Manny, the short answer is "No", a poor man simply cannot afford a Lambo. However, you are far from poor. You may not be a richest guy in the world, but you have a decent income, own your home outright, and sizeable savings and investments.

First up, I recommend you go talk to a reputable and friendly official dealer on a day when they're not busy. I can't say what prices and costs are like in Canada - you'll have to research that yourself, but here's my basic thinking in UK prices:

A decent car from a reputable dealer: GBP 82k. I'm using a particular car as an example here - a 2003 with big service, new clutch and front respray just done, and should require no further expenditure for at least a year.

Depreciation in the UK appears to run at about 10% or so per year, plus dealer margin when you sell, which is a further 10% or so. Figure this in - the really cost of ownership is depreciation and running costs, not the purchase price.

If I understand things right in year 2 you'll need a small service, at GBP 1k. Then a big service in year 3 for GBP 2.5k. If anything goes horribly wrong you can either afford to fix it, and swallow the cost, or sell up if you really have to.

Then there's tax and insurance - get an insurance quote for costing purposes. For me that's another GBP 1K insurance, plus road tax of ... what is the UK road tax on these things now?

When you have all the numbers, put them together in a 3 (or more) year plan, and assess your situation. Can you afford it without risking stuff you don't want to (like your home or investments)? My guess is it will be close. Don't count on getting pay raises to cover things in the future (cos as soon as you do they don't come through - like the one time I planned against a next pay rise). Consider worst case scenarios: if this happened, what would I do and would that be financially sound.

With that much cash in hand, you could probably get a loan at a reasonable rate for something like 25% of the purchase price for an early model and pay cash for the rest. You might consider borrowing against your home for the extra cash if you get a better interest rate that way, but remember you shouldn't risk your home - look at the worst case scenarios: if it's stolen or wrecked make sure you have good quality insurance that will pay up and cover the loan. If it goes horribly wrong and you can't afford it any longer then consider whether you will be able sell it for enough to pay off the loan.

As I understand thing here in the UK, most Lambo purchases are financed - they pay a third cash, and finance the rest over a few years, during which time another third is paid off. At the end of the finance period you have the option to pay for the remaining third and keep the car, or let the finance company sell the car, take their third and give you the remainder.

So for me, my hypothetical financial plan looks like:

Year 1:
82K on purchase of good early model Gallardo
1.5k insurance, tax, etc
Est value at end of year: 66k

Year 2:
1.5k insurance, tax, etc
1K small service
Est value at end of year: 59k

Year 3:
1.5k insurance, tax, etc
2.5K big service
Est value at end of year: 53k

and so on. So after 3 years, if I sold it then I'd be looking at a total cost of 37k for 3 years of ownership - 12-13k pa. OK there's quite alot of assumptions in there, but that's unavoidable. At least it gives me some kind of guideline idea, which is especially important to people with tight budgets or using financing (I'm not).

Hope this is helpful and good luck anyone who is not a multi-millionaire going down the Lambo purchase avenue

Buy the Gallardo. Just make sure that you have 10k to 15k to keep in the bank, that way you have nothing to worry about for the next 2 years or even more. I drove my Gallardo 8k in a year and it didn't need one penny, but gas and insurance. A clutch is around $5,000 for a manual shifter, plus the engine doesn't come out of the car for this or any other service, and rear tyres aren't cheap. Good luck.

Gallardo is the most practical.

what about a 25yr old, income of $200k and rents...? rent and car run about 2800 mo. i'm locked into my apt for approx 12 months and was thinking about playing around in a gallardo until its time to buy a house.

good idea, bad idea?

at 36K per year I'd be awfully sure your bride is totally onside with your exotics dream. Given you want a daily driver, how long to run up 15K miles after which your going to pay 1/2 your annual salary to maintenance. Don't be crazy, be patient. Why not try the new Mecedez SLK55. I have both and the MB actually is like a little exotic and you'll get a lot of compliments and heads turning. (plus you can safely park it in a shopping mall lot with out fear)

At 36K per year I'd be awfully sure your bride is totally onside with your exotics dream. Given you want a daily driver, how long to run up 15K miles after which your going to pay 1/2 your annual salary to maintenance. Don't be crazy, be patient. Why not try the new Mecedez SLK55. I have both and the MB actually is like a little exotic and you'll get a lot of compliments and heads turning. (plus you can safely park it in a shopping mall lot with out fear)

I was going to post a similar question, but this thread has already started.

Is there a general formula comparing yearly income to car cost that a reasonable person should go by? Such as yearly income should be at least 2X the car cost. (I am not very reasonable myself, however, since I purchased a $54K car when I had made $62K the previous year.) Now that my income is much higher I too am considering a Gallardo or Murcielago in the future.

To b18bek, which model are you considering? New or used? With that income I'd think a used Gallardo is pretty reasonable.

yeah, i was looking at a used gallardo, something low miles 3-5k, and around $130-140k. it will have to be strategic so that i can get a good year or two usage out of it and still avoid hitting any major maintenance checkpoints.

You might want to make sure your bride is totally onside, given your first service (which will loom large on the immediate horizon if it's a daily use car!!) will likely be 50% of your annual income. Better to buy a Mercedes Benz SLK55 or such to see how that works out...$500.00 to $1,000.00 per service on average, you'll get just as many heads turning (almost) plus you can park it in a mall parking lot!

If you have to ask the question....you can't. You either know if you can or can't. If have to ask can I afford to put a clutch in it or can I afford insurance or tires, etc.....then you CAN'T. You don't have to have unlimited money to own a lambo, I don't, but you should not have to budget for an unforseen expense.

Also, I don't care about or believe any of the other number you gave except the 3000 per month and the answer is you can't afford it at 3k per month. I was driving a Geo Tracker when I made 3k per month. Now I drive a 04 G, in addition to other vehicles, and never wondered if I could afford it. I waited until I knew I could. You just know.