Need Some Validation on Buying First Ferrari

DCTs on the 458 and cali fail usually to the overheated sensor. Having a shop that can handle the transmission failure happens is a great thing to have in the bag. Just put the pieces in play. The 458 is an amazing car. I would personally do it instead of the 430 if I would upgrade.

 

Can i ask you of your annual income Is net of taxes or gross income?
Also, but this is just my opinion, since you're the sole breadwinner in your family, I think it would be best if, before buying a Ferrari, you secured your family financially in case something were to happen to you. I'm thinking of taking out life insurance and increasing your net worth to at least $5 million, so you have more financial flexibility and a decent passive income. Then you can easily afford a 458. Anyway, this is just an advice; do what will make both you and your family happiest. Best wishes.

 

I absolutely disagree with this.
No, you don't have to have $5 million dollars to buy a $120 to $200k car. You can sell it anytime. Alternatively, a loan can be had to defer the outlay. That's anxiety about money if you need THAT much for a toy.
Nobody says "you must own your house before you have kids! or you must have $500,000 in cash before you have children". If this were true we'd be too old to have children when we eventually financially could. One day you will be dead or old with alot of money but no health to enjoy it. It's all the old guys who argue "if you can't pay cash you can't afford it" that you see complaining about back pain as they crawl into their exotic.

 

To be fair this poster might be referencing or living in Connecticut or Upstate New York and is thinking lifestyle along those lines.

Not frugal guys like us

 

+1 in Vegas that is a lot of money, 458 is no sweat. I put a chunk down (can't remember the exact number offhand but like $60-70k) and IIRC my 458 payment from FFS was like $1350 a month.

 

I apparently live in a different financial world and mindset than you guys. I make WAAAAAAY less than you guys and have 4 cars currently... total car payments around 9700. And I only make about 250k USD per year and have less than 50k in savings/investments. I don't own a house or property either, I rent. I don't see or understand all your extreme math of affordability. Makes ZERO sense to me to work and make money without spending it. Spend it all except a few months of bills for savings is my philosophy. What good is staring at numbers on a computer or your phone screen and then get hit by a truck? Money is worthless unless you use it.

 

I'm not in the top money here either, but my own strategy is based on the ego-shattering trauma of losing my butt in the 2008 crash and spending several years digging out starting over in Las Vegas (economic ground zero) with two, then three, kids at home. I didn't finance *anything* for almost a decade, paid cash for cars... until I finally said I needed credit again to get a mortgage.

With cars now if I finance I just make sure to stay 'in the money' with positive equity, so if things hit the skids personally I could take the car to a dealer and get out of it without owing a payment. Thankfully, my business has grown from 15 years of working like a maniac and even with the expanded obligations, they are manageable and don't keep me up at night.

Having lost several family members (grandparents, two uncles, brother-in-law my age) over the past few years has put me in a bit of a YOLO phase too.

 

In fairness, that's a young guy philosophy. Saving/investing money when it's coming in pays for the years when it isn't any longer. If the plan is to eat a tree at 62 in your hypercar, then never mind.

But the OP making half a million a year and worrying about a $2000 car payment is counterproductive.

 

Ya, not to be morbid or cliche but one thing I know I DEFINITELY DO NOT WANT is to suddenly be very sick or physically unable to enjoy things like cars or be moments before death and look at my phone screen and see thousands or hundreds of thousands of unspent dollars. What a waste of hours, days, months and years of work that would be.

 

I'm 56 but in fairness, I don't have kids or others depending on my income.

 

Yeah. My wife's grandparents died as multi-millionaires of the classic rural Millionaire Next Door business owner style (general store and gas station). Only drove Toyota and had a 1991 Toyota pickup and a new Camry every 7 years. Didn't travel much. If they wanted anything, they certainly hid it well and had essentially zero 'extravagances' despite a healthy portfolio of RE and investments. They lived on the shore of a lake without owning a boat. No luxury travel. Dedicated to church service.

On the one hand I deeply admire it and wish I had their Puritan restraint - I'd have a lot more money already. But then... for what!? If it isn't to spend and enjoy and donate to things I want to help right now, what's the benefit?

 

Spend it while you can
Money's contraband
You can't take it with you when you go
Spend it while you can
Before it's taken from your hand
There's no free ride in this carnival world
-- Jimmy Buffett

 

Sorry, but I must have expressed myself poorly. What I meant was that, since he is the sole breadwinner for his family, and he has two young children, first and foremost he needs to ensure his family is financially secure, in the unfortunate event that something were to happen to him. The figure was purely indicative, to ensure a prosperous future for his loved ones.

 

Yeah in that case who cares. More power to you.

I hate having payments but also love exotic cares. It's a conundrum. So I have to save.

I keep the monthly spend absolutely low but that allows for a cushion every month

Everyone's different

 

Wasted for you individually? Maybe.
I dont see it as wasted.
It's a spectrum. OP and me are somewhere in the middle. Extreme spenders and savers on the ends.

When I cant work, I dont make money. My first goal is to replace my job with investment income. That's why I'm investing at least double my monthly ferrari payment. If I rapidly decline in health, then the fact that Ive got (x) million dollars in assets gives me options unavailable to the average joe.

Do you need $5m in the bank to enter the Ferrari brand? Absolutely not. But there's no way im going to live paycheck to paycheck just to be a slave to 5 exotic cars in the garage.

 

I am going to offer the contrarian view. With kids come after school and weekend obligations. How and when will you drive your car? Its a two seater, will your wife go with you? Date nights? Give the car to valet? Service is important wrt costs. Insurance costs. I would rather see you have the passive income from investments pay for the "toys" and such. The power of good investments and compounding at your age is amazing. Not to mention 529 plans for the kids and/or Roth IRAs for the kids if possible.
I focused on FU money, had my own business and retired at 56. I have a collection of cars approx 20+ Ferraris , Porsche , Astons, etc - not to brag but did it from a position of passive income - not work income. I would say the Freedom/Security is worth more than the material things.
All that being said - GET THE CAR!!! But really figure out how you will use it - or it will just sit. 458s don't like snow...

 

Are you saying your car payments are $9700/month? On a $250k salary with less than $50k in the bank? So if you lose your job your car payments alone will drain that savings in less than 6 months? (Let alone real living expenses like rent and food and bills). I wouldn’t be able to sleep at night!

 

lol ya that's accurate.... but I still just don't understand the 'what if I lose my job' thing people always refer to.... I mean, isn't it just logical to think, if I lose my job, I'll go get another one? Or simply do something else to earn money?

 

Welcome, you have thought things out and appear to be in a fine financial position to just do it. while lots of opinions on the subject of finance it or pay cash. I feel its a toy and pay cash for the car. It sounds like you can do that and a 458 can be sold very quickly in an emergency..
You are young enjoy life and if you want buy that Ferrari. I am old and have always had cars that i love ..
good luck and enjoy.

 

In theory you could just get another job, but with that large of car payments plus I assume another couple thousand a month in rent and bills, you’d only have a few months to get a new job before being in financial trouble. Replacing a $250k a year job could take longer than that especially if the economy is slow. Typical advice is to have at least 6 months worth of emergency funds. But different strokes for different folks I guess!

 

Ya i hear ya. Of course you make sense but I'm also lucky enough to be in a business that is plentiful and I am very well known and wanted so ya, it'd be easy for me to get another job. I know I'm fortunate in that regard. But even if I wasn't in this position, I still believe in spending what you earn and just keeping a few months living expenses in savings. 6 is a good number. Believe me though, I certainly have my moments where I think it'd b nice to be able to take a vacation or stop working for a while... I often say if it wasn't for my car obsession, I could probably have retired or at least be ok to work less. As of now, it'll have to stay at 12-18 hours a day, 6 days a week. I'll probably be one of those guys that just dies at his desk lol .

 

if i were you, i'd locate a well-sorted 328. it is by no means a super fast car. but it'll make you
poop your pants if you think blinding speed is all there is. it will also get you killed if
maintaining the "boy racer" image is required.

i sold my 328 after 14yrs. of ownership. i was 54 when i bought her and always regretted selling her.

about a year ago i decided to search for a tidy, well-cared for Mondial. was not successful.

i gave up hunting for another vintage Ferrari after not finding one that suits me.

i'll always miss my Ferrari . i'll never take down the Cavillino banner hanging on my garage wall!

so......you might ask. what's in her garage space now?

a maserati granturismo cabriolet. 2x the hp and handles like my old Flexible Flyer!