<prompt> Human: I just graduated college, and Im about to start my job with a 70k salary. Ive been kicking around the idea of replacing my car. My thinking is that Ill keep my current car long enough to save up at least 10k for a down payment. I figure by that time my car will be worth around 10k too, making for 20k down-payment.I read online that 20 of your take-home pay is reasonable for a car payment. For me, thats 746 after taxes and 12 for retirement savings. By that logic if I put 20k down on a car I can afford a 40k if I finance 20k for 36 months 5. The payment would be around 600, so no problem.So, am I missing anything? I really enjoy cars, but not at the expense of making sound financial decisions.P.S. - I understand cars are not investments, and as an asset only lose value.Edit: I knew there had to be some things to consider before spending such a large sum of money on a car, and you guys brought up some really good points. I think I will take care of an emergency fund first, and then try on the car payment for 6 months or so to see how it affects my life style. Some people just enjoy owning and working on nice cars as a hobby. Who cares what the Jones drive :  <response>: What is wrong with the current car that it needs to be replaced? Or, are you just going for the look at me i make 70k car? From personal experience i would recommend saving as much as you can. Big and shiny doesnt make happy. As far as retirement I would max out 401k and what ever else you can until later on down the road.. Its much easier to put it all in now then try and catch up later. 