How much would you need to be earning...

[TW]Fox;11567049 said:
That means that, according to your calculations, people on £40k a year couldn't even afford to run a Focus TDCi.

Hmmm.

And as gurdas correctly pointed out why would you buy a house and live on your own? I can't think of anything more depressing. You'd live with your girlfriend/wife, and halve that mortgage..
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Which bit of that do you want to lose?

The income tax?
The council tax?
The food?

Even if you halve that figure.

£750 mortgage
£200 shopping/groceries
£250 fuel
£100 utilities
£100 council tax
£100 car servicing and insurance
£50 sky
£35 mobile phone
£100 holiday money
£100 savings

Leaves you £400 per month spare to cover every other cost, to entertain yourself, to buy household things/consumer goods/clothes. That's assuming you want to live without kids too :)
 
gurdas said:
If you are paying £1,500 a month for 25 years, that's £450k......
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And most of that 450k is interest.

The figure is about right, but most people share a mortgage.

£750 mortgage
£200 shopping/groceries
£250 fuel
£100 utilities
£100 council tax
£100 car servicing and insurance
£50 sky
£35 mobile phone
£100 holiday money
£100 savings
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Id be looking at why i was spending so ruddy much on fuel a month and car servicing!

Other sound about right, but you dont have to go on holiday, and if you do it doesnt need to cost £1200, can go plenty of places for half that.
 
[TW]Fox;11567142 said:
£250 a month on fuel? £200 on shopping for one person? £1200 a year for one persons holidays?
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Easy enough to get through a £62 tank in one week. £1,200 is not an awful lot to spend on holidays including all your spending money.

So you think you could live on less than £50 worth of food and drink? £7 spending money per day?
 
my dad has just spend £43,000 on a jaguar xj, he doesnt earn near £150,000.
however he has paid off all his mortgage so doesnt really have any expenditure apart from his the shop we own.

i'd say it depends on how settled you are, if like above you have a mortgage and a lot of out goings then it would need to be quite high, id say around £75,000 but if you are settled then it can be quite low
 
Muncher said:
Easy enough to get through a £62 tank in one week. £1,200 is not an awful lot to spend on holidays including all your spending money.
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£250 a month is the sort of money you spend when you are doing 20-30k a year! And £1200 for a holiday on your own? Really?

So you think you could live on less than £50 worth of food and drink? £7 spending money per day?
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£7 a day from Supermarkets etc etc goes quite a long way!

This whole list of calculations is irrelevent really becuase very few people buy a £200-300k house and live in it on their own. You move in with a partner and share costs - and food costs for two are not double food costs for one.
 
There's also the fact that people with a 40k car don't just suddenly go out one day and decide to blow that much cash on a car. They've usually spent years building up from cheaper cars getting something more and more expensive each time and will be funding a good chunk of the purchase price of the new car by selling off their previous one.
 
Well, speaking from personal experience, I'm considering a mid-high 20's 2nd hand car purchase in cash that would equate to approx 32% gross income p.a. And I'm having serious trouble justifying that!

As for affordability....just depends on where your priorities lie.
 
For me, I don't have a house to look after, I have a small rent to pay, I am single (through choice...cause I am selfishly after a new car!), I am unlikely to spend money on a huge holiday. On my salary this allows me to save a considerable % towards a new toy and also a house deposit.

Hence why I can justify spending £10-13k on my next car outright. £40k, I would have thought you would need a sustainable job which covers all your basic assets and usually this includes supporting a family.... so they must have a large salary to be able to do this?
 
imo a yearly salary of around £100k would be needed for a £40k car in most normal circumstances.
 
Muncher said:
The people I know who have their heads screwed on right and spend that much on a car are taking home £140k after tax.
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So over 10K take home a month to afford a 40K car? There's being careful with your money and theres being tight ;)
 
[TW]Fox;11567142 said:
£250 a month on fuel? £200 on shopping for one person? £1200 a year for one persons holidays?
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£250 a month of fuel, easy if doing 1600miles+ a month. 40 mile a day commute plus personal stuff at weekends.

£200 on shopping, again not that difficult especially if you get a few CDs in the supermarket.

£1200 on holidays, not really my thing, but even my two trips to Le Mans this year will get close to £1000 once fuel and spending money are factored in. My lodger probably spent close to 3x on holidays for himself but then he did tend to do things like 16 days in Egypt and 14 in South America.
 
There are far too many variables to make any kind of accurate judgement here. You can get car loan, a leasing scheme or buy it outright, and as for other outgoings, it's never as simple as:
£40k salary = £225k mortgage. I'm on £40k but am lucky to have only a £60k mortgage (dur to inheritance). I have one car-nut friend who's spent a small fortune on cars over the years, but another who earns similar money but would never consider it.
 
I earn 129k a year, I found it very easy to drop 80k on a car.
Saying that, i don't have any children yet and my mortgage costs peanuts if I lived in a big house and had a couple of kids, it would probably be a different story.
 
It would be impossible to say. I know people earning over 100k who drive in Fiat puntos and other people who earn 40k driving 20k cars.

Its all down to personal circumstance.

For example if i was earning 50k a year but my house was bought for me by my parents i would be able to afford a more expensive car than somone on 80k that has a mortgauge etc.
 
Its not anything to do with how much you earn, but how much disposable income you can plough into a car. Typically I might go with these figures:

40K car, of which perhaps £30K needs to be financed over say three years. So that's £900 a month roughly. Then allow perhaps another £300 a month average for consumables, servicing, things that go wrong, tax and basically everything except petrol.

So if you've got £1,200 a month spare out of your net salary then you could probably afford to buy and run one I reckon. whether you have £1,200 a month spare dispoable income is dependant on you and not just your earnings.
 
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