

If I described in detail what I did to obtain my late model NSX, most of you would reply with a lecture on financial management. I didn't save up for a huge down payment or drive an old car for 10 years so that I could justify the purchase.

The bottom line is, I have been making the payments comfortably for 7 months now without any trouble (including 100 per month in insurance) and I have no regrets.

Back to the subject...I have an average salary - probably lower than the average NSX owner. It's by no means in the 6 figure range (though it might get there soon if things go well at work next year

).

As others have said, buying an early model NSX is a reachable goal for many.

Matt

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2000 NSX-T #49
Silverstone/Black
9000 miles
No Mods

 

[rcarlos]

If you spend all your money on an NSX and have little money for other things I believe you are "house poor".

 

[DocL]

I'm able to affford my NSX by selling the gold that I save from the teeth that I extract.

 

[nicholas421]

Originally posted by Ag NSX:

So if you make $100k, and live within your salary range expenses, you could "comfortably" probably afford a $50k car.
B]

if you have a $50k car while only making $100k then you are not living "within your salary range [budget]"

 

[Nsxotic]

Agreed! 100k is not nearly enough to afford a 50k car......

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Todd Arnold

http://www.geocities.com/nsxcessive/index.html

 

[Ag NSX]

"if you have a $50k car while only making $100k then you are not living "within your salary range [budget]"

Nicholas, I have to disagree with this statement, but I'm just wondering what you think the budget car price would be. A $50k car on 5 yr. payments with no money down would be around $875/month.

(I'm making very very broad assumptions on tax, health insurance and 401k contributions here)

Making $100k would net you around $5400/month. So you would have $4525 to spend on mortgage and living expenses.

Just out of curiosity, what do you think a $100k income can afford in a mortgage? I'd say a $250,000 mortgage.

 

[Nsxotic]

WOW! I think that you are quite a bit off on this one, Kenric. 100k is only 8,300/month, Of 8,300 with 401k (15% = ~$1250), a little medical ($150), soc. sec.($407 and maxes @ $4984/yr), medicare tax, state income tax (~$750-$1300) if it applies to your state, federal income tax (~$1,900-2,100),..........will leave you with about $3,700-$4000. A 100k job will be very difficult to pay an ~22-2300 mtg. payment (PITI) and an ~$8-900 car payment if you still want to eat and clothe yourself. The other bills like ins, phone, electric, cable, cellular, blah blah blah... will add up to the remaining 800-1000 that you have left and you still haven't eaten! A 200k mtg and a 35k car would be pushin' it nevermind a 250k house and 50k car........

Sorry to disagree with you Kenric, I usually see things your way.

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Todd Arnold

http://www.geocities.com/nsxcessive/index.html

[This message has been edited by Nsxotic (edited 14 December 2001).]

 

[nsxxtreme]

I really hope you guys are joking around. Either that or all that schooling didn't do you any good. I don't even make half of what you mentioned, and I drive a $40000 car. I pay $250 a month.

 

[Nsxotic]

No we're not joking around at all and if you have a 250 payment on a 40k car, then you put down 26-30k! You only financed somewhwere around 10-12k for 60 mos, I'd imagine. AND if that's the case, then you are the BIG exception. If you make less than 50k, then I have no idea where you came up with 30k to put down.... someone must have helped you out somewhere along the way. 250 a month is a KIA payment, not an NSX payment.

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Todd Arnold

http://www.geocities.com/nsxcessive/index.html

 

[nsxxtreme]

No one helped me ever!! You right I did put around $30k down. I moved up though my cars. The only car I ever lost money on is the integra I bought before my first NSX. I bought it (the Integra) brand new for $20k sold it three years later for $16k. This is my second nsx. My first one I made $8k on. I plan on owning this car for a year then sell it close to what I bought it for, therefore I get to own the car and the only thing I actually pay is the interest. I always wonder how you people can make so much money, but always complain about not being able to afford anything. I also own a 98 CBR 900 (paid cash) 98 Toyota Tacoma still owe $3000. and two jet ski's. I am also still in college!! I don't mean to put anyone down. Its just that I read all these messages about how much it takes to own a NSX. For those out there that are not rich, I am letting you know you don't need to be. Just be smart with your money.

[This message has been edited by nsxxtreme (edited 14 December 2001).]

 

[Nsxotic]

Stop. You are defying math. Enough with the smoke.

 

[nsxxtreme]

Would you like vin #'s?

 

[Slingshot]

Originally posted by Dr.Lane:
I'm able to affford my NSX by selling the gold that I save from the teeth that I extract.

 

[johndoh]

I see buying & owning cars as a luxury "expense". I've never bought my cars as a financial investment. I have never gained money nor come close to braking-even when selling my cars. Most money I've lost selling a car was a Ford (but that's another story)

If you factor in gas, insurance and other misc things you spend on your cars, I guess I have a hard time believing that owning cars is profitable.

Scenerio 1(assuming most people finance their cars): On a $40k car w/ 20% down($8k) and 8% interest: your payments would be around $650/mo for 5 years with a total payment of ~$39k. Add $500/yr of gas and $1500/year on insurance, you've just spent ~$57,000 in 5 years. If you sold your car after 5 years at 50% value of the original purchase price, you're still underwater by $37k.

Scenerio 2(assuming you paid cash): On a $40k car, you keep for 2 years and sell. Assuming your car depreciates at 5%/yr, your car is worth $36,100 - $4000(gas & insurance) = $32,100. In order to break even, you'd have to sell your car after 2 years for $44k. Oh, and you can't forget the taxes you have to pay the state when buying cars.

I'm not that good with math and I wrote this up pretty quick so let me know if there's fault in my numbers and/or reasonings.

 

[Nsxotic]

Exactly the right way to factor car costs but you definitely need to remember the taxes.

Especially on 40k considering that that is $2400 alone at 6%. Not an investment at all and 100k earner should drive a 30k car at a max to uphold a reasonable yearly cost of ownership. DTI should be factored using net income $$ so a DTI of 20-25% for just the car payment is WAY out of whack. (ex. $8-900 payment with $4k net income.)

I guess to answer the original question........... you should take your lowest possible monthly net income, multiply by 15%(max) and this is your monthly payment. From this, try to make this a 48 mo. payment (ok to actually finance for 60 but use 48-54 to determine the amount financed as this will allow for unexpected car care/extras by lowering your possible amount financed) after your cash down. Knowns.... TERM for calculation (48-54), RATE (shop it and realize age of car, term,credit,equity,income,residence,etc. will all factor into rate), and PAYMENT (figured above). Plug 'em in to solve for the unknown (AMOUNT FINANCED). Back the taxes, tag, fees and cash down out of the amount financed number and that's your max selling price. Does this math = an NSX? If so, what year? What condition? So, now I ask you, ' how much do YOU have to earn to afford an NSX?

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Todd Arnold

http://www.geocities.com/nsxcessive/index.html

 

[nsxxtreme]

You can't avoid paying for gas on any car you buy. You can't avoid paying for insurance on any car you buy. So this is the cost of owning any car. I realize some cars are better on gas and some are cheaper to insure. But, I pay more fore my Toyota than I do the NSX. My point is I could own a Pinto and still have to pay these bills, so I really don't consider it a cost of owning a NSX.

The good thing about living in Oregon is that there is no sales tax. To register my NSX for two years it cost me I think between $30-$60. I think of everything I buy as an investment. I have noticed that people that make a lot of money don't really try to get a good deal on things they buy. I work with people that make $100k-200k a year. When we start talking about cars and how much we have paid, I'm amased at how may just go in and pay sticker.

Buy low sell high how do you think car lots make money.

One last thing, How much do you think people put it to those supped up Integras,preludes and even civics. I am sure you would be surprised to find out that their cars cost just about as much as yours. I am not talking about the ones with coffee cans for mufflers

[This message has been edited by nsxxtreme (edited 15 December 2001).]

 

[Nsxotic]

Originally posted by nsxxtreme:

Buy low sell high how do you think car lots make money.

Hmmmm????? I'll have to think about this one.

------------------
Todd Arnold

http://www.geocities.com/nsxcessive/index.html

 

[Ag NSX]

"WOW! I think that you are quite a bit off on this one, Kenric. 100k is only 8,300/month, Of 8,300 with 401k (15% = ~$1250), a little medical ($150), soc. sec.($407 and maxes @ $4984/yr), medicare tax, state income tax (~$750-$1300) if it applies to your state, federal income tax (~$1,900-2,100),..........will leave you with about $3,700-$4000. A 100k job will be very difficult to pay an ~22-2300 mtg. payment (PITI) and an ~$8-900 car payment if you still want to eat and clothe yourself. The other bills like ins, phone, electric, cable, cellular, blah blah blah... will add up to the remaining 800-1000 that you have left and you still haven't eaten! A 200k mtg and a 35k car would be pushin' it nevermind a 250k house and 50k car........"

NSXOTIC, going with your numbers your take home pay is less than 50% of your gross pay, that seems low to me.

If I were making 100k, this is how cash flow would look. I take home about 60% of my salary. I'm also single so health insurance is alot cheaper. Using 60%, monthly take home would be $5000. As for the mortgage, a $250k mortgage (7%) would be $1660/month, say taxes are $420/mo and insurance is $40/mo, that would equal $2120/mo. Personally I spend about $450/mo (cell,cable,gas,electric,phone,internet,car insurance). So with this scenario - $5000 - $2120 - $450 = $2430. For food and entertainment & toys. I usually budget $1000/mo for this. This would leave me with $1430.

I don't know how our numbers are so far off. Maybe things are just more expensive in Florida.

 

[nsxxtreme]

AG NSX,
With this formula you will retire a very poor old man. Where is your 401k? I'm not sure what someone that makes 100k a year pays in taxes, but it would not surprise me if they are paying 50% tax.

The more you make the less you make.

Everyone has different ideas of what to do with their money.

I think the real question here is what are you willing to do for an NSX? If the answer is anything then you will get one.

[This message has been edited by nsxxtreme (edited 16 December 2001).]

 

[Nsxotic]

Kenric, the big difference that I see is the insurance!!!!!!!!! In Florida, after Andrew, insurance is pretty high. I pay 2,100/yr for my homeowners' ins. Much more than 40/mo. Anyway, the other issue is how to take home 5k out of 8k. I don't. Taxes and 401 make sure of that. Taxes on 100k are 28-31% (nowhere near 50%, nsxxtreme). At 200k, you pay 38% and take home less than 8k after 401 and tax. Granted, 401 maxes at 10,500 (will be 11k for 2002!) and s.s maxes at 4984 so after these max out, you take home much more, but you should budget for the least net not the most.

 

[johndoh]

Don't we have any tax or financial consultants in this group? It'd be really interesting to get their input.

[This message has been edited by johndoh (edited 16 December 2001).]

 

[nsx1164]

Originally posted by Nsxotic:
... the big difference that I see is the insurance!!

Insurance in FL (Lauderdale) is higher than IL (Chicago):
- my renters insurance in FL is 2x my homeowners insurance in IL
- car insurance in FL is higher (no-fault state)

OTOH, garage parking is a LOT cheaper in FL -- 250/mo versus over 1300 in Chi-town (4 cars)

------------------
Manuel C
www.geocities.com/mcantoria/mc-toys.html

[This message has been edited by nsx1164 (edited 17 December 2001).]

 

[hejo]

Gee I'm surprised at some of the comments here and lack of money management thinking. AG NSX is pretty close to what a reasonable person should be spending. Let's clear up a few things.

nsxxtreme statement about the more you make the less you make is wrong. As someone who makes much more than $100k+ I'm not paying 50% in taxes, closer to around 42% to for fed, state and local. Here's the math using Fed 2000 tables I had handy for married individuals.

Gross Fed Taxes Net
$100,000 $22,300 $77,701
$200,000 $55,049 $144,952
$300,000 $91,468 $208,532
$400,000 $131,068 $268,932
$500,000 $170,668 $329,332
$600,000 $210,268 $389,732
$700,000 $249,868 $450,132
$800,000 $289,468 $510,532
$900,000 $329,068 $570,932
$1,000,000 $368,668 $631,332

In addition AG NSX isn't going to be poor when he retires, he's going to be to living comfortably. Here's a real quick retirement calculation assuming a pretty low ROR. Someone in their early 30s plans on retiring in their early 60s. Using a calculator from Templeton: http://pub.franklintempleton.com/public/inv_ed/inv_ed_open_f.htm

Assumptions:
Annual Salary: $100,000
Monthly Contribution Percentage: %12
Annual Percentage Rate of Return: %10
Years to Retirement: 30

--------------------------------------------------------------------------------
Results:
Balance at Retirement

Tax-Deferred Investment: $ 2,279,325
Taxable Investment: $ 1,226,009
A Difference of: $ 1,053,316

The top results figure illustrates what your account might be worth in a tax-deferred investment when you reach retirement. The bottom results figure illustrates what you may accumulate under the same assumptions, but without the tax benefits of your retirement plan.

Also there's a max personal contribution that one can make annually to their 401K. I think it was around $10.5k that few years but is going up to ~$14+ in 2002. Some companies match funds which actually increases the overall contribution while other companies don't. It's also important to invest beyond just you 401K if you want to maintain a pretty high standard of living. Anyone making over $100k should try to invest another 5% or more for retirement. Actually the percentage goes up with the more you make.

I don't think an NSX is a "real" investment. Yes there are some people who make their living off of buying and selling cars. However I don't think that's what we're talking about here. I'd be surprised if someone can buy an NSX, drive it, and then sell it in a couple of years for more money than you put into it.

Personally I can't see anyone paying $1k ($800 pmt + $200 ins) a month for a car unless they're making close to $150k+. If they're not making this kind of money then from my perspective they are being foolish with their money. A good rule of thumb is 1/3 of your annual pay for the value of the cars you own, or $100k salary = ~$35k car. If you don't make enough then people lease and this is a real losing proposition.

nsxxtreme I'm sure I'm not the only one who would be interested in seeing the math on how you made $8k on a used NSX. What year was it? How much did you pay for it? What did you sell it for? Did you trade it in or sell it to a private party? Was this related to the new Integra?

Also nsxxtreme's $30k investment in the NSX will cost him over $8k in ROI if he had instead put that money in a CD earning only 5% over 5 years. Also the interest on the loan over 5 years is another $4k.

I can't see dumping every penny someone has into a car. To do this to lower the payment so they can afford to make them is just dumb. It seems that to not try owning your place of residence or making investments for the future is just crazy. Like Cargy! said people who buy a car to impress people probably aren't and only mortgaging their future.

So I go back to my original post and contend it depends on a lot of things. But don't be foolish with your money. Live for today but don't mortgage your future either.

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hejo

Lake Oswego, Oregon
95T Blk\Blk SportShift