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Werewolfdad t1_iuj98hx wrote

Depends on how much you're saving. For many people, that would be egregious (especially if it doesn't also include utilities)

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Remarkable_Cut3846 OP t1_iuj9mdx wrote

True. For more context, it’s about 25/25 split with car and house expenses… savings would likely be around 20 %

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betterbub t1_iujaey5 wrote

Wait your car payment is a quarter of your income?

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Werewolfdad t1_iujbncd wrote

That’s a lot of car

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Remarkable_Cut3846 OP t1_iujc2wj wrote

You’re right, granted I haven’t pulled the trigger… just wanted a second opinion

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Werewolfdad t1_iujcit0 wrote

Locking yourself into large debt payments backs you into a corner if anything goes wrong in your life or if you need to make some of change due to an unexpected event. I’d advise tying up half your after tax income in debt payments

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trilliumsummer t1_iujc9mn wrote

I would be looking for another trigger to pull. A car is a depreciating asset. I would not be spending 25% of my income on it.

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[deleted] t1_iujak86 wrote

[deleted]

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Remarkable_Cut3846 OP t1_iujb37g wrote

Yeah my bad, assuming no other debt besides a mortgage which is roughly 24% of after tax. Currently 25 making 60 net. Putting away 10% in 401k

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theoriginalharbinger t1_iujjz8h wrote

Always put absolute numbers in - we can figure out percentages from absolutes, but the inverse is much more difficult.

60 net = 5k/month, a quarter of that would be 1200 on a car.

Yeah, that's a terrible idea.

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jokerfriend6 t1_iujl0y5 wrote

You will be house and car poor. 1/8th your gross income on mortgage and 1/8th your income on car+car insurance. That should be a budget that should allow you to 15% your income for 401K

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Grevious47 t1_iujzviu wrote

Hard to say because I have no idea what gets you to your after tax income or what your income is.. Someone asking this question making 180k gross but after maxing out their 401k, child-dependant FSA and HSA would be very different from someone aaking this making 100k with no pre-tax contributions whatsoever.

Thats why typically you should give percentage of gross, its more comparable.

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