My income is $51,000. Comes out to around $2956 per month after taxes and automatic 401k payment.
I pay 550 in rent (I have a roommate in a midwestern city).
Outside of that, I've been putting $500 towards my IRA every month, spend about $300 in groceries per month on average, and have about $150 per month combined in other misc bills like subscriptions. Plus I budget a couple hundred towards eating out/fun activities.
I have around $30,000 in student loans however I have around $12,000 in an account dedicated to student loan repayment through AmeriCorps (this money is taxable so I can't pay it all at once without having a big tax hit). This makes it so I don't have to pay student loans out of pocket for the next couple of years if I choose not to, although I do try to pay extra every month to pay them off faster.
I have been looking around for cars and have been putting cash aside over the years with the intent of using it on a car. I have enough saved where I could comfortably spend $10,000. I've been looking for decent used cars and there don't seem to be any in my area in that price range. They are either junk or ridiculously high mileage or both.
My thought is to just buy a new or lightly used Corolla and use that $10,000 instead for a down payment. I have estimated a payment of around $250/month for 48 months on a brand new one. This is a car I really like and that I know could last me decades if properly maintained. Whereas a used car would be cheaper overall but would be much less likely to last a long time. I know I can get a rate of around 5% financing with my credit union. It seems like this payment, with the addition of insurance (around $140/month), gas, and maintenance would fit comfortably in my budget.
Even in a worst case scenario where my income doesn't grow at all over the next few years, I lose my roommate and rent doubles, and I have to completely make my student loan payments out of pocket, it seems I could still make this work, although less comfortably obviously.
Basically, I would just like for someone to tell me if this plan makes sense or if I'm being delusional for thinking this could work and am not considering something and there are better options out there.
Submitted November 23, 2023 at 10:50PM by Stanley_Yelnats_III https://ift.tt/qIjkMb7
