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What's Your TTI Ratio?

Discussion in 'Model S' started by sdorn, Dec 1, 2016.

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What's Your TTI Ratio?

  1. Less than 0.25:1.00

    24 vote(s)
    26.1%
  2. Greater than or equal to 0.25:1.00 but less than 0.50:1.00

    34 vote(s)
    37.0%
  3. Greater than or equal to 0.50:1.00 but less than 0.75:1.00

    11 vote(s)
    12.0%
  4. Greater than or equal to 0.75:1.00 but less than 1.00:1.00

    9 vote(s)
    9.8%
  5. Greater than or equal to 1.00:1.00 but less than 1.25:1.00

    5 vote(s)
    5.4%
  6. Greater than or equal to 1.25:1.00 but less than 1.50:1.00

    1 vote(s)
    1.1%
  7. Greater than or equal to 1.50:1.00 but less than 1.75:1.00

    2 vote(s)
    2.2%
  8. Greater than or equal to 1.75:1.00 but less than 2.00:1.00

    2 vote(s)
    2.2%
  9. Greater than or equal to 2.00:1.00

    4 vote(s)
    4.3%
  1. sdorn

    sdorn Director of Awesome

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    I was just wondering what the typical financial situation is for someone that purchases a MS, but wanted to find out in a way where people don't need to divulge their income or other personal information. I thought a poll would be a good way to do it, as the results are anonymous.

    I also figured coming up with a ratio rather than using raw numbers would make the comparison more useful and could apply across the full price range of a Model S. So I thought of the TTI Ratio (Tesla to Income Ratio) which would be calculated as the ratio of the cost of your Tesla to your annual gross income.

    To keep things as simple as possible I would set the cost of a brand new custom ordered Tesla or an inventory car that was not sold at a discount at an amount equal to the full MSRP, ignoring any referral bonus, income tax credit, delivery charge, sales or property taxes, etc.

    For an inventory car sold at a discount because it was used as a demo car or loaner or because it has out of date hardware, the cost should be the actual purchase price, but again ignoring taxes, credits, etc.

    For the denominator gross income is pretty straight forward, but for anyone that is retired or funds their lifestyle in whole or in part on savings/investments/pension distributions, etc., you should use whatever amount you have available to you annually to fund your living expenses.

    So as an example if you purchased a brand new MS for $100,000, and you have a job where you make a $100,000/year gross annual income and have an inheritance that provides you with a distribution of another $100,000 per year to fund your lifestyle your TTI Ratio would be 0.50:1.00 since the cost of your Tesla was 1/2 of the amount available to you annually to fund your lifestyle.
     
    • Like x 2
    • Informative x 1
  2. ShockOnT

    ShockOnT ⚡️⚡️⚡️⚡️⚡️

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    Australia has this horrible thing called "Luxury Car Tax" which adds 33% tax to every dollar over $57,000 (~$45,000US).
    This has the weird effect of making the top spec cars hugely more expensive than the base models.
    Eg. A S60 is $118K, but the P100D is $254K.
    It also makes every accessory/option 33% more expensive, so adding leather seats costs $6,000 instead of $4,000 and so on.
    Curse my government!
     
  3. ev-now

    ev-now Member

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    And big important duties for electronic goods too still? Just as well you guys are all paid 3 times the global average right ;)
     
  4. ev-now

    ev-now Member

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    Already seeing what I expected from you chosen buckets - most are going to be in the first two buckets. For meaningful distribution you might need a finer grain at that end of the scale - I'm guessing way north of 90% of owners are under 0.50.
     
  5. bcampbelllds

    bcampbelllds Member

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    Dang Australia! That is a huge price increase.
     
  6. doctorwho

    doctorwho Member

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    Yep, and everything costs 3-5x the global average too:(. It's now a really expensive country to live in. Even without the Luxury Car Tax, Australians pay what is called the 'Australia Tax' by locos - if an importer can charge more then they will. My Tesla was 3x more than the next most expensive car I've ever bought but as I usually keep cars for 10 years and do high mileage, an ICE car will be worth scrap value in 10 years and won't be that much cheaper in total cost of ownership
     
  7. Max*

    Max* Banned

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    Does the income include my rental income?
    Does the income include my spouses income?

    (i.e. family income, or just my income)
     
  8. sdorn

    sdorn Director of Awesome

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    You should include all the sources that are available to fund your lifestyle.
     
  9. sorka

    sorka Active Member

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    I wouldn't base it on gross income. Someone who makes high W2 gross income will have less income than someone who makes even just 2/3rds of that from investing.
     
  10. ThisIsTrue

    ThisIsTrue Dismember

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    LOL! Such a simple thought, and how complex it became right off.

    Now you know why Economics is a black art. o_O
     
    • Funny x 2
  11. sorka

    sorka Active Member

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    So there's one vote in the above 2.0 range. If that person voted correctly, they're saying their MS cost more than twice as much as what they make in a year????????
     
  12. ThisIsTrue

    ThisIsTrue Dismember

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    That's the way I'm reading it. Of course, they may have simply cashed in some stock, or otherwise had quite a nice savings account for "something nice". Again, what seems like a simple question has many complexities!
     
  13. sorka

    sorka Active Member

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    Heck, they could have $20 million and only be drawing just enough to live on and that is their income.
     
    • Like x 1
  14. LastGas

    LastGas Member

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    My Model S would equal almost exactly two years Social Security for my wife and I.
     
    • Like x 2
  15. avesraggiana

    avesraggiana Member

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    I’m probably in the You-Can’t-Really-Afford-It-So-Don’t-Even-Think-About-It category, in the 0.50-0.75:1.00 range. I have the money for a 10% downpayment if I’m required to pay that, and I’ve already decided to commit the ultimate act of financial longterm planning blasphemy by not maxing out my 401K contributions - at least until my next pay raise, next year.

    Completely, illogical, irrational and insane. But, screw it. The only debt I have is my house, and damnit, I want my Tesla before I’m too old to have fun driving it!

    Begs the question now, does anybody know what TTI ratio, amongst many other metrics, lenders are looking for when considering a loan on a Tesla S? I’m wondering if I’ll even get approved.

    Thanks.
     
  16. Max*

    Max* Banned

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    Banks don't care about your TTI, TTI is a made up statistic on TMC.

    Banks care about your credit score and DTI. Debt-To-Income.

    Take your monthly debt (your mortgage loan) then divide by your monthly income (your salary). Let's say your mortgage is $1k a month, but your gross monthly income is $10k, then your DTI is 10%. If you add a $1k car payment, your new DTI is 20%.

    Don't include things like utilities, child care, 401k contributions, etc. just recurring debt -- Credit card payments (I doubt people here have them, but why not), student loans, mortgage, rental property mortgage, HELOCs, etc. etc.


    IIRC my credit union wanted below 35% (that might have been where I'm at before the loan or total debt after the loan, I don't remember)
     
    • Like x 1
  17. avesraggiana

    avesraggiana Member

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    Thanks for taking the time to comment. You gave me one less thing to fret about. Did calculations on the parameters you listed and I’m at 30% with the Tesla loan. I believe I’ll be okay.

    Thanks again.
     
    • Like x 1
  18. Sully's8

    Sully's8 Member

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    Shocked at 2:1 tranche unless retirees on fixed income. . . I hope so.
     

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