Are the benefits of a luxury vehicle worth the expense? Advertiser Disclosure Advertiser Disclosure We are an independent, advertising-supported comparison service. Our aim is to assist you make smarter financial decisions by providing you with interactive tools and financial calculators, publishing original and objective content, by enabling you to conduct research and compare data for no cost and help you make sound financial decisions. Bankrate has agreements with issuers, including but not limited to, American Express, Bank of America, Capital One, Chase, Citi and Discover. How We Make Money The deals that are displayed on this site are from companies that compensate us. This compensation could affect how and when products are featured on this website, for example the order in which they may appear in the listing categories in the event that they are not permitted by law. Our mortgage, home equity and other home loan products. This compensation, however, does affect the information we provide, or the reviews that you read on this site. We do not include the vast array of companies or financial offers that may be available to you. SHARE: Peter Cade/Getty Images
4 min read . Published March 02, 2023.
Written by Dan Miller Written by Points and Miles Expert Contributor Dan Miller is a former contributor writer for Bankrate. Dan was a writer for Bankrate who covered loans, home equity and managing debts in his writing. Written by Rhys Subitch Edited by Auto loans editor Rhys has been editing and writing for Bankrate from late 2021. They are dedicated to helping readers gain the confidence to take control of their finances by providing concise, well-studied information that simplifies complex subjects into digestible pieces. The Bankrate promises
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At Bankrate we are committed to helping you make better financial choices. We adhere to the highest standards of editorial integrity ,
This article may include some references to products offered by our partners. Here’s a brief explanation of how we make money . The Bankrate promise
Established in 1976, Bankrate has a long experience of helping customers make smart financial choices.
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who ensure everything we publish is objective, accurate and trustworthy. The loans reporters and editors focus on the areas that consumers are concerned about most — the different kinds of loans available, the best rates, the top lenders, the best ways to pay off debt and more — so you can feel confident when making a decision about your investment. Integrity of the editing
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You have money questions. Bankrate has answers. Our experts have been helping you master your finances for over four years. We are constantly striving to give our customers the right guidance and the tools necessary to be successful throughout their financial journey. Bankrate adheres to a strict code of conduct standard of conduct, so you can rest assured that our information is trustworthy and reliable. Our award-winning editors and journalists produce honest and reliable content that will help you make the best financial choices. The content created by our editorial staff is objective, truthful and is not influenced by our advertisers. We’re honest regarding how we’re in a position to provide quality information, competitive rates and useful tools to our customers by describing how we make money. Bankrate.com is an independent, advertising-supported publisher and comparison service. We are compensated in exchange for placement of sponsored products and services or through you clicking specific links on our website. This compensation could affect the way, location and in what order items are displayed within the categories of listing in the event that they are not permitted by law. This is the case for our credit, mortgage, and other home lending products. Other factors, such as our own proprietary website rules and whether the product is offered in the area you reside in or is within your personal credit score can also impact the way and place products are listed on this site. Although we try to provide a wide range offers, Bankrate does not include information about each financial or credit item or service. If you’re in the market for a new or , you may be thinking about whether purchasing a luxurious car is worth the investment. There isn’t a minimum cost or number of features that define a car”luxury “luxury car,” you will have several options. How do you determine if a luxury car is the right choice for you? There are a few factors that you will want to consider when shopping for the right car for your needs. Are the features better? If the car’s performance is especially important to you, you should pay close attention to the car’s performance ratings. Using them, you can measure factors like the acceleration, handling and braking power. Although this is not always the case some luxury brands boast better performance. Bankrate tip
Check ratings from third-party ratings such as J.D. Power and Kelley Blue Book to see if the handling is worth the price. Less-pricy cars can still be fun to drive.
Do the safety ratings surpass those of other brands? Another factor to consider when looking at a luxury car is the maker’s safety ratings. Luxury cars have a reputation for having higher quality parts and high-quality manufacturing standards. This often leads to more safety ratings for front or front impact, roof strength and crash avoidance features like headlight brightness or collision prevention devices, in addition to other factors that affect rating. The Insurance Institute for Highway Safety (IIHS) is an independent third-party entity that aims to reduce the number of deaths, injuries, and property damage from motor vehicle accidents. The IIHS provides ratings to the majority of new vehicles in various categories of safety each year. When you compare luxury car brands or models vehicle’s IIHS security rating can be a different benchmark to consider against less expensive brands. Bankrate tip
Before signing off on the purchase of a luxury car, look for the safest options for less than $25,000.
Are the features offered in a car that is not luxurious? From sunroofs to leather seats Comparing various makes as well as models means comparing a plethora of features. What is important to you may not match up with the standard package options of a specific type of vehicle. Consider putting in writing specific features that matter the most to you — this will assist you when you look for the right car . A few high-end features that buyers are seeking when they are considering a luxurious car include an entertainment system of the highest quality, heated or massaging seats, or even the ability to integrate smartphones. It is crucial to determine what is important to you can help keep your feelings in check as you go new car shopping. Tips for Bankrate
Be aware that the advancements in cars are constantly evolving. More importantly, today’s luxury car features tend to be the norm in the near future.
Are the investments worth the investment? While there isn’t a set minimum price for what is considered a luxury car, a luxurious car will command a price premium in comparison to other automobiles. They are generally depreciating assets, meaning that their value decreases over time. Consider that it is common for the upkeep of expensive cars to be more costly than those of less expensive cars. Repairs, parts, labor and similar items will typically be more expensive. Be sure to budget for increased ongoing costs as well as the higher cost of purchase. Tip for Bankrate
Make use of this opportunity estimate of how much your luxurious car will cost monthly.
What is the difference between a fully loaded car is different from a luxurious brand ? A luxury car doesn’t have a specific definition. What most people think of as a luxurious car is contingent on the car’s make. Brands such as Lexus, BMW, Mercedes or Jaguar are thought of as “luxury” in a lot of people’s minds. While it is true that the cars of these manufacturers come with high-end options, you’re paying a bit for the cachet of the brand name. Instead of choosing a high-end brand look into purchasing a standard car. Even a vehicle as basic as a Honda Civic has many different trim options. Although the base package comes with basic features, the more expensive trim packages offer many higher-end features you might think are exclusive to luxury cars. Consider the types of things you’re looking for and decide based on that. Luxury vehicles depreciate at a faster rate All vehicles depreciate the moment that you leave the dealership. But luxury vehicles depreciate more quickly than their competitors in the middle. Quicker depreciation means that you likely will not make back the money you spent on the car when the time comes to sell it. Take note of the following factors that lead to more rapid depreciation. More information on the market. Luxury drivers tend to buy new vehicles every few years. That means the quantity of cars available sometimes exceeds the number of buyers. Models become dated. People who pay money for a luxurious car are likely to desire to have all of the bells and whistles. So an older model will not get the premium cost you initially purchased it for. As models age much more quickly. Vehicle maintenance. Trips to the body shop are likely to be more expensive for the latest or foreign models, adversely affects the value of the car’s sale. If you want luxury without excessive depreciation, think about purchasing a vehicle that is instead of new. That way, you can enter the luxury space without being stuck with money lost. Finance a luxury vehicle based on the kind of luxury car you buy it is possible to finance it the same way you finance any other brand new vehicle. But if your new luxury car ends up being higher than the traditional auto lenders will loan to you, you may need to think outside the box. Contact the dealer. Car dealers with luxury cars may offer opportunities to take advantage of. Think about making a bigger deposit. If you’re having difficulty getting a car loan for the full amount of your purchase, you might need to . Find financing. It is possible to finance your luxury vehicle with a personal or home equity loan. Look into a luxury car lease. If you are itching for a luxury car but you aren’t sure if you want to buy it might be worth considering a brand new car. The main point is that a fully loaded standard car and the luxury vehicle are both valid options, and no single answer is the best for every person. Look at the different choices that are available in the cars you’re interested in , and then ask yourself whether you’re just paying to get the name of the car. This will help you determine what’s best for your situation.
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The article was written by Points and Miles Expert Contributor Dan Miller is a former contributor to Bankrate. Dan covered loans, home equity and debt management in his work. Written by Rhys Subitch Edited by Auto loans editor Rhys has been editing and writing for Bankrate since the end of 2021. They are passionate about helping readers gain confidence to control their finances with concise, well-researched and well-studied content that break down complex subjects into bite-sized pieces.
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