[UD17]

Buying luxury car that too after so much thought on finances, clearly indicate that its out if reach for you in current condition, Thus is not advisable to but. Moreover the luxury car do not have much aspirational values nowadays, no one cares what car you own (except your neighbors & close circle). The mass-market cars have improved so much that:

- The car costing 50% provide very similar functional value
- Some lower cost mass market cars are equally fast and fun to drive
- Total cost of ownership of luxury cars is way higher than an excel sheet can calculate (there could be some BIG surprises on the way as well+ remember you joined a rip-off club)
- Luxury car attracts unwanted attention
- You can not take luxury car everywhere, it will take a heavy bandwidth of your peace of mind

I could afford a new 330Li last year, but decided to go for Hycross ZX(O) Hybrid (Saved 30Lakhs). It has more useful features than 330Li, It has a high GC, Its reliable, high mileage (runs 50% of my gen3 city's cost), space/practicality and its equally fast & fun to drive (for my driving style).

[somersault]

I understand the YOLO perspective. I had it for long time. I wanted to purchase a BMW since a very long time when I was in salary 8-10 years back. I could have afforded it at that time. But then it would not have 'looked' right in everyone's eyes. My boss was driving a Ford Ecosport. My extended family members were driving Honda City etc. So I purchased Honda City.

10 years down the line, I still had that dream of buying a luxury car. But this time it was not BMW. BMW moved from 38 lakhs on road to 75 lakhs on road in no time. Buying the same vehicle at double the cost made no sense. So BMW was out of question. Started looking at Q3 and liked it. But the fact that the other cars in VW used same engine and had better specs made me look into other cars as well.

Finally purchased a Kodiaq recently and I am satisfied for the use case. I am fully enjoying it.

For most people, it was still a bad decision to purchase 50 L car, but then it was again an informed but YOLO decision.

So what changed in between.

1. I was able to repay all my loans including home and car loans
2. I started my own startup and made it profitable. So buying through business made some sense than buying through personal finances.
3. I could provision for education of my children and other details.
4. Stock market boom which increased my net worth more than I was expecting.
5. Continuously and steadily increasing personal net worth over last 10 years.
6. Health Insurance and other insurance policies in place.

The point I am making is, YOLO is important but you should have infinite patience to achieve your dream, after fulfilling all your obligations to your family and self. You need to plan it for at least 5 years along with your other commitments and see how you are holding up. Be dynamic on plan. i.e. do not stick to a particular brand or type of vehicle. Be open to other equally good options.

So what I achieved after purchasing Kodiaq? - Immense driving pleasure. Period.
If I am not able to enjoy the vehicle, then what is the point for buying. Do not buy a luxury vehicle for show-off. You almost certainly will have a guilt feeling after few days.

Hope it helps.

[Bsreecharan]

Originally Posted by wheelspinner

Hey BHPians,

I'm at that stage in my career where the dream of owning a luxury car is starting to feel a little less distant, but the reality of EMIs and general life responsibilities is definitely keeping me grounded. Like many others, I'm juggling the desire for a little automotive indulgence with the need for financial prudence.
…
I understand this is a personal topic, but I believe your shared experiences can provide invaluable guidance to those of us still on the journey. Your insights could potentially make a huge difference in how we approach our financial goals and automotive aspirations.

Looking forward to hearing your perspectives!

Cheers,
wheelspinner

Hi Wheelspinner,

I am 46 yrs old, working in a corporate, spouse works too and two kids. elder one is 5 years away from higher education and younger one by 10 years. My car ownership history is Alto->Figo->Vento->Jeep Compass->AudiA4. I currently have Jeep Compass and Audi.

I have developed great desire for a refined car with on tap high acceleration, that I experienced in my brother's X1. My JC was anything far from the refinement I wanted. I got Vento and JC on company lease to save tax. With JC out of lease after 5 years, I was looking for a premium brand that can give me the cabin experience when I am stuck in hours and hours of BLR traffic. I considered BMW and Merc 3/C but the cost was unreasonable for me. I scanned used cars, though tempting, it is a hit or a miss. New cars give you 5 years of peace of mind at a minimum, except for accidents (for which you have insurance). Maintenance and Insurance is high for sure but its the price you pay for quality. Finally, I got a brand new A4 at a good year end deal with support of my wife. I felt A4 was 90% or more of 330Li @ 80% of its price, which is a more reasonable price for a heavily taxed product. My wife and I had this desire to own / drive a premium car. And the bigger reason is if not now at 46 then I will get into a bigger responsibility zone...hence bit the bullet now. I bought A4 with part self money and part bank loan. And unlike my previous cars, I intend to keep Jeep and Audi with me for over 10 years.

Now coming to uncertainties of life...cross the bridge when you get there. We cannot make plans for every scenario. The economics while important, are not everything. Don't go with youtube university courses. As long as the outflow does not impact the way you are living now, you will be fine. First one year will appear a bit tight and it will ease up with time as incomes grow.

All the best for your decision...house or car its always a leap of faith and plunge...extremely fearful before you get in.

[100Kmphormore]

Based on what I have seen in my circle, unmarried/married with no kids, with an active lifestyle - atleast 30 LPA for a entry level luxury car, say a 330i/320d (this is assuming the occasional party/eat out and maintenance/fuel/EMI for the car). Assuming 30 and above age group who also do investments. Also, mistakes or lack of attention is a strict no-no (they do happen, but some have that chalta hai attitude, its okay attitude) and can be a costly affair, especially if damage happens to the car/bike.

Another thing is, prioritize what you want. To get my nearly 8 year old 390 Duke and maintain it, rides have had to reduce a LOT due to the fuel economy. Also, eating out, buying new clothes, gadgets, movies etc if you are not on the same salary scale as your circle. My last clothes purchase was 6 years or so ago, with bits and pieces added when absolutely necessary. My friends once unhappy now know that Salaga (the 390) is an integral part of my life (or rather the most passionate thing apart from them). Shumi makes the same points in an episode of MotorInc, ThisConnect season 1.

Add kids and its a comfortable 50LPA +, especially if you do not own a house and have a home loan, do not look towards the showroom or your cheque book. Education, rent and healthcare have gotten really expensive (I will be 29 in a quarter and comparing from late 2000s) and those expenses are really fistwrenching, especially if those went against your will and you hate to see your expectations as unfulfilled dreams.

Where I find luxury cars to be their worth is with 6 cylinder diesels like the 530d or the E350d - that smoothness, RWD drama and bucketloads of torque is something else as I found out with a G30 530d. We own a 4 cylinder diesel in a lower state of tune compared to the same which has around 60 hp and 140 nm torque more, and honestly, not a lot of difference. Perhaps the only luxury car and reason I have it on my 1 cr garage list in a recent thread and may take a long time, else the others are attainable 5-10 yrs away. Most turbo petrols in the 15-25L range, except perhaps the 6 cylinder M340i, fulfill the performance need in our country where finding good roads everywhere is a challenge.

[anjan_c2007]

I have read most of the posts here.

The first thumb rule is that since ages buying a car is easier. One must be able to maintain it. Once luxury cars reach a workshop, usually the ASC bills upto Rs 1 L or more are not uncommon.

The second thumb rule is if you buy from the showroom, be ready to see your luxury car depreciate in value from Day One. You may not get even 25 % of the original price by the 12th to 15th year. Please check through the teambhp classifieds to get a first hand information. And it doesn't have a good liquidity - buyers come by with difficulty.

The days when someone bought a Mercedes Benz W123 in the 1970's and decided to use it for 50 plus years are gone. Yes, the W123's (called tanks by some owners) in pristine condition are still around in the hundreds in many parts of the world. Check out the later Mercedes W 210/211 and the later models. These are disappearing from the roads fast, as these have not been made to last. Its a similar situation with many other luxury and mass produced brands that have been manufactured in the post millenium years. Hence, your new buy will need to be replaced after the next 15 years.

Hence, only when you have the resources that may not at all or only marginally affect your finances, you can decide to buy a luxury car. Never otherwise. And the used markets are a strict NO NO for such cars unless you know the previous owner and its service history. Most of these are chauffeur driven, and we know how an average chauffeur drives or maintains these.
Because some surprises can pop out post buying, that could set you back with hefty bills. An used car comes cheaper but the spare prices and labour charges don't distinguish between the old and new.

[AirbusCapt]

Originally Posted by wheelspinner

Hey BHPians,

I'm at that stage in my career where the dream of owning a luxury car is starting to feel a little less distant, but the reality of EMIs and general life responsibilities is definitely keeping me grounded. Like many others, I'm juggling the desire for a little automotive indulgence with the need for financial prudence.

As long as you can afford it, go for it. What is affordability? Either have enough spare money to straight up buy the car or the total monthly EMI outflow should not exceed 1/3rd of your monthly takehome. If both options dont suit you then consider a pre owned car which will involve a lesser outflow with increased maintainence expenses.

[FAIAAA]

Have owned 2 luxury cars ( purchased new and sold at a significant loss- E200, 320D) in the past and now drive a Verna 1.5 Turbo DCT and a Honda BRV CVT as the beater car.

Let me address your queries one by one -

1. Financial planning / Income threshold
It comes down to how long you wish to work for a living, when do you seek financial freedom. Your attitude towards freedom vs lifestyle. Wealth is defined as the money that works for you when you are not working. In India, typical rule of thumb for retirement corpus is, 25X of your annual expenses. In my case, I choose freedom over lifestyle and that I find liberating. Also remember, Quality of life isn't just about the car you drive, but how you live in general - love, health, relationships, apartment, recreation /entertainment/hobbies, travel etc. Idea is to have a good life and not have to compromise on other areas or work in such a way that leaves one stressful, no health and time to enjoy life.

2. Car choice - Luxury cars or premium offerings of mass market players
There was a time that *luxury* cars meant performance and features. Today the 20-35 Lac segment is very competitive and offers similar /more performance and features than new entry level luxury cars available today and definitely more than the pre owned ones you will consider. They may not have the finesse, build quality and refinement like the German trio for example, but they will give you 70-80% of the experience at 30-40% of the price. For example, who would have thought that Verna Turbo will have more power and torque than a BMW X1!! Also maintenance and overall cost of ownership will definitely be lower.

3. Emotional dimension
This is the most important, and often, overlooked dimension. I would suggest you/others read Stages of Personal Power by Janet Hagberg - true for both people in organizations and Life at Large. As we progress through life, we move through the 1st 3 stages of external power - Powerlessness, Power by Association and Power by Achievement. We are largely conditioned by what we see/hear around us and seek validation of our self worth through what our role models have and what we acquire. With age and experience, many start questioning this template of life and move to higher stages of internal power - power by reflection, power by purpose, power by wisdom.

I am, by no means, saying one shouldn't have and follow their passions. Just look at the big picture, your values and life goals and then choose. As Naval Ravikant observes, the things that matter in Life are single player games - health, wealth, knowledge, Spirituality, time etc. Status, Politics, Religion etc are multi player games ( higher or lower, winner or loser, have or have not) and best avoided.
Ask yourself - are your seeking mobility, freedom to drive out, travel and experiences at large as and when you wish to, OR, seeking an object ( savings between a luxury and premium offering could fund so many other experiences).

All the best with your choice and keep us informed.

[SafeandGreen]

All very sane and sound advice from fellow BHPians and I agree with them particularly w.r.t financial planning. I am now retired and have never owned a luxury car before. I could perhaps afford it but it never made sense to me to own one before all responsibilities (the usual ones of any family man) are behind me. I managed to build a house, put kids through college, take care of parents and ourselves without ever borrowing a rupee. All the while we have had our share of fun including holidays abroad.

Now I believe I can truly enjoy a luxury car for whatever remaining years of driving I have left in me. It is indeed almost a need now to have ventilated seats, multizone AC (wife loves AC at max cold; I don't), the assurance of a solid build, safety of umpteen airbags, comfort of a calm, low-noise ride. More than anything the confidence of not having to break the bank in case something goes wrong with the car. Where is the enjoyment of riding such a car when you are constantly anxious - about the looming EMI, the resale value, the upcoming maintenance cost, strict rules to all the family about drinking/eating in the car

So buy it only when you don't have to care even if it gets totalled in an accident or it is stolen. Never forget that a car is only a piece of metal, plastic and silicon!

[harikrishnansp]

Originally Posted by lemedico

Whilst I agree with all the other comments on this thread, I don't see anyone recommending what I occasionally do.
Drive my rich friend's cars! They are close mates, collectively own a vast selection of cars and one could satisfy the occasional itch to look posh, or drive fast (eg at BIC) at their expense!
All this while I remain debt and liability free.

If you have such a friend who will also trust you with their car, you have won in life..!

[Chinni]

A small suggestion, in case you are going to purchase a luxury car.

Since in a year or two most luxury brands will be coming up with electric cars, maybe one can wait for sometime and choose from a wide variety based on reviews and test drive, since the future of cars, luxury or otherwise is likely to be electric. Government also is planning on those lines for the country.

I am planning on a luxury car too, so just sharing, not really very sure if I am right.

[Way2Jimny]

I'm in the same boat as you are and have not bought a luxury car yet. I came close to buying one in the year 2015. It was the BMW 320d base variant. I think it was called exclusive edition. The car was priced between 40-45 Lakhs after discount.
I could have taken an EMI which would have been 50% of my salary that time. I skipped it as no one in the family thought its financially prudent to do that. Ten years later, I still haven't bought the car yet. I regret not buying it back then.
You can take calculated risk when you are young. Now, family and responsibilities have taken precedence. Only you can evaluate your financial position and plan for it. Different people have different priorities. Don't let your dreams be dreams.

All the best!

I'm still eyeing that Bmw 3 series

[shankar.balan]

Luxury cars. They are an itch which one just needs to scratch. Provided that one has reached that level of financial security.

I have a slightly different take on these things. Do whatever makes you happy, if you can afford it. Do not leave room for regrets in this life which is all too short anyway. I agree with the sentiment of choosing freedom over visible lifestyle trappings. Again it is, as always, dictated by affordability.

I realise also, as I grow older and hopefully a little ‘wiser’, that the best car for you is the one that suits You and not what others think or dictate that you should drive. What suits You, may be a BMW IX1 LWB or a Porsche 911 or a Maruti Swift or a Jimny or a Mahindra XEV9.

Let no one and nothing else excepting yourself and the size of your pocket, be the judge of what suits You!

[V.Narayan]

Several have said this in earlier posts but I'll risk a repetition. Luxury cars are overpriced especially when bought new. If buying new, work out the budget you can afford with just a wee bit of stretch. Then divide it by 2. The resultant figure should be your budget and buy what that affords. This has worked well for me for years. In the Indian tax & price situation beyond Rs 5 million you get only marginal upticks with every extra million spent.

[MercedesFan]

Hello
Few words from my experience.
As i see you are on team bhp forum so you must be an auto enthusiast.
So first you need to ask yourself how much time and money are you willing to spend on a luxury car, then you need to check priorities of your life and take your spouse on board.
Then ask yourself if you want to go for a pre-owned car or a new car. If you are mechnically inclined then i would definitely recommend going for a pre-owned car and save yourself a lot of depreciation.
But if you want to have a brand new car then decide to buy a car one segment lower than what you can afford, as told by GTO.

Getting a luxury car should be for the love of car and not for show off, if you have money to spend and just want to have something that will lift up status in community then go for Lexus/ high end toyota.
If you want to enjoy driving then look for german brands.
Be ready for unforseen breakdowns and expenses.
And always keep one run around car for back up.

[thenewsymbol]

Originally Posted by wheelspinner

Hey BHPians,

I'm at that stage in my career where the dream of owning a luxury car is starting to feel a little less distant, but the reality of EMIs and general life responsibilities is definitely keeping me grounded. Like many others, I'm juggling the desire for a little automotive indulgence with the need for financial prudence.

Financial Planning: How did you approach the financial planning process for buying your luxury car? What were the key considerations you factored in (e.g., depreciation, insurance, maintenance)?

Income Threshold: What would you consider a comfortable income level to comfortably own and maintain a luxury car in India? (This is, of course, subjective and depends on lifestyle, but a ballpark figure would be helpful).

The following are my humble opinions and things that I follow.

As long as one has to think of EMI he/she should not think of owning a luxury car. Income level should never be a consideration for buying a luxury car. (For example just because you stated earning more 1Cr in a year or whatever Cr in a year can never be a consideration for buying a luxury car).

After attaining FIRE ready with a comfortable lifestyle you can think of buying a luxury car. FIRE ready is when you have enough assets such that

1. You have no debts
2. If there are debts then your liquid assets should cover it to close the debts in a single week without any compromise on your lifestyle, needs, wants.
3. You live in a comfortable house all paid for in a nice part of the city (you don’t want to be the only rich/upper middle class guy in your area).
4. Your assets cover education in India of your kids if not education outside India. (In another 15 years, if education inflation continues in the same pace, it would cost 800K USD for an MS in a nice university without scholarship in US).
5. Future economy could be tough on Today’s kids, you should have enough assets to help your kids till they can stand on their own depending on their career choice.
(Consider Today’s Doctors, they study till they are 30, earn a very moderate salary even after MS till they attain expertise for Independent practice).
6. Your assets should cover lavish spending for kids marriage and after marriage cultural expenses. (People respect frugal or relatively simple wedding ceremonies only if its done by people who could easily afford lavish weddings without any difficulty). So you should have enough assets for such expenses, you do such expenses or not is your choice after you can afford.
7. Your assets should cover the worst possible medical expenses if you live a long life (If you live long enough, chances of cancer increases, no insurance is going to cover cancer expenses in their entirety).
8. When you go on vacation, you should be able to easily afford staying in hotels which are almost completely carpet covered.
9. In you apply for tourist visa of even the toughest to get countries, they should easily grant you visa. (If you have enough assets they any country will easily approve).
10. You should have some sizeable assets to leave your kids after your life apart from the house you live in.
10. After having enough assets and then your income stream (passive or active or both) can easily support upkeep, maintenance, insurance, part replacements etc of a luxury car is within a months average income he/she can outright buy the luxury car of their choice.
11. Do not buy used luxury car unless you are very rich (well and above aforementioned criteria). Rich can think of saving 50 Lakhs by risking 50Lakhs. But rest has to put down entire 1Cr so that you can be sure if it turns out to be lemon it will be replaced by the car company.

Also remember, top variants of humble cars such as Creta, XUV700 etc are punching well above their weight.
They are close to luxury cars than most people realise except in very few things which sets them apart.

Buying a luxury car at 50 or 60 or whatever old age is also nice. You can be happy with a fully settled life + kids life settled and buying a luxury car than buying it in your 30s or 40s when you’re still not sure how your life is going to be fully.

If you’re already from a rich background and you’re family already covered aforementioned points for you then only criteria for you to buy luxury car is your income and affordability even with EMI so that you can buy it yourself without asking your family for it (if they not already buying you one).