Considering an RS7. Lease deal ?

[Awdbeast]

Hello. All. My first post, well second. I'm considering leasing a 2016 RS7. Currently have a 2015 SRT Jeep that has been an absolute blast to own. Problem is she has 24000 miles on it and once the 2017's and possible Hellcat Jeep arrive this will drive down the value more. So I began looking around at used 2014-2015 RS7's. No test drives yet as I think I'll make an irrational decision if I drove one. Only Internet surfing until yesterday.

I strolled into a local Audi dealer and they had a new 2016 on the floor. I noticed they updated the tail lights which I thought looked awesome. Anyway. A new RS7 wasn't a consideration due to price but then I thought what about a lease. So I sat down and we ran the numbers. Keep in mind I have not leased before so I wasn't up on what's a good deal or not.

The opening number thrown at me was a shocker to say the least.
Msrp-124,295
They came down to 119,295
Trade value 48k which was way too low for my Jeep as I was offered 55k trade earlier that day at the Jeep dealer.
I owe 38k on the Jeep so was going to put 10k down payment as I have some equity in her at this point.
36 month, 10k mile. 2250$ and month. 44.00 residual value. Crazy I thought.
So after some haggling they came up to 56k trade in on my truck "to make the numbers work", and they offered a 42 month lease , 10k miles 1799.00 a month with first payment plus 10k down payment.

I decided that considering I wasn't up on leasing a felt at a disadvantage due to lack knowledge so I walked out.

After doing some research I see that money factor is an important thing to know. I don't know what they are charging on interest on this deal. Plus with regard to sales tax, do they take my trade in Of 56k and deduct at from the 119295 and the sales tax is on only the difference? Or do they pay off the lean of 38k then take the 10k and deduct that from the 119295, so basically sales tax of 109295.

I took a quick picture of the deal but can't seem to post it up :(
Reads like this:
Msrp - $119295(this was after taking the 5k off)
Cap cost-119295
Sales tax-7123.41
Dealer/state fees(ny)-97.50
New residual-$54689.80(this was on the 36 month deal, no info on 42 month)
Drive off-$10322.67
Program miles - 10,000.
1799,00 a month payment

I know this is a long winded first post but I'd really like to make a deal and any info or advice would be awesome.
My back of the napkin math on what was a fair deal looked like this.
119,295 + 7123.41=126,418.41

126,418.41-54,689.80=71,728.61

71,728.61 - 10,000 down= 61,728.61/42 months =1470 a month payment. I said I'd go 1500. They said maybe they could go 1700 a month but like I said I decided to sleep on it.

Thanks in advance.
I absolute love the way the RS7 looks and hope I can join the fun soon!

[sciblades]

my msrp was 118k i put 17k down and pay 1358 a month did 39 months (danbury audi)

[Dguth]

Man that's a lot of money a month for a vehicle. AWDBeast I also had a 2014 Jeep SRT that I traded in for the same reason as yours. Mine was boosted though with the RIPP stage 2 kit. Really great all purposes vehicle. I too initially wanted an RS7 but the numbers were just too steep. So I did the next best thing. Bought a slightly used S6 and went full stage 3 with it. Never look back at the Jeep. These are phenomenal cars whichever you buy.


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[CanuckRS]

71,728.61 - 10,000 down= 61,728.61/42 months =1470 a month payment. I said I'd go 1500. They said maybe they could go 1700 a month but like I said I decided to sleep on it.

Thanks in advance.
I absolute love the way the RS7 looks and hope I can join the fun soon!

I'm no leasing expert but i have leased many vehicles and the number one thing i can tell you is to NEVER negotiate a lease based on the monthly rate unless you know the numbers inside and out. And by that i mean you gotta know EXACTLY what you are paying for the vehicle (selling price, not the monthly lease payment).

A good place to start your research is here: http://www.leaseguide.com/lease08/

I recommend calculating your lease (with the numbers you have from the dealer. if you don't have them all, make sure to ask them for the info you need.) manually and really understand all the factors involved in the lease. What i also did was to create a lease calculator on my own in excel to make the process easier once i understood the calculations. I also created a spreadsheet so i could use the lease payment to work backwards and tell me the selling price of the vehicle. The reason for this is that not infrequently, your dealer will sell you a car ABOVE MSRP by confusing you with lease payments, money factor, trade-ins etc... Their job is to screw you out of your hard earned money, they take courses for this kind of shit so you are at a huge disadvantage. The last time I leased my RS7, I brought my laptop in with me and had it open on the desk with my excel spreadsheets to make sure i wasn't getting taken for a ride. Trust me, even with the excel spreadsheets i was amazed at how they still tried to screw me over. They were Shocked i say, just Shocked at how their calculations were so far off of what i calculated on my end. They have a computer on their desk for this crap, why wouldn't you? Take my advice or don't, just my 0.02c :)

[QuaTTrings]

Nice, hope it works out! I can add some things as I l looked into the rates recently. Lease rates for any RS car are absolutely horrible. AFS charges more than 5%(or 6%) interest (based on their money factor) and a pretty awful residual as well. You can get an additional 1% on the residual by purchasing Audi Care Maintenance if you plan to have the car for awhile. Still compared to competitors, Audi's 50% rated residual is not realistic for this vehicle but it allows you to be ahead and not under water later in the term. Have you looked into an outright purchase? You will find that it is normally a better move on an RS car with a much better interest rate for about the same price what Audi charges for their lease. Your dealer may give you the option to use different banks that make Audi's lease rate a very bad deal. If you do decide that a lease is for you, just do the drive off and don't put a penny extra down, as you are taxed on that down payment, unless of course you can write the payment off for your business. Your Jeep as a trade will offset the payment and is not taxed in the same way as a cash down is on a lease.

One good thing, is that sales of expensive cars seems to have slowed down in recent months. Not sure if it's the economy entering a recession or not but the same RS7s are sitting on lots for months at a time and as a result, RS7s are being heavily discounted at the moment (I've seen some that are $8-9k under MSRP and those cars are still on the lot). Don't limit yourself to that one RS7 if you don't like the deal that they are giving. Almost all dealers are willing to deal on this car which is a huge change from a year ago when they were selling for virtually MSRP.

Here are recent AFS rates for 36 and 48 months: (36 months is the sweet spot)

36 months:
- Money factor: .00233 ( 5.592% )
- Residual for 7,500: 49% of MSRP

48 months:
- Money factor: .00253 ( 6.072% )
- Residual for 7,500: 42% of MSRP

Hello. All. My first post, well second. I'm considering leasing a 2016 RS7. Currently have a 2015 SRT Jeep that has been an absolute blast to own. Problem is she has 24000 miles on it and once the 2017's and possible Hellcat Jeep arrive this will drive down the value more. So I began looking around at used 2014-2015 RS7's. No test drives yet as I think I'll make an irrational decision if I drove one. Only Internet surfing until yesterday.

[Winterk80]

Is the buy interest rate different than lease, is that what you are saying?

[QuaTTrings]

It's substantially better. If you have excellent credit, there shouldn't be any problem getting a 2% interest rate on a 60 month term. (Likely not with Audi Financial but through a different bank that the dealer will most likely offer)

Is the buy interest rate different than lease, is that what you are saying?

[antoff83]

Leasing an RS7 is not good idea based on its lease rate(money factor and residual) They are just hideous(like most Audis). Also putting large amount of money down on alease is not good idea..if vehicle gets totaled/stolen you loosing those $.

If you plan to put down that type of down payment the best way to go is finance.

I heard there is a bank called PenFed which offer crazy low APR's. they can get you term up to 72 months I believe. But if you still interested in lease Edmunds is good source to educate yourself and even get lease quote based on numbers dealer got you.

here is the link: http://forums.edmunds.com/discussions/tagged/audi/audi

good luck!

[Avned]

Leasing an RS7 is not good idea based on its lease rate(money factor and residual) They are just hideous(like most Audis). Also putting large amount of money down on alease is not good idea..if vehicle gets totaled/stolen you loosing those $.

If you plan to put down that type of down payment the best way to go is finance.

I heard there is a bank called PenFed which offer crazy low APR's. they can get you term up to 72 months I believe. But if you still interested in lease Edmunds is good source to educate yourself and even get lease quote based on numbers dealer got you.

here is the link: http://forums.edmunds.com/discussions/tagged/audi/audi

good luck!

Penfed and Digital Credit Union (DCU) are my go to banks for financing. Great rates and flexible terms. I agree that considering the numbers you have posted, financing is the way to go. I would go CPO or slightly used and use that cash for mods. Which is exactly what I did with my S6. Good luck!

[Stan77]

Now i understand why so many RS in the states ) You're not buying cars, you're taking it for long-term rent ) May be it sounds wild for you but i paid for my a7 in cash =)

Wanted to say that 5%discont for audi in stock is nothing, EU dealers going up to -20% discount on cars in stock, espessially on something expensive like RSes

[Awdbeast]

Guys. Thanks so much. I am going to rethink this whole thing. I bought my jeep on a 72 month loan from,light stream. I got a pre approved loan before even looking for the truck. 2.39% rate(it's higher these days unfortunately) . What I like about this route is I had unlimited mileage use and the payment was low. This allowed me to have a low payment which most times I sent in far more than the minimum payment. I like the flexibility of this method. I think a CPO car going Using this method may be the better route. Maybe buy an extended, transferable warranty to boot. Much appreciated for all the quick responses. Jim

[McFuzz]

Now i understand why so many RS in the states ) You're not buying cars, you're taking it for long-term rent ) May be it sounds wild for you but i paid for my a7 in cash =)

Wanted to say that 5%discont for audi in stock is nothing, EU dealers going up to -20% discount on cars in stock, espessially on something expensive like RSes

In Mother Russia you pay in cash because Mother Russia does not have the same financing deals as we have in the US. I am not too keen on leases but you can make a lease work in your favor if you simply know how to play the game. In terms of buying, though, we can get loans for up to 7 years with a rate as low as 1.79%. Imagine buying a $100K car and paying $1,268 a month on that; total finance charge is $6,512 for the duration of the (7 year) loan. Break that down per year and that's $930 a year to finance the car.

Now imagine you decided to finance the car (100% finance - yes you could do that) and put your $100k into a money market account with an average yield of say a modest 4% compounded yearly (now of course these numbers are wild but this is for the sake of the argument). At the end of the 7 years you paid $106,512 for the car but your money market has $131,593.18 in it. Lets subtract 106,512 from 131,593.18 and that's a net of $25,081. On top of that, your 7 year old RS7 is now worth 45K so that means you have $70,081 in liquid and non-liquid assets.



What's the moral of the story? If you pay all cash for your car, you will end up with just the depreciated value of the car; finance the car and invest your money = you have the depreciated value of the car AND interest you gained by investing. Also - buying a car, any car, for cash, is not the wisest thing to do in today's economy.

[Stan77]

In Mother Russia you pay in cash because Mother Russia does not have the same financing deals as we have in the US. I am not too keen on leases but you can make a lease work insanely well for you. In terms of buying, though, we can get loans for up to 7 years with a rate as low as 1.79%. Imagine buying a $100K car and paying $1,268 a month on that; total finance charge is $6,512 for the duration of the (7 year) loan. Break that down per year and that's $930 a year to finance the car.

Now imagine you put your $100k into a money market account with an average yield of say a modest 4% (now of course these numbers are wild but this is for the sake of the argument). At the end of the 7 years you paid $106,512 for the car but your money market has $131,593.18 in it. Lets subtract 106,512 from 131,593.18 and that's a net of $25,081. On top of that, your 7 year old RS7 is now worth 45K so that means you have $70,081 in liquid and non-liquid assets.



What's the moral of the story? Buying a car, any car, for cash, is a silly thing to do in today's economy.

I'll break your patterns, but we have good financial deals, loans, leases etc but we preffer to PAY for what we have instead of loan, cause, for example, you loosing your job or downshifting in financing and you can't afford your loan anymore and your car will gone ) I can quit my business, smoke weed and drink vodka 24/7 and my car will stay with me. Good rumor is, everything you own - must be paid. Everything you can't pay instantly - you're not deserve, in my opinion of course ) And believe me, the bill MUST be paid http://www.usdebtclock.org/ This - too ) According to the fact, your dept to the world is ~~60K )

[SlickMachine]

55k residual is absurdly low on that car. Right now you could MAYBE grab a 4 year old S7 coming off a similar lease with 40k miles. Low-balling the residual is obviously where Audi is making money. The only way that works to your favor is purchasing the car at the end of the lease and reselling it for what it will actually be worth at that time...only them could you recoup some money. Doesn't look like a good plan.

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[tonymission]

I'll break your patterns, but we have good financial deals, loans, leases etc but we preffer to PAY for what we have instead of loan, cause, for example, you loosing your job or downshifting in financing and you can't afford your loan anymore and your car will gone ) I can quit my business, smoke weed and drink vodka 24/7 and my car will stay with me. Good rumor is, everything you own - must be paid. Everything you can't pay instantly - you're not deserve, in my opinion of course ) And believe me, the bill MUST be paid http://www.usdebtclock.org/ This - too ) According to the fact, your dept to the world is ~~60K )

If you quit/lose your job and no longer can afford your car -- even if you paid for it all in cash -- the FIRST thing you should do is sell your car, take the equity in cash and go buy a much cheaper vehicle (or don't have one at all). You're going to need the money. No reason to tie up all that cash in a car.

[Audi_Salesman]

AWDBEAST I have two CPO RS7's in my inventory. If you would like some more information please let me know.


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[steeler]

You should really take a look at PedFed's Audo Payment Saver program. It's basicaly a buy but with a balloon payment at the end. It's structured kinda like a lease. ie. you pay for depreciation till the last payment.

[McFuzz]

I'll break your patterns, but we have good financial deals, loans, leases etc but we preffer to PAY for what we have instead of loan, cause, for example, you loosing your job or downshifting in financing and you can't afford your loan anymore and your car will gone ) I can quit my business, smoke weed and drink vodka 24/7 and my car will stay with me. Good rumor is, everything you own - must be paid. Everything you can't pay instantly - you're not deserve, in my opinion of course ) And believe me, the bill MUST be paid http://www.usdebtclock.org/ This - too ) According to the fact, your dept to the world is ~~60K )

That is exactly why you don't pay all cash for a vehicle, especially such an expensive one. If you were to lose your job, you have a huge chunk of money tied into a non-liquid asset - i.e. your vehicle. If you lose your job and you have the vehicle financed - you still have your 100k in the bank (plus whatever interest it has accumulated so far)... that gives you a nice fat cushion to either find a job an weather it out while maintaining payments on the car, or sell the car and take your equity.

Food + Roof over your head + Money to get the former two > car.

[nickrs7]

mine msrp was 135k 5k down 2200 a month with tax 3 years

[McFuzz]

mine msrp was 135k 5k down 2200 a month with tax 3 years

That's more than my monthly mortgage payment :x

[SunDevil]

Leasing works great for BUSINESS write-offs. Not sure for private reasons. When you lease ... you are essentially renting the car. If you rent (lease) the car for more than 36 months .... that is a bad financial deal. You also have to turn the car in "good" shape. Can't be over mileage.

One positive about leases and that I used to drive the shit out of the cars. Never cared about weather, mud, water, etc. etc. These are cars I leased through my business. Personal cars are financed or purchased outright with cash (if possible).

As another poster mentioned. If you are only negotiating with the monthly payment as your basis .... do some research on financing/leasing.

[Stan77]

If you quit/lose your job and no longer can afford your car -- even if you paid for it all in cash -- the FIRST thing you should do is sell your car, take the equity in cash and go buy a much cheaper vehicle (or don't have one at all). You're going to need the money. No reason to tie up all that cash in a car.

Well, it really depends, but, for example, i prefer not to be in a bank's pocket. Investing money in business of course is the good way, but most of us here prefer to have property or things like cars being paid 100% without any loands. If bad times will come, i can just park my car untill i find the way how to solve the problem, otherwise i can sell it quickly with a little discount from regular market price and receive some cash. It's difference in mentality, in sociality between US and RF =) And here i'm not alone who preffer to planning budget according to the fact what we really have without any loands. Not trying to be offensive, just admitting the fact )

[agent47]

Nvm

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[CanuckRS]

Well, it really depends, but, for example, i prefer not to be in a bank's pocket. Investing money in business of course is the good way, but most of us here prefer to have property or things like cars being paid 100% without any loands. If bad times will come, i can just park my car untill i find the way how to solve the problem, otherwise i can sell it quickly with a little discount from regular market price and receive some cash. It's difference in mentality, in sociality between US and RF =) And here i'm not alone who preffer to planning budget according to the fact what we really have without any loands. Not trying to be offensive, just admitting the fact )

Well here's a flip side to that coin. I've had a few lemon vehicles in my time and if i am leasing the vehicle i don't really care about the repair process, as long as it's fixed to their standards it doesn't affect me one way or another. As long as i can pound on it, i'm good. My last RS7 was a lemon and believe you me, it was a big headache until it was finally replaced because i owned it 100%. My new RS7 is now on lease because I learned a great lesson. When i'm done with it, i can just hand it back or i can buy it out and sell it if there is cash to be made, i have a few nice options. Sure it costs a few grand more to lease in general, but to me that's insignificant because of the benefits of leasing i just mentioned but also because i put it through my company which is a very nice tax advantage so in the end it's about even steven. Even if it costs a bit more to lease, to me it's worth it to not have to deal with the general public to sell a vehicle if that's the way i want to go, that's totally worth it :) Besides, i usually change up my vehicles every 3-4 years, so leasing fits my lifestyle perfectly. And I prefer to let the bank be on the hook for the vehicle, technically they own it, not me. If there are any problems with the vehicle, they are the ones holding the bag in the end.

Sure i could buy it outright but as the Rock says, never buy a depreciating asset: if it drives, flies, floats, or fucks....lease it :) Wiser words have never been spoken.

[VeryBadman]

Sure i could buy it outright but as the Rock says, never buy a depreciating asset: if it drives, flies, floats, or fucks....lease it :) Wiser words have never been spoken.

Not sure how we are going to lease "it fucks" asset though LOL

[mjfloyd1]

Not sure how we are going to lease "it fucks" asset though LOL

You rent those - usually by the fraction of an hour or desired act...

[agent47]

Not sure how we are going to lease "it fucks" asset though LOL

You rent those - usually by the fraction of an hour or desired act...

Lmao.

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[Ensoniq]

I'll state my unpopular opinion; don't do it

First, leasing is the most expensive way to pay for a car. Second, and I don't know your personal circumstances, I'd be thinking about building wealth before taking enormous payments on a depreciating asset. Things to think about

1) Are you out of debt (except for a mortgage)?
2) do you own a home yet?
3) are you able to save 25% of your take home pay?

The younger you are, the more you'll be hurting your future net worth by this decision

Sorry to be the bummer in the thread but think hard about how bad you really want the toy, compared to your future.

[agent47]

I'll state my unpopular opinion; don't do it

First, leasing is the most expensive way to pay for a car. Second, and I don't know your personal circumstances, I'd be thinking about building wealth before taking enormous payments on a depreciating asset. Things to think about

1) Are you out of debt (except for a mortgage)?
2) do you own a home yet?
3) are you able to save 25% of your take home pay?

The younger you are, the more you'll be hurting your future net worth by this decision

Sorry to be the bummer in the thread but think hard about how bad you really want the toy, compared to your future.

I don't think any of this is unpopular or a bummer. Its all financial wisdom.
Leasing is just easier and a little cheaper for people who like to keep changing cars regardless.

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[HeelBuff]

It's tough to advise someone on these kinds of decisions. People have differing values, priorities and perspectives which lead them to different rational conclusions. Otherwise stated, given the same set of facts, reasonable people can reach different conclusions.

Personally, I view cars and houses as things to enjoy and not so much as investments. I also believe if I can't stroke a check for a car then I can't afford it. Finance companies have big, beautiful buildings just like life insurance companies do.

[Kirks5oh]

my philosophy on buying (non-essential) things in general is if i have to break out a calculator to figure out if i can afford it, then i can't afford it---

seems simple, yet harsh, but that's what i do. things come up over the course of a 4-5 year lease that people just don't plan for. whether its a $10k roof on a house, $5k a/c unit for their house, or a broken ankle that puts you out of work for 2-3 months.

[Djpeaksd]

I'll state my unpopular opinion; don't do it

First, leasing is the most expensive way to pay for a car. Second, and I don't know your personal circumstances, I'd be thinking about building wealth before taking enormous payments on a depreciating asset. Things to think about

1) Are you out of debt (except for a mortgage)?
2) do you own a home yet?
3) are you able to save 25% of your take home pay?

The younger you are, the more you'll be hurting your future net worth by this decision

Sorry to be the bummer in the thread but think hard about how bad you really want the toy, compared to your future.

Great advice! The only thing that I would at to this. That leasing can be a huge advantage if you are self employed. I just know for me its a no brainer because of the tax benefits. I also switch cars fairly regularly so that makes it nice as well. Definitely wouldn't have a lease payment even close to what the OP got quoted but just saying.

[Ensoniq]

Great advice! The only thing that I would at to this. That leasing can be a huge advantage if you are self employed. I just know for me its a no brainer because of the tax benefits. I also switch cars fairly regularly so that makes it nice as well. Definitely wouldn't have a lease payment even close to what the OP got quoted but just saying.

That is a great point. Also, to be balanced I need to acknowledge the value a short term lease on a high end car. If I was changing cars every year or so and didn't want the hassle of having to,sell,it (dreamers and the financially incapable) I could see the attractiveness of knowing the amount of depreciation I was eating for the surety of being able to just hand the keys back.

[Awdbeast]

I appreciate your advice. I actually love to speak about such things such as wealth building, portfolios, mutual funds and dividend paying stocks. You make a great point about the depreciating asset. Originally I was considering a lightly used one but strolled into the dealer to have a look and things just escalated. As far as writing a check to buy the car out right. I'd rather those funds be held in stocks like T that pay me double what the interest on a loan will be. I do not own a home but I do own a few REITs(less up keep and more liquid lol). Since coming off of cloud 9, I'm reassessing and will probably go back to plan A of CPO car.

[RV81]

Here is a rule I follow when it comes to owning cars, the value of the car should be less than or equal to 5% of my net worth, because I don't want more than 5% of my wealth invested in something that depreciates on a daily basis. Doesn't matter whether you pay up front of take out a loan (Leasing is not considered since it will usually have a high interest rate and also limits your ability to modify the car). If you go through a credit union, you can get car loans at 3% APR.

Net worth calculation
Net worth = (Total value of things you own, eg: House, Stocks, Mutual funds, Precious metals, real estate etc..) - (Total money you owe , eg - home loan, credit card balance, or any type of debts).

Lets say your net worth is $500k, you are looking at a car that has a current market value of $25,000 - (In Audi world, you can get a nice C7 A6 3T for 25K, can't even talk about A7 or S7 with this money, RS7 doesn't even exist at this stage).

Awdbeast - If I am in your shoes, I will buy a brand new RS7 only if my net worth is $ 2.6 Mn or more. If not, I will look for options based on my net worth. If you think 5% is too low, set a higher percentage and that will help you make an informed decision which you will not regret 10 years from now. I would encourage not to go beyond 10% though. As you do better financially, you can reward yourself with the same % allocation and buy nicer/better cars in the future.

Also, please do not look at the monthly payment, calculate the TCO instead. In theory, somebody can sell you a Ferrari with as little as $500 a month, but you will be making payments for 30+ years.

Hope that helps, good luck.

RV

[antivirus]

Well, it really depends, but, for example, i prefer not to be in a bank's pocket. Investing money in business of course is the good way, but most of us here prefer to have property or things like cars being paid 100% without any loands. If bad times will come, i can just park my car untill i find the way how to solve the problem, otherwise i can sell it quickly with a little discount from regular market price and receive some cash. It's difference in mentality, in sociality between US and RF =) And here i'm not alone who preffer to planning budget according to the fact what we really have without any loands. Not trying to be offensive, just admitting the fact )

I had to post after reading the rubbish posted by Stan77 the simple facts are Russian's have stopped buying cars for the past few years. Car sales in Russia have plummeted year on year, in fact this years 2016 has had the lowest car sales in the past 10 years! and they say its going to get worse before it gets better.

Here's the report with all the details.
http://europe.autonews.com/assets/PDF/CA105245512.PDF

Leasing is very popular in Russia! Leasing of cars accounted for nearly half of the market value in 2013 and was growing at a double-digit rate in both 2013, 2014 and 2015. At the rate it's growing everyone in Russia will be leasing. In fact the Russian Government have actually started to subsidise leasing over there to increase cars sales. Read all about it in the link below
http://blog.euromonitor.com/2015/08/...ar-market.html

The fact that some Russians are buying anything has more to do with the collapse of the Ruble than anything else. Why would you keep your money in the Bank or take out a lease to buy anything if you lived in an economy where the local currency is in decline. If I lived there I'd have bought a Lada and invested the rest in Gold :-D

[SlickMachine]

Here is a rule I follow when it comes to owning cars, the value of the car should be less than or equal to 5% of my net worth, because I don't want more than 5% of my wealth invested in something that depreciates on a daily basis. Doesn't matter whether you pay up front of take out a loan (Leasing is not considered since it will usually have a high interest rate and also limits your ability to modify the car). If you go through a credit union, you can get car loans at 3% APR.

Net worth calculation
Net worth = (Total value of things you own, eg: House, Stocks, Mutual funds, Precious metals, real estate etc..) - (Total money you owe , eg - home loan, credit card balance, or any type of debts).

Lets say your net worth is $500k, you are looking at a car that has a current market value of $25,000 - (In Audi world, you can get a nice C7 A6 3T for 25K, can't even talk about A7 or S7 with this money, RS7 doesn't even exist at this stage).

Awdbeast - If I am in your shoes, I will buy a brand new RS7 only if my net worth is $ 2.6 Mn or more. If not, I will look for options based on my net worth. If you think 5% is too low, set a higher percentage and that will help you make an informed decision which you will not regret 10 years from now. I would encourage not to go beyond 10% though. As you do better financially, you can reward yourself with the same % allocation and buy nicer/better cars in the future.

Also, please do not look at the monthly payment, calculate the TCO instead. In theory, somebody can sell you a Ferrari with as little as $500 a month, but you will be making payments for 30+ years.

Hope that helps, good luck.

RV

No.

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[RV81]

[QUOTE=SlickMachine;11763883]No.

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[DDIXON7]

I work for an Audi dealer and on a car like this just tell them you want buy rate on the money factor. Dealers make $10k+ on the front end of an RS7 deal so you can basically throw that in their face. Rates vary by region but current buy rate mf for my region would be .00168 for a 36 month lease.

[CanuckRS]

I don't want more than 5% of my wealth invested in something that depreciates on a daily basis. Doesn't matter whether you pay up front of take out a loan (Leasing is not considered since it will usually have a high interest rate and also limits your ability to modify the car).

#1. this is one of the issues that leads people into trouble with vehicles. the are NOT an investment. they ARE an EXPENSE, a costly one at that. 99+% of vehicles depreciate over time, that is not considered a financial investment, quite the opposite.
#2. you can modify vehicles on a lease if you want, who says you can't? i'd done it many times and the beauty is the lessor takes it back at the end, it's then their problem to deal with. modifying affects your warranty more than anything else and that applies equally to a lease vs own situation.

Car payments have more to do with your cash flow than your net worth. Figure out what you can comfortably afford to spend while knowing the money you put into it will likely not come back any time soon and if it does you're going to lose a chunk of it. Common sense here.