What Kind Of Car Should The Mass Affluent Buy?

Moose - A Land Rover Discover II Getting Fixed

Moose On The Operating Table

We previously described the mass affluent class by income, wealth, and investable assets. Mass affluent is essentially a subset of the middle class that’s well educated and upwardly mobile due to their education and optimism. Given you’re reading a personal finance site for fun and education and I’m writing personal finance articles, let’s all consider ourselves mass affluent with upside potential! Hooray!

After 10 years of owning the same car, I’ve decided to finally buy something new within the next six months. There are a number of problems with Moose, a 2000 Land Rover Discover II, including:

• Warning lights on for the traction control, hill decent, and ABS.
• Check engine light is permanently on.
• Sunroof doesn’t open or close.
• Heated seats don’t work.
• No Bluetooth.
• CD changer doesn’t work.
• Front passenger seat no longer adjusts due to broken motor.
• Cigarette charger doesn’t work, which means I can’t charge my mobile devices on long road trips.
• Brakes are mushy even after changing them two years ago.
• Not sure if the airbags work since they haven’t had their 10 year service.
• Gears don’t connect once every 50 starts for some reason. Have to turn him off, wait for 10 seconds, and turn back on to reengage the gears.
• Two balding tires that cost $200 to replace each.

Other than these 12 problems I can think of, Moose runs like a champ!

Over the past three years I’ve spent about $1,100 buying him a new alternator, a new serpentine belt, a tune up, and fixing a massively leaking fuel pump. If there is one more problem that costs over $500, I’m sad to say that I’ve got to let him go. It’s hard to do because he’s been so good to me. Moose has never broken down, not even in the worst Tahoe snow storm. If I’m ever in an accident, I feel safe that Moose will hold up better as well.

I’m starting to fear that I’ll one day get stranded somewhere when Moose experiences some transmission glitch. I know all I have to do is call roadside assistance and wait 45 minutes for a boost or a tow, but that’s not ideal if I’m rushing somewhere. If you have an older car, getting roadside assistance for several bucks a month is the best thing ever. I did leave my lights on several times before and roadside assistance came quickly to give me a jump.

I’d love to finally find a new vehicle that has all the creature comforts that many people for the past five years have taken for granted. You know, like being able to plug in your mobile phone to listen to some tunes. I’ve come up with a list of vehicles I’m considering for myself and for the mass affluent. Let me know which particular car or category you’d choose and why. 

The Econo Practical Ride

Honda Fit Economy CarHonda recently came out with its latest Fit model and I think it’s a great choice for a mostly city driver. The car is only about 160 inches long, which makes it ideal for parking in tight spaces. Moose is 184 inches long in comparison. I’ve lost out on many open parking spaces as a result.

The Honda Fit’s fuel economy is around 28-35, more than double Moose’s fuel economy. Instead of costing $70 to drive to Tahoe 210 miles away, I’ll only have to spend $30.

The Honda Fit LX version with alloy wheels (not hubcaps) costs about $19,000 before tax, and $21,500 out the door in California. One thing to note is that the latest Honda Fits are no longer made in Japan, but made in Mexico to reduce costs for Honda. Who knows for sure whether the Mexican made Hondas will be as high quality as the Japanese made Hondas. Only time will tell.

Being frugal and green is a very San Francisco thing to do. Even though Moose guzzles a lot of gas, at least I’ve held on to him for 10 years, and didn’t add pollution by buying another car. If you don’t completely destroy your old car, you are still adding more pollution if you buy a new one.

The Honda Fit is a great way to practice Stealth Wealth. but it’s also a great way to get zero attention from all the lovely ladies looking to meet blogger studs. The car enthusiast in me will probably long for a faster, beefer, and more fun car to drive. I’m used to sitting up high, which is very helpful during traffic. Sitting down low feels a little claustrophobic.

With the money saved buying a compact car, I’ll have at least $20,000 more to invest that will hopefully grow in the long run. The problem is that 2014-2015 models are on back order due to too much demand.

Babe magnet rating: 1/10

Stealth Wealth rating: 10/10

Thrill rating: 2/10

Alternative compact cars under consideration:

  • Nissan Sentra for $18,500. Lots of space, good price, decent looks.
  • Nissan Versa Note for $17,000 – $19,000. New version that looks better, has great space, and costs $19,000 or less.
  • Toyota Yaris hatchback for $17,000-$18,000.

The New Mini Moose

Range Rover Evoque Black LimitedThe Land Rover Evoque came out in 2010 and has won numerous awards, including Motortrends Car Of The Year, and World SUV Of The Year. It has a 240 hp engine, which is 55% more powerful than Moose’s engine. It sits up higher than a regular car, but is lower than Moose.

The Evoque is about 171 inches long, which is 13 inches shorter than Moose and is much better for parking. The only downside is that the rear seats are pretty cramped, and there’s not much luggage space compared to Moose. I would say luggage space is 40% less. Good thing I don’t lug much stuff around.

The Evoque is probably much safer than a Honda Fit if I were to get into a head on, rear, or side accident. It has 10 airbags, is much heavier than a Fit, and has much thicker doors. If I am to have a family, having a heavier, thicker, safer car is important. I don’t know if I could live with myself if my child got injured or died because I decided to go with a compact car. If you could afford a car that was built like a tank to transport your kids, wouldn’t you be willing to pony up if you could afford it?

The big downside with the Evoque is the sticker price. The base model runs for $44,500, and the Limited Edition version (pic) goes for around $60,000. The price violates my 1/10th rule for car buying, but does not violate my net worth rule for car buying. I will either pay cash or have my business buy this car. See: Tax Rules For Buying A SUV Or Truck To Deduct As A Business Expense

I know I’ll really love driving around a Limited Edition Evoque. It looks great with its black 20” rims. The Evoque will make driving fun again, especially on the 3 hour drive to Lake Tahoe during summers and winters. It’ll feel good knowing that I’ve got a more compact car that’s safer and with more horse power. The MPG is not bad at 21-28 either.

The Evoque is a car I could easily own for 5-10 years. The Honda Fit is a car that I could own for 2-3 years and probably get bored as I start thinking to myself what’s the point of saving and making all this money if I don’t live it up a little.

Babe magnet rating: 8/10

Stealth Wealth rating: 4/10

Thrill rating: 8/10

Other considerations:

  • BMW X3. This is BMW’s mid-size SUV (between X1 and X5). Looks OK, and has more rear space. Cost is around $52,000 for the 3.0 litre engine which is larger and faster than the Evoque’s.
  • Audi Q5. Been around for at least four years now and a new model will be coming out in 2015 or 2016. Good looking car if you get the S-Line version, which also costs about $52,000.
  • Porsche Macan. Porsche just came out with a smaller version of the Cayenne and it looks sweet! There are two models: S and Turbo. The S looks good enough and comes in at about $54,000 with mid-level trim. I’m going to have to take a look.
  • Range Rover Sport. I’m a big fan of the latest aluminum body Range Rover Sport. The downsides are that it’s very wide at 80″, is a gas guzzler, and costs about $80,000 out the door.

The Electric Car

BMW Electric Car i3I finally drove an electric car for the first time and loved it! BMW has come out with the new i3, which is a compact four door. It looks good, and it’s fast! They say the new i3 has the fastest 0-30 time of BMW’s entire fleet.

The i3 costs about $45,000 – $52,000 and has a standard range of about 80 miles on one full charge. You can get a range extender or hybrid motor, but that costs another $10,000 more, making the price hard to digest.

Given the technology is always improving and the battery fades over time, it’s a much better idea to lease an electric vehicle vs. purchasing one. I wrote a pretty extensive article on things to consider when buying an electric vehicle if you’re interested in knowing more.

The biggest problem I have with the BMW i3 is the range. I cannot get to Tahoe on one charge, and it takes anywhere from two hours for a quick charge to eight hours or so for a standard charge. The EV charging stations aren’t fully built out yet.

One solution I’ve thought about is driving for 75 miles up to Tahoe and charging the vehicle while I get lunch or dinner. But even with another 75-80 mile charge up, I will still be 50 miles short of my place! It looks like I will have to either rent a gas vehicle to go up to Tahoe, or use the i3 as my second car, which is not ideal since I only have space for one car in my garage.

Babe magnet rating: 6.5/10

Stealth Wealth rating: 5/10

Thrill rating: 8/10

Other considerations:

  • Nissan Leaf. Excellent alternative to the i3 at $32,000. Also won World Car Of The Year when it first came out several years ago.
  • Tesla Model S. The P85+ Tesla has a range of 250 miles, and would therefore solve my Tahoe problem. It’s a sweet car that has a lot of space, but it costs about $110,000-$120,000 for this version. I can get a regular version for about $70,000, but it won’t get me to Tahoe. Perhaps it’s best to wait for their more mass market $45,000 version in 2015.


2014 Range Rover Sport

2015 Range Rover Sport. Too expensive at $80K

I’m assuming many of you will say, “none of the above” given there are so many choices and so many different tastes. But humor me a bit and choose one a category (Econo, Mini SUV, Electric) and then the specific vehicle.

I know I should probably just get a Honda Fit given it’s the perfect city car and has everything I need (except for 4WD to Tahoe). It jut doesn’t have the horsepower or desirability. I really dislike driving due to traffic and bad drivers. But I think I’d enjoy driving a little more if I once again had a luxury car like the Limited Edition Evoque. If I’m going to hold on to the car for another 10 years, the price hit doesn’t feel as bad. Furthermore, there was a time for many years where the Evoque clearly fit under my 1/10th rule for car buying.

The other alternative is to once again do nothing and keep Moose until it finally breaks down on me. I love Moose because I can leave him parked outside and not care too much if he gets bumped, scratched, or even stolen. If someone wants to rage with me on the highway, I have no problem playing bumper cars. If I was driving a brand new car, I’d be more stressed about wrecking it.

The final consideration I have is the cost of maintenance. The first three years of maintenance are all included for the Honda and the BMW has a 4 year, 50,000 mile warranty. But I’ve got to pay for brakes and new tires with the Evoque if they wear out in the first three years.

According to an eSurance quote on the Honda Civic, it’ll only cost me around $25 a month. The i3 and the Evoque will cost me around $50-70 a month. Not that big of a deal, but still a difference nonetheless. I haven’t gotten a ticket or been in an accident for over seven years, so my driving record is very clean. I’d check out eSurance for the lowest auto insurance rates possible.

What do you think folks? Live it up a little or stay practical? 

Which car or category would you choose?

View Results

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Updated for 2016 and beyond

Sam started Financial Samurai in 2009 during the depths of the financial crisis as a way to make sense of chaos. After 13 years working on Wall Street, Sam decided to retire in 2012 to utilize everything he learned in business school to focus on online entrepreneurship. Sam focuses on helping readers build more income in real estate, investing, entrepreneurship, and alternative investments in order to achieve financial independence sooner, rather than later.

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  1. K says

    Hi Sam! I’m back, I was busy….buying a house! So thank you for all of the advice on work and personal finance…probably wouldn’t have been able to buy a house before 30 without it. And about work… well I still haven’t gotten the promotion or salary, but they gave me the employees and override, which equals the pay I wanted, but I’m still full commish and no title. I have everything I wanted but no title or salary. But I want to move into a salaried management position for security and upward mobility. My dad tells me to screw the title and take the money (and it seems that this is what everyone who I talk to have to say about it), but I don’t want to be this for the rest of mylife…there has to be some kind of progression to my career. I also worry that I’ll never have an exit strategy elsewhere if I don’t come out of here without a title. And the longer I stay in a full commish position, the longer I pigeonhole myself into someone who can only bring value to company as a salesperson. Do you think this is intentional so I have no other options so I stay where I am and keep making the company money? I struggle with this all the time now. What are your thoughts?

    Now to be relevant to your post… what about buying a nice used car that satisfies both your practicality and your taste for nice cars? I have an old accord. But I’ve always wanted a Maserati. But I won’t let myself until I’m within the 1/10 rule. So here’s the deal…I’m on track to make $300K this year and next year the model I want will probably be available for $30K cash (it’s going for $40K now). Would I get the 1/10 seal of approval for something like that? Also, maybe I missed this, but is there a rule about having more than one car? Can I keep the accord and buy the Maserati? Or do I have to sell the accord to buy the Maserati? I still wanted to keep my accord as my daily driver for gas efficiency and stealth wealth and just use the Maserati on weekends with my family.

  2. Jay says

    I’m a sports car guy, nissan GTR as my weekend fun car, BMW335 as my daily commute car and GL450 as my family car.

    I totally broke your 1/10 car buying rule :)

  3. kailuatown says

    Easy answer: range rover sport.

    How long have you been talking about driving moose until you run him into the ground? I know the RR has been on your mind for a while. Although it defies your 1/10 rule, it will most likely qualify under your net worth rule.

    C’mon Sam, you’ve done very well for yourself and should enjoy the fruits of your labor. If you can’t bring yourself to paying $80k, find a used one that’s 1 or 2 years old and let someone else take the hit upfront on depreciation.

    When you become FI, you should treat yourself to something you want. What good is having money if you can’t spend it on something you’ll enjoy for many years to come?

    Besides, it’ll be a nice write off for the biz….and will score you some points with the ladies for sure.

  4. Practical Patty says

    my vote is the honda fit and/or waiting if you can & getting a used range rover if that is most practical for your needs.. So…what kind of babe are you looking to attract? A practical babe like myself won’t go for the flash of a more expensive car. A practical babe like me thinks retiring in your 30’s is hot.

  5. says

    So I have one point to make… I am like you and I LOATHE driving. I hate it. I thought that if I got a fancy luxury car that’s fun to drive it would make me hate driving just a bit less. I got a fully loaded Ford Edge (at the time, where I worked, I drove clients around and so I couldn’t quite go for the true luxury car… would have looked like I wasn’t spending their money well. ;) )

    So my car has 5 LCD screens, tons of toys, panoramic sunroof, DVD players, seat heaters, etc, and while those things are nice, they still haven’t solved the “I hate driving” problem. So just from personal experience, a nice car probably won’t solve that.

  6. JB says

    I originally wrote out an epic post, with prose that would make James Joyce swoon but alas my Apple Juice went dry and now it’s gone forever more.

    So here’s the crux: a car is a depreciating asset, nothing more. A bicycle is an appreciating asset that matures the dividend within yourself. The money you save will allow you to rent a car when you need to go to Tahoe, take a cab when it pours.

    You live in San Francisco: one of the best cities on America for cycling of less than 47 square miles so you can get anywhere actually easier than with a car.

    Once you embrace the bike you’ll never want to waste time in a car ever again.


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