Originally Posted by Eatadonut
So if I bought a new used tercel every year, I'd spend $2800 annually to have a car. If I kept that tercel for 4 or 5 years, my annual costs would be lower.
So now that's out there, what are you spending the rest of your $29,200 on?
EDIT: insurance, of course. Call it $75/mo, so an extra $800 a year. Now you only have $28,400.
Wait a second. A 32K salary is about $1,500.00 dollars a month net income (providing you're contributing to a 401K as you should be). Rent alone for a one room apartment can set you back about $1200- $900 USD in the New York Metro. I suspect this is the case in many cities but this leaves you about $500-$700 (or less) dollars a month to play with. You now take this money and pay off your credit cards, student loans, food, utilites, cable bill, cell phone bill, lunch and what are you left with? You haven't purchased any clothing, vacations, gifts or how about dating or just going out with the guys! If you have to spend a significant portion of this $500-$700 on a vehicle, now you're really broke!
Saving $3,500.00 hundred dollars a year for a car was a lot of money for me back then and still is! That's what you have to make (pretax) in order to spend $2,800.00 dollars on a used car. It would take about 5 months of saving every penny I had to come up with that kind of money.