Can You Afford A Mercedes Benz S550?
09-10-2010, 10:41 AM
#51
Super Member
It is a guaranteed loss though. Let's face it, with ultra low interest rates it just does not make sense to pay cash for a depreciating asset. The problem I see everywhere I go is the comment "but there is no good place to invest in this economy/market". That is problem with investors. You DON"T WANT TO invest when things are going great. You want to invest when they are doing poorly prepping for the next cycle...
As far as the question goes. Every one is different. If your love in life is cars you can allocate a much higher percentage of income to that love than someone who loves vacationing or something else. If a car is an appliance to you then your payment should be as small as possible up to the point of meeting your safety, comfort needs.
In the end, you should still be able to put money away month after month for savings. If you cannot do that, you are overspending on a car...
As far as the question goes. Every one is different. If your love in life is cars you can allocate a much higher percentage of income to that love than someone who loves vacationing or something else. If a car is an appliance to you then your payment should be as small as possible up to the point of meeting your safety, comfort needs.
In the end, you should still be able to put money away month after month for savings. If you cannot do that, you are overspending on a car...
09-14-2010, 10:12 PM
#53
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Owned an Infiniti M35x, Drives an 08 S550 4matic
I don't think you have to be a millionare to afford an S Class, especially a used 07 or 08. Those are about 45k-60k for a decent low mileage vehicle.
But I would agree that you would need to make a decent salary (80k and above with close to no debt) in order to enjoy your luxury car and not take a big gulp every time the monthly bill comes in.
But I would agree that you would need to make a decent salary (80k and above with close to no debt) in order to enjoy your luxury car and not take a big gulp every time the monthly bill comes in.
09-04-2014, 07:09 PM
#54
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1996 S500 Sedan, 2007 CLK350 Cabriolet
Simple answer: I was always told "you should never pay more than HALF YOUR ANNUAL INCOME for a new car." I do find that a good indicator, if the car "fits your lifestyle"... of course, you can live in a rathole and spend a disproportionate amount on your car, but one big repair, and you're S.O.L. For a S550 @ $90k you better be pulling down $150-180/year if you want the lifestyle that goes with it.
09-04-2014, 09:07 PM
#55
MBWorld Fanatic!
Wow. Old thread! I certainly voiced my opinion. And have been through a half dozen cars since 
In fact I'm working on a new S now, and I'll be leasing it
And no, you should never spend half your salary on a car of this price range!
In fact I'm working on a new S now, and I'll be leasing it
And no, you should never spend half your salary on a car of this price range!
09-05-2014, 06:30 PM
#56
MBWorld Fanatic!
Are you working for banking companies? I think you should have a loan department making decision of car loan approval so no reason to extend its functionality to the forum. Every person if free to spend own money as he/she wants. Certainly I love free advices but I do not always follow them Please note also that many people in this forum have side income which sometime 10 times or 100 times more than official salary, they just do not want to make it taxable, so do not share with us.
09-05-2014, 08:07 PM
#58
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Are you working for banking companies? I think you should have a loan department making decision of car loan approval so no reason to extend its functionality to the forum. Every person if free to spend own money as he/she wants. Certainly I love free advices but I do not always follow them Please note also that many people in this forum have side income which sometime 10 times or 100 times more than official salary, they just do not want to make it taxable, so do not share with us.
Who are you speaking to? And what about?
09-05-2014, 08:22 PM
#59
MBWorld Fanatic!
I don't think it's a set percentage. As I mentioned earlier- it depends on how much you value a fine automobile. Some people don't go on vacations or drink fine wine but want to spend more on a car. Others are just the opposite. I would stay under 35% of total income for all major expenses- mortgage, car/loan payments, larger bills etc. The lower you can get that number the better up to a point of questioning return on assets vs borrowing. As far as direct car payments the numbers 5-7% are often quoted. But that is a starting point- if you are in a high cost of living region with high property taxes/state income taxes and/or have a high mortgage to income ratio, then you need to reduce that number and vice versa. Someone who owns their home outright and has small bills can spend 10-15% or more without sweating....
09-05-2014, 10:47 PM
#60
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2010 E350 4Matic
I don't think it's a set percentage. As I mentioned earlier- it depends on how much you value a fine automobile. Some people don't go on vacations or drink fine wine but want to spend more on a car. Others are just the opposite. I would stay under 35% of total income for all major expenses- mortgage, car/loan payments, larger bills etc. The lower you can get that number the better up to a point of questioning return on assets vs borrowing. As far as direct car payments the numbers 5-7% are often quoted. But that is a starting point- if you are in a high cost of living region with high property taxes/state income taxes and/or have a high mortgage to income ratio, then you need to reduce that number and vice versa. Someone who owns their home outright and has small bills can spend 10-15% or more without sweating....
Sounds like reasonable guidelines. Thanks
09-06-2014, 05:01 PM
#61
MBWorld Fanatic!
I kinda use the rule that the total amount owed on the car should be less than 1/4 your yearly salary (hopefully way less), but then the payments should also be NMT 3 - 5% of your gross monthly. With the current low interest rates, that is attainable even in this class of car. So buy used with high value trade-in - or lease.
BTW, my fuel costs are pretty low, lower than my other cars at this time.
BTW, my fuel costs are pretty low, lower than my other cars at this time.
