Buying a luxury car is a big financial decision, and it’s important to consider all the factors before making a choice.
The first step in deciding whether it’s okay to buy a luxury car is to define what constitutes a luxury car. This is a subjective matter that depends on the individual’s unique circumstances. For example, a brand new Toyota Sequoia may be considered a luxury vehicle for some people, while it may not be for others.
The next step is to consider whether you have followed the Financial Order of Operations. This includes having an emergency fund, maxing out tax-free savings opportunities, and saving 20-25% of your gross income for the future. Once you have taken care of these necessities, you can start making decisions based on your preferences. If you have satisfied all of the steps in the Financial Order of Operations and are in the hyper-accumulation phase, then it may be time to think about buying a luxury car.
We joke about the idea of considering features like heated and ventilated seats or a sun roof as indicators of a luxury car. Ultimately, the decision to buy a luxury car is a personal one that should be made after careful consideration of all the factors.
Check out our Financial Order of Operation course here.