What types of folks tend to own luxury cars? At the end of a BusinessWeek article about the struggling Lincoln brand, I ran across this chart detailing the median income and age of the respective owners of each major luxury brand:
Age
Overall, this a bit older than I would have guessed for a median age. But since wealth tends to increase with age, I suppose it makes sense. BMW and Audi has the youngest crowd, with Lincoln and Cadillac with the oldest.
Income
I wonder if the JD Power survey asked for individual or household income. According to the 2005 Census, a household income over $100,000 puts you in the top 15% of the country. A household income over $150,000 puts you in the top 5%.
According the the chart above, the median luxury car owner is easily in the top 10% of income. Is it just me, or does it seems like a lot of people who drive such luxury cars aren’t making six figures? You can lease a BMW 3-series or Audi A4 for $400 a month. That makes for a lot of very high-income folks on the other end of the curve.
Education vs. Income?
Digging into the education numbers tells a different side of the story. About 25% of the overall US population has a 4-year degree or higher, which is actually about the same as the median luxury car owner. Meanwhile, the overall median household income is $45,000, and only rises to $73,446 if you have a Bachelor’s degree or higher (2003 census).
Therefore, while the median luxury car owner is about as (formally) educated as the overall population, they make triple the income versus the overall population, and still double the average of people with 4-year degrees or higher. I find that interesting.
After running some numbers, simply owning a luxury brand don’t necessarily mean that much. A person who leases a Toyota SUV every three years spends more money in the long run than a person who buy a Lexus and drives it for 10 years. Another example… let’s say an Acura costs $15k more than the Honda counterpart. Over 10 years, that’s a premium of $1,500 per year or $125 per month (plus slightly higher maintenance and insurance costs). An iPhone family plan costs more than that.
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If you’re keeping the car for 10 years anyway, does it really matter whether you get the Honda or the Acura? At the end of that time, the luxury features of the Acura won’t seem worth that $125/mo premium you’re still “paying”. Think about it – 10 years ago, an in-dash nav/entertainment system probably wasn’t even an option in an entry-level Acura. Today, you can get one in a used Kia.
I would be very curious to find out how many of the 10-year old luxury cars that we see on the roads are still being driven by their original owners, especially if that figure could be compared to more affordable alternatives. Are there really that many luxury car owners who are really just well-dressed value shoppers?
It’s not that surprising to me that the average luxury car owner is no more educated than the regular population. Luxury cars seem like a waste of money and a poor value for your dime. I wonder if some people get it to flaunt their wealth, and I imagine college educated people are less inclined to do that.
Also isn’t it relevant that the average luxury car older is so old? I would think that in the 60s and 70s less people went to college anyway. I think it was easier to get rich without a college education back then.
If this is the income of owners does that exclude those who lease as they do not own the car?
This doesn’t mean that the luxury owner has approximately the same level of education as the overall population – just that the percentage of 4-year degrees is the same. Post-graduate education is not included.
And I’m not sure why you picked BMW for the headline. Audi tops it in both income and 4-year degree percentage with average age the same…
These fiqures must be considered based on sales of the brands top line models. The increase in sales in the past 15 yrs has been based on luxury goods making entry level products, that goes for most all luxury brands from Mercedes to Tiffany’s. I think the most volume of sales are the entry level so it just seems to me that this fiqures have to be based on more then just overall sales.
An auto is usually never a good financial investment, it is more of a personal luxury. There are many who drive luxury vehicles that have no business owning them, I would bet the percentage of those drivers would be about 50%. The bad thing in todays world is people are judged too much by thier possesions.
These are the owners of only “new” luxury cars, I assume? I bet many drive “used” luxury cars.
Since the percentage of the college educated group is about the same as the national average, I guess most high-income-with-no-college-degree tend to own these luxury cars in order to raise their confidence, status, and self esteem.
It reminds me of the findings in “The Millionaire Next Door”, millionaires don’t drive luxury cars.
What do u mean millionaires don’t drive luxury cars?!? Are you crazy!! What do u expect someone who has 20 mil in the bank to drive a beat up Toyota??? I live in a very high income area in Miami where the cheapest condo is a million dollars and pretty much all you see is luxury cars!
If you are talking about the person who barely has a million dollars including all there investments and possessions then that might be true. As a million dollars is nowhere near enough money to retire!!!
But when u talk about true millionaires who have millions in the bank plus investments of course they drive a luxury car!
I suggest you read the book THE MILLIONAIRE NEXT DOOR or google the book w companion search for “cars” or “vehicles.” You will be surprised!
I know your comment is old but I had to comment. It made me chuckle that people are challenging first hand experiences of those who live in wealthy areas or work with high income people by referencing a single book. Sorry but multi millionaires who dresses “poor”, drive beat up cars, and live in regular homes far below their means is not the norm. It’s simply an over exaggerated anomaly that makes regular income people feel better. It feels better to convince yourself that the wealthy live just like you; they don’t.
I find it amazing just how many purchases people make because they feel like they “deserve it.” Their perception of how much a large income leads to them saying to themselves, “Look at me, I make X or am a Y and I deserve an Audi.” (Y often being lawyers and doctors.) And as you said, the extra money for a luxury car is about the same as people spend on other luxury items (cable and phone and eating out come to mind). So my opinion is that people should go ahead and spend their money on their luxury items if they want, but don’t fool yourself into thinking that you are rich because you can afford a luxury car.
And if they are not saving enough to retire because of their luxury spending, just think of how many more years they will have to work before they retire. Is it worth it? They get to decide….but I doubt many of the ones who are stretching to afford a luxury car do think about it.
Your closing statement had me questioning myself for driving a modest brand three year old car for another 6 or 7 years, when I could just pay the ‘small amount of an iphone’ premium a month and upgrade to a luxury vehicle…..Than I read WES comment and seem to agree, that might be fine paying the extra premium now for the luxury, but in 6 years it would be like paying iphone monthly cost for a razor for the next ten years.
There are people straight out of college driving BMW, let’s face it, everyone wants to be or appear rich
We purchased a brand new 2001 Lexus ES 300 over 10 years ago, and we still drive the same car today. I bought my Ford Probe GT brand new in 1994 and drove it until the UPS Man decided to total out my car in 2005 while it was parked on the side of the highway. I now drive a 2005 Scion xB that I plan to drive until the wheels fall off. I typically only buy another car when my current car costs more to repair on a monthly basis than a new car payment.
As for folks driving new Luxury cars every few years, I wonder what their retirement and savings accounts look like. One of the most richest attorney’s in our city drives a Ford Taurus! Ross Perot, when he was running for President, was driving a Buick.
A moment for statistics.
I just wanted to point out that the age of the vehicle owners is not, as you write, a median, but an average.
I don’t think a lot of people above 80 tend to own cars or drive them much, which means there isn’t all that much emphasis on the larger numbers in the dataset. This would mean that the median is probably even higher than the average.
Also, the salaries are given as a median, but this can also be misleading. it is very possible that the salaries of luxury car owners are a lot less spread out over the lower part of the dataset – meaning the average salary may well be a lot higher than the median.
All in all, it’s always difficult to make claims based on only an average or a median, and only by combining both do you get a clear(er) picture of what’s really going on. It’s possible, in this case, that Audi merely appeals to much more focused group, all in the same age and salary range, but Lincoln has a more varied audience. I would be wary of making any larger claims without more information.
4-yr degree as some form of metric is laughable when discerning luxury car ownership patterns. That chart should include the number of cars sold in say, last year and number of cars leased for each luxury brand. That is far more important metric that goes with the annual income than 4-yr college degree.
I have a Ph.D. in engineering but I earn less than many with just 4-yr degree. Again an anecdote does not make a data, but the point is 4-yr degree is just to broad to discern anything.
An M5 at 100k is 3 times more than an every level 3 series BMW. Car brand is just a matter of preference, it simply does NOT make sense to make anything more out of it.
I couldn’t help but think about “The Millionaire Next Door” as I read this. I think there are a LOT of people that don’t fall in to this demographic driving cars out of their league. I am in the demographic above and would NEVER buy a new one of these brands, and in fact have never owned any of them. I have lusted after an M3, but I’ve always caught myself before doing too far down the path of buying a used one. I’d rather end up in the “Millionaire Next Door” demographic.
Hazzard
As a note, Warren Buffett has recently in the past driven a Lincoln Town Car (one of which he auctioned on eBay for charity) and more recently a Cadillac.
Wonder how much he alone skews those numbers…
I love how presenting simple facts can so easily sway someones spending habits (or at least make them feel inclined to do so). I was planning on keeping my next vehicle for about 3 years, I am definitely reconsidering now. Also, I was thinking about buying a super cheap one ($3,000) and then upgrading later (my original “budget” was to finance one for $12,000). What do you think guys?
Hazzard that is not to say that you can never have your M3. That car may not be ideal with your current income, but (you probably know from your readings) you probably have time to increase your income, unless you are near the end of your time with us on earth. I am working on increasing my income right now with (e.g.) doing side deals on ebay.
Why isn’t there a column in the chart for a****** quotient of the owners? BMW would be off the charts, and Audi not far behind.
Seriously, my point is that luxury car owners often buy for personal reasons that have little to do with income (i.e., wanting a daily driver sports car for BMW/Audi, or communicating to their friends that they are successful for Mercedes/Lexus). To an educated buyer, a Lexus is merely a Toyota with a nice paint job and leather seats. I think income is only a minor consideration when it comes to vehicles, as they are functional tools, a hobby, a social comment, and a status symbol all at the same time.
I myself wouldn’t buy a BMW because of their horrible image (which gets you treated like a jerky BMW driver in traffic even if you are not a jerk…) and snobbish marketing, even though I probably fit into their target market.
Hmm. Lots of misinformation here.
1. Nobody driving a BMW appears rich. Or believes they do in 2010. Everybody knows BMWs can be had on lease for less than most SUVs cost more per month.
2. Used cars are the best deal. No arguments there.
3. There are many tricks for getting into new BMWs dirt cheap – we’re talking 5 series for under $400 a month (european delivery is one way – 15% off MSRP, manufacturer supported leases, membership in BMWCCA, thus a 1k rebate).
4. Not all people buying BMWs do so to send a message. I’ve had 3. I currently have a Mazda3. My wife has an Audi we bought used (practically stole it from the previous owners). We buy what we like as some of us really do like driving. A lot. Where some spend on furniture or gambling, we have always gone toward cars we enjoy driving (to point of going to weekend track days or drives across europe).
You can still save, fund a retirement, own homes in socal and own cars you enjoy. It’s possible.
Amen BGDC!
Seems to me that @John 6:27 seems to have an issue with class envy.
Sorry John but your view just does not hold water. YOU may think people driving a BMW are a$$holes. Thats your problem not theirs.
It also depends quite a bit on what area of the country you live. In Boston, BMW is prevalent. They are everywhere.
I own a BMW X3, and I would hardly call it a “luxury” car. It is pretty bare bones on options too. No built in NAV, no high end stereo. Its a very nice ride, and a very nice SUV. This is my second BMW, and I will never own anything but a BMW from now on. For me it comes down to safety, handling and performance.
I survived a very nasty 5 car pile up on I-90 East in 2008 in my first X3. I was amazed at how safe I felt throughout the whole thing. All the safety systems worked perfectly. Any accident where airbags go off, and ALL of mine did, is a bad accident. BMW has an amazing set of safety systems built into their cars. I do not feel my other car, a VW Jetta would have had anywhere near the same level of protection.
Its also interesting to note, per the sales person at my dealership, that 80% of all BMW’s on the road are leased. When I bought my X3 the sales person could not believe I wanted to buy my car. He kept explaining that everyone leases a BMW. I told him three times. I am BUYING this car. Wrote the check, paid in full no lease, no loan. He thought I was crazy. Also I should note I did not purchase the car new. I bought a 2008 Model X3 that had been in service for less than 10 months. Previously had been leased to a person who could not afford the lease. It had only 8,000 miles on it, and I got it for a song at $17,400 off the MSRP.
@John, you are entitled to you opinion about BMW drivers and the perceived “horrible” image that goes along with being a driver of a BMW. However, you are really only showing that you are just jealous, and envious, which to be honest are both traits that make you a lesser person than the guy sitting next to you at a red light in his bimmer.
@Chris in Boston: Only people who can’t afford a luxury car will be “jealous”, most of us here can go buy a brand new BMW in cash as soon as today. We choose not to because we’re rational savers/spenders and don’t justify the higher price tags for the same “four-wheel” machines.
It’s great for people like you who truly value the luxury cars “and” can afford them but, as you know, most of the luxury car owners are debtors who can’t really afford them.
I agree with bb when he quoted, “The Millionaire Next Door” – millionaires don’t drive luxury cars.
When I see a new BMW or Cadillac driving down the street I don’t assume these people are making over $100,000 a year because nowadays, most people lease cars. I think that luxury cars are just for show and truthfully most of the people who are driving them couldn’t afford to buy them.
Any wise person wouldn’t be buying a “new” car of any kind. Used is definitely the way to go. In fact, I wouldn’t mind getting one of those leased BMWs that people drive for 2 or 4 years at about a 1/3 of the price that they leased it for.
There are lots of high income household. In 2000, there were about 100 million households. 5% of them would be 5 million households making above $150,000 per year. If they buy a new vehicle every 5 years, then 1 million household making over $150,000 would by a new vehicle every year. I realize that they don’t all buy luxury cars (think Sam Walton) or even cars (think SUV) but that is still alot of high income households buying cars.
Laughing at the guy with the Ph.D. that doesn’t know the difference between “too” and “to”:
“…but the point is 4-yr degree is just to broad to discern anything.”
Parked cars on and off in college. I figured the tip said more about people than the car. Some minivan owners would drop you a 5 and some BMW owners would give you a buck. Sometimes vice versa. Some people are rich and flaunt it, some don’t, and others pretend. Car alone doesn’t tell the story.
Chris in Boston Says: “@John, you are entitled to you opinion about BMW drivers and the perceived “horrible” image that goes along with being a driver of a BMW. However, you are really only showing that you are just jealous, and envious, which to be honest are both traits that make you a lesser person than the guy sitting next to you at a red light in his bimmer.”
Someone seems to be both ignoring the topic at hand and protesting too much about a simple fact. The BMW a**hole reputation goes back to at least the early 1980s, when BMW ran “flash to pass” commercials on TV. You could probably find the commercial on Youtube now. Commentary OF 25 YEARS AGO was to the effect: “We know that BMW drivers tend to be aggressive, but should the company reinforce that image with their own marketing?”
The a**hole stereotype has often been parodied, such as within the last couple years by the BBC TV show “Top Gear.” The BMW driver is often described as an uptight type-a personality, acting entitled, and being generally pushy. Sorry to break the news to you and seemingly ruin your self image so easily…
I’d be willing to buy a Porsche or several other straight sports cars in a flash. The fact that BMW has a poor reputation has nothing to do with class envy, and I am by no means poor.
Reality is that when you drive down a road in a BMW, those around will slow to the speed limit, block you, etc. Just the facts again. You may not even be aware of the difference if you have spent most of your time in a BMW. I’ve seen some BMWs with Honda logos as a disguise. Honestly.
John said: “To an educated buyer, a Lexus is merely a Toyota with a nice paint job and leather seats.”
The paint job and leather are actually NOT the main differences – the paint is usually a standard Toyota color, and leather is an option on many Toyotas. They are often built on the same base, but there is a lot more than that to a car.
I have owned several Toyotas and am currently on my second and third Lexuses. If you know how to deal, and pick the right time to buy (January 2010 was a great time btw – lots of luxury cars coming off lease and no-one brave enough to spend money), a secondhand Lexus is not much more expensive than a secondhand Toyota. And if you want some of the options (which are standard on Lexus), it’s a no-brainer.
Being a bit frugal myself, I almost gagged on the justification that a luxury car is “only an iPhone plan more expensive than a normal car”. Isn’t that the very opposite of what we should be thinking?
Have they done a study to determine what still driving a 1990 Geo Prizm says about the driver?
Uh…. never mind. I don’t want to know.
@John,
You are aware that Flash to pass is a common courtesy in Europe?
Drive on any highway through Germany, Austria, France, Italy, Belgium, etc etc… Drivers there know that the flash signal is a common indicator. This is hardly proof that BMW drivers are assh0les as you describe.
“protesting too much about a simple fact” ?? Please… there is no “fact” its an opinion, or a perception. Not a fact.
Mark wrote: “The paint job and leather are actually NOT the main differences – the paint is usually a standard Toyota color, and leather is an option on many Toyotas. They are often built on the same base, but there is a lot more than that to a car.”
The reality is that in an era of platform sharing you really aren’t getting that much of a mechanical difference with many luxury brands. The luxo models will have bigger engines and more gears and they have many more twiddly bits like navigation units, but the chassis is the same and most of the guts are the same. However, SOME manufacturers go to great lengths to make you think similar products are different.
Underneath that Cadillac SUV is just a Chevy/GMC truck. Underneath that Hummer (RIP) was just a Chevy/GMC truck. Yes, both Cadillac and Hummer made quite a few modifications, but per Marketing 101, they added a little bit in cost over Chevy/GMC and charged a lot for the “elite” brands. Lexus and Toyota are close cousins too–and mimic the GMC approach to branding.
GMC took this approach to a cynical extreme during the boxy clone car era a couple decades ago–with slight changes to one car across 5 different brands. I recall the clueless Cadillac stylists after proudly introducing a new model…which was so much like other GM products that buyers just ignored it.
Some luxury brands don’t have a low/high split so value comparisons are harder to make.
For your other point, I wouldn’t hesitate to buy many used luxury cars for the right price, and yes it is nicer living day to day with luxury features than basic features. You also get to deal with a better dealership, etc. Just be aware of what’s going on–particularly in the new car market–and don’t be a victim of marketing.
I drive a 96 BMW Z3. Bought it used with 17K miles when it was 2 years old for half the 34K sticker price. I figure the original owner paid a buck a mile to drive it. The car has been cheap to insure, gotten almost 30mpg and been bullet proof for the past 12 years. I usually take the train and put few miles on my car. It now has only 96K. My wife has a CR-V which is our main vehicle.
The car is now probably worth five thousand, yet I often get treated like some kind of rich snob when I drive up in it. It’s unfortunate because I’d never want to make someone else feel bad.
In short, “luxury brands” don’t have to cost too much to drive if you are content to buy used and keep for a while, plus they are very enjoyable and rewarding to drive.
MT Wrote:
“As a note, Warren Buffett has recently in the past driven a Lincoln Town Car (one of which he auctioned on eBay for charity) and more recently a Cadillac.
Wonder how much he alone skews those numbers…”
@MT, a few extremely high earning individuals shouldn’t skew a median number within a larger group.
This chart has median income, not average income. So any Buffett’s on the list would be given reduced importance as an outlier. Most of the time outliers are thrown out all together. It is odd they have median income together with average age. They should have done median for both fields of data.
As for the flashing of headlights discussion, its not common practice in the US but it is in Europe. If you are going slow you’ll get flashed by everything from a VW to a BMW. I’m not sure what John’s problem is but there is a definite chip on his shoulder about BMWs. Maybe its the cities I’ve lived but BMWs are a common car seen as much as you see a Ford in the Midwest USA. I don’t notice any more jerk BMW drivers as jerks in other vehicles.
The age of the driver, not the manufacturer of the vehicle, would be a better determining factor in whether the owner is a bad driver. Insurance companies factor this into the formula for determining cost of coverage which is why very young and very old drivers pay more for auto insurance. There are actual facts that can back up age and accidents or citations. But no facts that show BMW means a certain negative attitude on the road.
Based on the comments, there seems to be a lot of stereotyping and assumptions being made. What someone drives does reflect s bit about them. Personally, I prefer a car with good safety ratings, great design, good performance, run flat tires and zero maintenance. BMW is the only model that fits my personal requirements. If another manufacturer (ie. Ford) can meet my requirements I would definitely consider picking up a Ford.
Most of my friends drive a BMW, have high income, and have at minimum a 4 year degree (we are all between 25-35). I wonder what assumptions will be made from my previous sentence. Or if there is something to the article from BusinessWeek.
BMW is “good stuff”, although I had some bad experience with it, may be just unlucky. When the author chose ” BMW=…” as the title? it makes me wondering, what’s the story behind BMW? Is it the best selling luxury brand in USA? Or “BMW’ somehow sounds sleeker than Audi then Benz?
Yes, BMW is the world’s top-selling luxury brand and a well-known symbol of luxury cars. Must be why this post still gets traffic so many years later!
Silly: this thread proves that people all have hangups on something and stereotypes never die, they just get worse after you get out of high school. =]
Luxury cars are a steal if you know how to shop for them and do not lease them. You get EXPONENTIALLY better service at most luxury dealers ( not always but generally) for servicing your cars. Though i never service at a a dealer unless under warranty since labor and parts are usually double that of a trusted local mechanic. but no one can tell me that its not worth spending a bit more to have amazing comfort and safety when i spend 15 hours or more a week in my car. And i second chris in boston: I’ve been in a couple of terrible no-fault winter accidents and i will never drive anything but the best-built cars again. If they are american , all the better (Ford is doing great things) but right now, they are not!
Perfect example: my brother in law whose unbridled nastiness regarding my luxury certified preowned car for which I pay 1/2 as much per month to *own* than he does for his *leased* SUV… My car costs less than his boat, less than his minivan, less than his camper, etc. ( I own none of these) But marketing has made stereotypes stick and I’m the rich a$$ for driving it. =) also would love to see sample size and data set for these findings. They have to be household income and reflect non-leased vehicles. I know many many people with luxury cars, and though a couple are of course living beyond their means most are absolutely frugal and thrifty, and make NOWHERE near these amounts…
The high incomes really surprise me. I know in many cities, young professionals who have decent jobs drive BMW 3 series, Benz C class, etc.
My what an interesting blog. The comments are hilarious, so many judgemental people out there aren’t there? Very interesting how people who blog seem to think they are more “enlightened” than the rest of the “stupid” population… Unfortunately, people’s buying habits shouldn’t be attacked. We all have different situations and scenarios for buying luxury.
Millionaire next door – read it and thought it was interesting. Spending preference can also be a generational thing too don’t forget that one, readers! I’m mid 30’s and have a net worth of a little over $1 million. I have a masters degree and a great job – I have no debt and started saving money when I landed my first corporate job at the age of 22. I invest well and have quite a diverse portfolio. I have a beautiful home with a 4% fixed mortgage and 50% of it is paid off already…However; I do like some luxury in my life.
I’ve leased BMW’s for 10 years now and I own a 5 year old Acura that I bought brand new. Why do I lease BMW’s – because I love driving them! Some people like vacationing on the beach, I like driving them. I don’t buy them because I enjoy new technology and have you ever seen the cost of maintaining a BMW once it needs REAL repair work? It’s insane, I have no time to deal with repair work. My next lease will be an M3. Those are REAL FUN to drive!!! I wouldn’t want to own it though, I just want to have fun driving it for 3 years then I”ll give it back. And to the guy bashing Acura owners – I used to own Hondas in HIgh school. Three of them were stolen from the apartments I used to live in. I vowed to NEVER buy a Honda again. It wasn’t that Acuras are more secure, it was tied to bad experiences in my life. Ever listen to Suze Orman – she always talks about money being an emotional tie to things we own… try listening, it’s true! Anyway, I don’t like the interior of the Hondas. They actually feel different than the interior of the Acuras – including dashboard layout. While Mr Acura basher doesn’t know the difference, I DO which is why my buying preference is Acura. Also every Acura dealer I’ve dealt with has been truly STELLAR – complimentary deals all the time and they never tell customers “no”. I will pay for great service and that’s what I get at Acura…as well as BMW.
Some of you sky dive or go bungee jumping, I like driving different cars.
Now the rest of you can say that I’m not “financially” smart for “wasting” money – in the end who’s life is it anyway? It’s mine, not yours. My retirement is taken care of and I have no debt, I give generously and don’t point my finger at those ladies who like to buy $2000 purses.
To each his own, be happy for other people. Who are any of you to judge?
Thank you, Happy Girl. People can spend their one whatever they want.
While John here points his finger and calls BMW drivers a-holes, the hippie on the scooter points his finger and calls John an idiot for even buying a car.
The point is that people buy luxury cars for many reasons. Do some of them buy cars they can’t afford? Yes. Do some of them buy cars they can afford? Yes.
@Happy Girl
Seriously you do know that Acura is a Honda right?
I agree that you get what you pay for and service one of them. I love driving cars too however I can’t see myself paying for something that in the end I wont own. It’s like paying rent on a car but to each their own. Let me know how the M3 rides.
Kind of an old thread, but many here miss the point. We all have one life to live (to our knowledge). Its smart to save money, but its also smart to enjoy life. I’m on the older side . . mid fifties. I’m in great health and shape but figure I will be lucky if I eek out another twenty years of good health. Worth maybe 2.5 million. Just got a great deal on the last of the e90s, 328i. Bought brand new, but avoided Nav because did not think it or I drive worth the 2K it would cost and I am happy with a $200.00 Garmin. . But I did get everything I wanted, the premium package, satellite radio,etc. Car had four miles on it when I picked it up. Drives great. Really didn’t cost me much more than a Toyota Camry or Honda Accord. Actually, trading in my old beemer that I drove for nine years, with the .9% financing over 24 months, AND a tax deduction, I am probably paying less than that new honda or toyota others have bought. I suppose the point is, you can live well and smart without necessarily being a rich a**hole. And no, I DO NOT consider myself wealthy in the least.
I am a younger buyer that really likes the A5… I have saved more than enough money to buy 2 A5s like what I’d like. Used A5s are not a great value at all when purchased from a dealer (if you figure a care lasts for 125 to 150 K miles). I could get lucky shopping around or buying in another state.
So, it’s a tough decision. My subaru is fine, but not has beautiful, quiet, and fun as the A5. They get similar fuel economy. Will buying it make me addicted to luxury? I am not at all rich, but do just fine for myself… I’m single… but what business do I have buying a 40 thousand dollar car?
I could give poop about what other people think… I just love the car. A WRX costs just about as much… it’s a blast, but it’s juvenile, a gas hog, and every bit as hideous to behold as my economically priced outback sport… decisions decisions.
I found the article and many of these comments to be rather silly. Most people simply seem to be defending a shallow and moot view anyway. This is a pretty trivial matter. Luxury or economy car, it is all luxury when compared to little kids in Africa.
I drive a 3 series BMW because it really is a great all around performance wagon. It is nice and has plenty of extras. To some it may seem excessive or posh, but so is a big screen and satellite TV. I get my kicks with driving, but that does not mean I think I am better than my neighbor because she drives a Toyota and I drive a BMW. Let’s get real now.
I have been in the car business most of my life and reading these comments make me laugh. Cars are a impulse buy plain and simple. Whether it is luxury or econo box. People buy what they like whether they overthink it or are just wow’d by the feautures and how the salesman shows the car and how it can benefit there life. You spend most of your life in your vehicle so why not get what you want? If you dont care then go the cheap route. Either way why does it matter? This response thread only shows how with money people overthink things. You cant take it with you, and if you think other people are really thinking about you and your bmw you have alot more to worry about in your life.
I see the stats as: the higher %age of colledge educated, with the most family income, choose Audi. This is brand sucess.
Bmws have some of the best priced leases around. Audi has horrific lease rates.
As to wasting money on a car? I’d say spending 10k on a 2week vacation falls short vs. spending 10k depreciation over 52 weeks of driving a decent car.
Its a selfish indulgence, and in old age there won’t be regrets of never spending on the things that I wanted. Hording your money is a worse sickness than spending whats in the savings account.
To “Audi” above, the issue with your logic is that that the 2 week vacation is likely to bring you wonderful memories for the rest of your life. The new Audi will likely give you a ton of excitement for the beginning stages of ownership, but then it’ll break down, or the features will be outdated, or another new Audi will come out. So your once-happy memories will fade away. So in the end, the car will fall short.
I do agree with your 2nd point though. You don’t need to take it all to your grave with you.
Listen, there are two types of people in this world. Those who can afford to lease or buy a luxury brand vehicle and those who pretend they are far more righteous. I for one, would rather spend the extra money on a luxury vehicle to sit in the Los Angeles traffic, comfortably. Currently, I can’t afford even the cheapest vehicle. I take the bus to work and ride my bike home from work. Nevertheless, I plan to own a BMW 5 series or a Tesla some time in the next 5 years.
I just bought a 2013 528i (BMW) and I have no complaints…..life is short.
I am a 25 year old fairly recently college graduate (within the last 2 years). My father bought me my first car when I turned 16 – a modest Pontiac Grand AM that lasted me through most of 2014. Never had a single issue with that Pontiac and with the way I treated it, it probably could have gone another 2-4 years. 140K miles, but the damn car ran so well I was actually hoping it would just croak sooner or later. Alas, last month I fell in love with a 2010 CPO Acura TSX and decided it had to be mine. Purchased it for 18K, MY very first car purchase that left me satisfied and proud of my self. Sure, some might say it’s only an Acura, or on the other end will call me a show off, but the thing is I’m still young, I make a good salary for my age group and I have relatively no debt. I don’t worry about what others think because they’re not the ones paying my bills and as long as I can pay my bills while continuing to save/invest in my future, I’m going to make sure I have fun along the way. To each his own.
Typo on my comment. It is a 2012 TSX**
It’s hard to believe that an American made piece of junk like a Pontiac Grand Am could be trouble free and, miraculously, last over 100K miles?!?!?! That just doesn’t make sense since the vast majority of American made automobiles have shaken themselves apart and are junked in less than a decade.
This really applies to the problematic peices of junk made by Chrysler. I’ve had the biggest nightmare of a owing a 1998 Dodge Intrepid that had an appetite for transmissions, had major electrical issues, brake issues, and its 2.7 liter V6 seized up at 50,000 miles from sludge. I did oil changes every 3K and used synthetic motor oil.
Chrysler was never know for building quality automobiles. And they still live up to that motto of building junk.
A coworker of mine rented a 2014 Dodge Dart last year, while on a business trip, and the Dart’s transmission was behaving erratically, eventually making the car undrivable. He wasn’t exactly a happy camper having to have a tow truck called, etc. while being in an unfamiliar area.
One of the best cars I’ve owned was a 1999 Acura Intega that I bought used. I never had a single problem with my Acura and incurred over 250,000 miles on that little gem.
I currently drive a Nissan Leaf which is an incredible car. It’s not the prettiest thing on wheels but it sure serves its purpose beautifully.
If you plan on holding on to a new vehicle for a decade or longer, your best bet is to always go with Japansese and Korean brands. European cars are very nice but they’re very pricey to repair after their warranties expire, and they aren’t as reliable and durable as the Asian brands.
But at all means stay away from the American brands; especially anything made by Chrysler.
This is a pretty old post but I couldn’t bare to click away without commenting.
In all honesty, cars are a big deal to some people. I’m a car person and I do in fact enjoy different aspects about my car. My 2013 BMW 335i can handle a sharp curve at 65 mph, it can accelerate rapidly, it feels composed and stable on the highway, and the manual transmission is crisp and sharp while the clutch pedal remains soft and easy to use for daily driving. I’m also looking to get new tires for the dry/warm summer months to give me more grip on the road. Some day, I also hope to upgrade the engine and tweak a few more things here and there when I get the time to research what’s best for my car. Of course, I don’t drive like a “jerk” on busy roads or when the weather is bad, but I do try to get the most out of my car.
On the contrary, I would never go out of my budget just to get a nice car. I’ve owned cars in the past that were much cheaper; my Honda S2000, used Acura Legend…
However, for a lot of people, their car is simply just a reflection of their income or job. That’s what I personally think is “wrong” or not “financially wise”. If something DOES NOT give you TRUE happiness, why would you pour out $600 a month on a lease or pay $1,000+ a month to purchase?
For example, I don’t go out to eat fancy sushi or filet mignon because it does not give me true happiness. I don’t feel like I should eat a specific type of food just because my income is much higher than average. I’m perfectly happy with my home cooked meals (I’m a great cook) or the occasional $10 takeout food. I also don’t have the latest iPhone 6 because my iPhone 4 does the same thing, but just a little slower. I really don’t care about phones… As long as it’s a smartphone, I’m pretty much okay.
Even my house is 1.5x more than my annual income. If I can get a nice home in a safe neighborhood for a low price, why not go for it? A big home does not make me truly happy, so I just don’t get one despite the fact that I can get one. My coworkers do 30 yr mortgages for gigantic homes just to match up with their job title and income. Their homes are almost 3x higher than their annual income. I doubt 3 empty bedrooms and 2 unused bathrooms really makes them truly happy.
But then again, it’s not my money. People have the right to spend however they please. If they feel the need to spend 95% of their paycheck just to have flashy nights out and lease a BMW because to “live up to” their job title or income, then go for it! It’s just not my cup of tea.
I also doubt that my coworkers drive nice Audis, BMWs, and Mercedes because they truly enjoy the driving experience. Nowadays, some modern Toyotas, Acuras, Hondas, etc offer a comfortable ride with plenty of tech and leather seats. They’re obviously pouring out money just to maintain their image.
Way to make a simple morning read before work a very interesting one guys. I have always been conflicted on two sides of the spectrum.
At 28, I can honestly say I feel fortunate to have already achieved over a six figure salery. Yet, I came from family income barely breaking 70k. Funny enough, I don’t see myself as wealthy at all and maybe do to the way I was raised, can’t justify purchasing a luxury car . And yet, I see myself as a car enthusiast. I love the elegance these cars portray themselves on the road. Here in Atlanta , they are very common too. My apartment complex alone, which isn’t anything to write home about, has roughly 30-40% high end cars in the parking deck. This would always baffle me. But I guess like what previous posters said, luxury cars are much easier to obtain.
I bought myself a Honda sedan and my bank payment was $400/month for 4 door sedan and it was a Honda LX not even EX. I think I was ripped off. For such monthly payment should’ve purchased a BMW or an Audi instead
The demographics show and I have personally witnessed that as a person reaches retirement age or has become an empty-nester they simply buy what they want. The old phrase “you can’t take it with you” prevails. Purchasing a luxury vehicle IS a status milestone for many people who have made sacrifices to get to where they are now. Price & cost isn’t the primary consideration when you’re 60 and know this may likely be THE LAST vehicle you’ll ever own, so why not go out in style.