To buy a lotus, or...

[strud]

Hi all! Im new to the forum; however I have been creeping it for a while.

Looking for some advice from lotus owners.

I am 20 years old.
Im a succedful Realtor up here in Canada and making close to 6figures.
I am renting a place for next to nothing.
I am a true car guy, and have been around them my whole life.

I am considering purchasing a used elise, and driving it for a year or so. Then selling it and purchasing my first place. Im thinking that once I get myself tied down to a large mortgage, and living expenses a sports car will not be as accessible. I dream about owning a sports car daily. I have the means to purchase one now, and do not want to wait and have a home, and family put it off for decades.

What would you do? Buy a property in a flat market, or the car of your dreams?

Cheers,

Scott

[ojars]

Well now -- I would save at least 10% of my earnings each and every month, investing same for the long term, and whoop it up with the rest. This way you will be a millionaire in a short time, perhaps even a multi-millionaire with some luck.

Forget the large mortgage and strive to live simply, meaning making do with such essentials as a 3-car garage with ever-so-needed tools, if you really must purchase property. live in an adequate neighborhood and keep a low profile. Tony digs at the limit of your actual income are for suckers.

This way you will have ready cash from the remaining 90% to keep your stable running and go on cruises or to Europe with your significant others.

[Elise8206]

I would buy house first then nice car

[Monsi]

buy the lotus... save as much money as you can, and buy a house in like 5 years... if you make six figures it shouldn't be that hard to do. you dont want a house loan at that age

[ojars]

Consider for a moment you stuff a barely noticeable 1 grand away each month. An average return of 5% over 20 years nets about 160,000 above the 240,000 you have contributed. An average return of 10% nets abut 500,000 above your contribution. An average return of 15% nets more than 1,000,000 above your monthly nut. This is with no more work on your part than finding a suitable investment vehicle (not a savings account). And you are only 40 with many years ahead of you. Cheers!

[JoshS]

If you are not married get the car, the market is still gonna go down over the next two years. By that time you'll have both.

[Mag]

If the markets in Canada and general economic activities have a high correlation to those in the US, I'd say buy the car first. Drop in auto market should precede those of properties. Timing differential is on your side. Enjoy the car now and wait out the credit squeeze, which should take years to unwind, before reversing.

[catapult]

Depending where you are in Canada, "close to six figures" is not great (sorry to rain on your parade) especially when you should be saving for a home or making other investments and taking into account that cars are still quite a bit more expensive here. As a real estate agent, saving is particularly important as markets can drop (and therefore your income - my mum's been an agent for 30 years so I've seen both the really good times and the really bad times). That being said, if you've done the math and your budget allows for some decent savings and the car, then go for it! You'll love it! Also, as you probably know already, you can withdraw up to $20K (at least that's what is was a few years ago) from your RRSP (registered retirement pension plan) for a downpayment for a first time home buyer. Also, contributions to an RRSP are tax deductible so you definitely IMO have to max these out before buying the car (unless you like paying taxes).

Sorry, one other thing, I assume you're not planning to take clients around in the Lotus for showings.

Good luck
Carl

[strud]

Originally Posted by catapult

Depending where you are in Canada, "close to six figures" is not great (sorry to rain on your parade) especially when you should be saving for a home or making other investments and taking into account that cars are still quite a bit more expensive here. As a real estate agent, saving is particularly important as markets can drop (and therefore your income - my mum's been an agent for 30 years so I've seen both the really good times and the really bad times). That being said, if you've done the math and your budget allows for some decent savings and the car, then go for it! You'll love it! Also, as you probably know already, you can withdraw up to $20K (at least that's what is was a few years ago) from your RRSP (registered retirement pension plan) for a downpayment for a first time home buyer. Also, contributions to an RRSP are tax deductible so you definitely IMO have to max these out before buying the car (unless you like paying taxes).

Sorry, one other thing, I assume you're not planning to take clients around in the Lotus for showings.

Good luck
Carl

Thanks everyone for the advice. I realise my income is not huge. If it was, then I wouldnt have to pick, Id have both.

I already have a 2006 pontiac g6 gt for my daily driver/client vehicle.

Hmmm.

[Z-dculus]

don't spend any of your money. Invest nearly all of it, watch the market tank, and stash the rest under your mattress so that you can die with as much money under there as possible. Having fun when you're young is terrible, trust me i know from experience.



oh, and disregard everything i just said. and have some F'ing fun!

[mikecronis]

On Canadian roads?! I'd never buy a Lotus. It'd rattle itself apart! Worst roads in the universe. Pure potholes and gravel. I've been to Honduras and Belize and their roads were better.

[NavyLt]

Originally Posted by mikecronis

On Canadian roads?! I'd never buy a Lotus. It'd rattle itself apart! Worst roads in the universe. Pure potholes and gravel. I've been to Honduras and Belize and their roads were better.

Do you think that you could generalize any more than that? I am sure that you have driven on all of our Canadian highways and visited every city to check out the road surfaces. Yes, we do have pot holes, especially after a long winter. No, they do not all get repaired in record time. But to make such a sweeping and uninformed statement as that is just preposterous.

[Hand_Banana]

Originally Posted by Z-dculus

don't spend any of your money. Invest nearly all of it, watch the market tank, and stash the rest under your mattress so that you can die with as much money under there as possible. Having fun when you're young is terrible, trust me i know from experience.



oh, and disregard everything i just said. and have some F'ing fun!

+1 Seriously, 6 figures in the bay area doesn't get you much but I have both. Granted my "house" is an 850 sq foot 1 bedroom condo, but what are you going to do? I'm happy with the basic necessities. Lotus, Moto, and a place to store them.

[street_carp]

Originally Posted by strud

I am 20 years old.
Im a succedful Realtor up here in Canada and making close to 6figures.


Scott

Wow. Knowing people in real estate and knowing how difficult it is to start esp. in this market you are quite a real estate All-Star. By age 30 you will be bringing in 7figures easily.

[catapult]

Originally Posted by mikecronis

On Canadian roads?! I'd never buy a Lotus. It'd rattle itself apart! Worst roads in the universe. Pure potholes and gravel. I've been to Honduras and Belize and their roads were better.

The roads here in Toronto (ie. in the city) definitely suck. The highways are fine though. I'm doing a road trip next week from Toronto to S. Carolina - should be fun - have nothing planned other than a general direction. I'll update my findings when I'm back.

[Kevin M]

Your question is much larger than it appears.

Car or house all becomes much clearer when you actually build yourself a financial plan and set yourself some clear goals and objectives.

A hundred people told me that when I was 20.... when you are 20, most of us do not see things the way we do when we are ... well, much older than 20.

When I was about 25, I started settling myself some goals and the old adage , "what you write becomes true" actually works. Try it!

Someone mentioned earlier that the Lotus won't exactly be very conducive to driving clients around. That is an excellent point. If you do not already have a suitable car for that, you should work on that first. It is a tool to help you earn. I know you want the toys now, but just know that they are just as much fun when you get older too.

Someone else said that it depends where you live. So true. There are parts of Canada where you can still buy a house for $150,000 and others start in the $400K range. This all has an impact on your decision making.

Oh... and to the guy who said all the roads in Canada suck... Yes, that sometimes is true, but I've been to your state and I saw some pretty backwoods sh** out there too. I filled up at one of your small towns and the snaggle-toothed half-wit who wanted to fill my tank would just as soon bone you up the *** as pump your gas.

There are all kinds everywhere, bub.

It's true. There are some crappy roads around where I live, but there are also some pretty nice ones.

Let's leave the generalizations to the ricers, huh?
Kev

[MichaelB1969]

No question I would buy the house. Over the long-term, the house will appreciate. The Lotus surely will not. Get the house, be comfortable with the payments, and then get the Lotus. Heck, you're only 20. You have p-l-e-n-t-y of time,

[Simba]

You're 20. Buy the car. It's in the rules somewhere.

[ransackman]

Get the car, have fun. Screw responsibilities, I always do .

[shoco]

These next five years are going to fly by- believe me! If you really love sports cars you might want to consider relocating somewhere more temperate.
I lived my first twenty or so years in Wisconsin so I know the weather is not your friend that far north.

A Lotus? Well, you will only be taking it out on good days, I would think. And those days would be memorable. Perhaps you should consider a less fragile car for the great white north, maybe a MX-5 turbo which should be out shortly.
This would be as much fun but more durable in the harsh conditions.

Do not buy real estate now. It won't bottom for at least another two years minimum.
Oh, and go with your instincts of the color by what moves you. Look at the colors in person under natural sunlight only also.
Good Luck.