Frugality Gone Wrong: The Real Cost of Owning a BMW

BMW European Delivery

My new ride & I taking a pit stop in Switzerland–I get to keep the Euro plates

It’s no secret that I committed a PF sin back in the fall. After months years of contemplation, I pulled the trigger and ordered my first new car in over a decade.

When I placed the order in August, I made sure to detail my desire to take full advantage of the BMW European Delivery Program offered to any customers purchasing or leasing a new car. I also reserved a spot to take a re-delivery at the BMW Performance Center in South Carolina once the car arrived stateside (I’ve posted a full recap of the Welt portion of the experience…stay tuned for more!).

This weekend, I’m headed to SC for a full day of factory tours, race track driving and off-roading (yep, they give you a stock car to beat the snot out of on the track then take you off-roading in an X3 or X5). Can you tell I like my bimmers?  :)

While the EDP and Performance Center re-delivery are free to me as a buyer, what happens when I drive my shiny new car back to Boston? Basically, the reality of the real cost of owning a BMW will most likely slap me in the face.

The real cost of owning a BMW

I ordered a 3-series, a 328i, which is the mid-range vehicle BMW offers. Despite a fairly reasonable starting price (for a luxury car), the final tally including the options I opted for brought the final figure to….wait for it….just around $50K. Holy.shitballs.

Luckily, with all new cars, BMW offers free service for the first 4 years or 50,000 miles. This includes all oil changes, brake pads, fluids and discs, inspection services,  engine drive belts, wiper blades, etc. You’re also afforded free BMW Roadside Assistance for the first 4 years (no mileage restrictions) as well as BMW ConnectedDrive/Assist for 1 year.

But what about the other costs?

What about insurance, gasoline, parking and all the other miscellaneous expenses I’ll incur as penance for my sin? Obviously, if I spent this much money to buy the car, I’ll definitely be trying to take very, very good care of it. Unfortunately, that may mean more money being eaten up:

Insurance: My car insurance has gone up $53/month or $636 for the year.

Gasoline: Luxury vehicles require “luxury” gas (haha). Gone are my days of filling ‘er up with regular–I’ll now need to foot the bill for Plus or Super Plus. I’ll estimate that my gas expenditures will rise a modest $40/month (because we all know how much I love riding my bike to/from work!).

Depreciation: As with all new cars, the moment you drive that sucker off the lot (or out of the factory in my case), the depreciation clock begins to tick. It’s estimated that in the first year alone, my new 3 series will depreciate about $7,600.

Parking: I’ve added a new line-item to my budget for parking expenses. I won’t be paying to park in a garage on a regular basis (I have ample, free street parking in front of my house), but I will be paying to park in a garage whenever I venture into the city as I don’t trust anyone with my new bumpers. I’m budgeting $30/month for parking fees.

Total: Not including my monthly payment, I’m increasing my car-related expenses by at least $123/month or $1,476 for the year.

The fine print

Overall, this could be far worse–especially if you consider the potential costs had I chosen a luxury car that doesn’t include free maintenance services (costs estimated for first 4 years of ownership):


As any good PF blogger would do, I made sure to budget for these expenses (and practice living like I had to pay for them) BEFORE buying the car. I also ensured that I could still fund my retirement accounts, save, travel and basically keep my lifestyle the same as it is now.

Yes, this is a frivolous purchase. Yes, I could have purchased another car for far less money.

But with all that said, I’m still happier than ever about making this purchase because I love cars, love BMW and have planned/worked hard to make this a reality. Then again, talk to me a in a few years to see if it’s still worth it.  :)


What’s the most frivolous purchase you’ve recently made?

- Jen Smialek

Related Posts Plugin for WordPress, Blogger...


Freelancer; reformed spendaholic; risk taker; adventure seeker; world traveler; rose smeller; debt destroyer. My mission is to inspire others to live a healthy, balanced life one cent at a time.


Frugality Gone Wrong: The Real Cost of Owning a BMW56

  1. I will indeed be curious if it ends up being all it's cracked up to be. I sometimes think about replacing my car (a 2007 Civic which I bought new – it was a HUGE upgrade from my old early-80's toyota pickup in just about every category except utility) – stylish new cars catch my eye all the time. But I usually can beat back the urge by considering that newer, flashier cars come out all the time, and there's always a "new best thing." And, I don't get many opportunities to break into 5th gear in LA traffic anyway. My car is comfortable, gets good mileage, has enough power for my needs, and can get a little dirty without me worrying about it too much.

    • I had the exact train of thought, which is why I drove my current car pretty much into the ground over the past 11 years :)

      But for me it came down to being a car lover and really wanting to have the car. I've worked really hard to ensure it's not a complete financial bust, but it is certainly a pricey purchase!

  2. AWESOME. DH and I purchased a Hyundai Sonata Hybrid off the lot in 2011. It's a crazy expense, and I don't even want to think about the depreciation, but we L-O-V-E that car. It's been on so many roadtrips, and it carried us across the country to our new home (on about $200 worth of gas, no less!). The gas savings, and knowing we have a reliable vehicle make the expense seem worth it to us.
    My recent post Faceblog

  3. I think the picture is pretty sweet as well! Our last car purchase was bit like this, a fully loaded black Altima with 3 miles on it. I would love a BMW, but just can't swing it now. I echo Michelle's thoughts that if you have the money and can still save then go for it and enjoy it. :)

  4. This is why I like this genre — personal finance is just that — PERSONAL. I would not do that but I don't care about cars. You're clearly thrilled and you should be congratulated! :)

  5. I'll never spend that much on a car ever BUT it's not my thing. It's not my desire. And I'm glad 'cause 50K holy cow first of all and 2nd of all I'd never be able to afford that. If you really wanted it and considered all angles and can afford it more power to ya!! Enjoy it 'till the wheels fall off. I'd say splurges for me are designer jeans that cost $150!!
    My recent post More Sick People

    • Hahaha…yep–until the wheels fall off, indeed! I think your splurge is much more realistic…but I cringe if I spend more than $40 on jeans….it's always interesting to see the various splurge "priorities" people have!

  6. Congratulations! I remember you mentioning this on your blog last year and I wondered what happened. I think it is great! Hope you enjoy every minute of it.

  7. When I achieved financial independence, I bought a Mercedes 300E. I replaced my small BMW. I used to be quite taken with great cars. I got over it and I now own Hondas and Toyotas.

  8. Sweet! Great goal and you got it! Two friends picked up their cards in Bavaria. Loved the trip and had fantastic reports and pictures. Looks like you've getting the same treatment.

    My most frivolous purchase lately? I bought an expensive portable radio for the kitchen to listen to music while I cook. I made a commitment to cook many more meals this year than in the past (it's a great stress reliever, the food's better AND I save some cash). I'm not unhappy that I splurged, but I could have gotten a much cheaper radio.

    • They really know how to do it right–we've (BF went with me) been treated with an amazing level of service and support through every step of the process. And there's really nothing quite like being inside the Welt then DRIVING inside the Welt for car buffs like us–it was surreal! I'll definitely have some recap posts about the trips.

      I love the radio idea! I do the same while cooking, and I'm trying to cook more this year as well. I love how you pointed out the benefit of stress relief while cooking–I couldn't agree more!

    • Thanks, Rafiki! It was wild to hit publish on this post as I knew it might stir up some interesting responses. Then I realized that it's my money and choices and that I'm so happy I've worked so hard to get to this point. Only up from here as well!

    • Oh do I ever! I'm scared to drive it in the city because I don't want anyone near it…haha…but I love, love, looooove opening it up on the highway. Maybe I should budget for speeding tickets as well? :)

  9. You're pulling my heartstrings. Hubby and I have always wanted a BMW. We honeymooned in Germany and when we were in Munich and saw the BMV headquarters where, when you buy a new vehicle you can spend the day doing amazingly fun things, we decided that some day we will do just that. A girt after my heart! Enjoy it!

    Also that is freaking amazing about the maintenance for 4 years!!!
    My recent post How My Husband Landed a NHL Blogging Gig

    • Ahhh….that's the reason I got a new one!!! Otherwise, I'd never have done it because of depreciation alone–I would have definitely gotten a used one just off its lease.

      You'll love my recap post of the Euro Delivery–I was treated like a rock star, got to drive my car INSIDE the Welt and had a ridiculously good time. We had a 2-hour factory tour, got to see the Mission Impossible concept car (I touched it…shhh!) and they wined/dined us the whole time.

      This weekend they pick us up at the airport in a BMW, put us up in the hotel, feed us, transport us to the Center, give me a 2-hour overview and classroom driving session with a personal attendant, let me drive on the race track, and let me off-road in an X3 or X5…..all for FREE! The trips alone make up for the depreciation but regardless, this has been worth every.single.penny :)

  10. She's a beauty! Love the pic! I'm impressed at least your gas is only around 40/month! I work from home and my gas can be close to 100/month in LA. I really can't say I have made any extravagant purchases in a LONG time, but I will say that I haven't been willing to give up my 1400/month apartment. And believe me, it's hardly a luxury apt, it's just living in Los Angeles. But I despise the roommate thing and if I tried to find another place cheaper it would be in a bad area. Other than that, my major costs now are treating my shoulder to get it better, but that feels more of a necessity at this point.
    My recent post The Financial Pros and Cons of Getting Older

    • Oops…that's an additional $40/month…it will be about $100/month now instead of $60–sorry if I wasn't clear! Although in the summer, it will be more like $40 because I'll be biking to/from work each week. And this thing actually get amazing gas mileage compared to the beater car I have now!!!

      I commend you on the apartment lease—good for you for understanding that sometimes a roommate just isn't worth it! And obviously living in LA is crazy expensive; please don't move to a bad area :)

  11. Bought a new Toyota Aygo, because my last car Toyota Yaris went broke, which I bought in 2011 second hands. This worng buy costs 4.500 euro in one year. I am so disappointed, that i have said, when something goes wrong with this car. I finish car riding.
    For the travel from house to work I have a scooter and two bikes. It is easy to ride on a scooter and bikes in the Netherlands.
    The total costs for scooter and car, including gas costs me 390 euro for 6.000 km by car and 7.500 km by scooter.
    My recent post Het Consuminderhuis in Landgraaf

    • I would love to have a scooter! It's just not that safe here, unfortunately. But, I do have a bike and I bike to/from most places (including work) as much as possible. Sounds like you have a very good, responsible transportation system set up!

  12. Congrats on the ED experience, as well as PCD. I have done both, and they are certainly experiences worth doing again. With that said, the novelty of owning a BMW wore off for me pretty quickly, especially here in the U.S. where you can't even unleash it to its full potential on public roads. In the end, it just became a status symbol to me. This was back when my thinking was that if there is money left over in the budget after paying for car expenses then I could afford it. My priorities have changed since then. Now, I wish I didn't buy the car and just rented one in europe and paid for the M class at the Performance Center.

    Of course, this was my experience, and I hope yours goes to your benefit. Enjoy the car!

    • Thank you! Yes, I'm sure at some point reality will kick my in the butt, but I'm still over the moon about my car. A Valentine One will hopefully allow me to open up a bit without ending up in jail. :)

      I also plan to take this car to the track, so I'm sure that will help heighten the appeal of owning this thing!

      And my BF has an M3…let's just say I'm ruined :D

      • I don’t know if the 328′s come with run flats, but my 335 did. Those tires aren’t cheap. If you go to the track, you either have to buy another set or replace them sooner. I also found that the harder sidewalls on run flats were very susceptible to bubbles from potholes. Thought this was worth mentioning since I didn’t see tires as an expense.

  13. Love it! I’ve been eyeing the new 3 series for the past 6 months. Can’t wait for the new coupe to come out.

    I’m still sticking to my 1/10th rule of car buying. So hopefully I’ll join you once I get to 500k a year.



  14. I'm not into buying new cars, but the experience does sound like a blast. For that price, I would have bought a lightly used 335i with enough money to chip and tune it and get me 350 RWHP+! But I'm also with Sam on this one (I've been saying that a lot, lately), and wouldn't spend more than 1/10th my annual income on a car purchase. I also let the first owner of a vehicle eat all that depreciation for me and buy cars that are 5 – 7 years old at a minimum.

    But you're still saving $4k+ a month, so I don't think this purchase is going to kill your retirement plans, just not something I would personally do.
    My recent post Redecorate for Zero Dollars

    • I would definitely follow the path you mentioned above had it not been my first BMW purchase. This weekend alone has made the whole thing worth it, let alone the time in Europe.

      But this is absolutely a one-time deal for me–all future cars will be used but new-to-me!

  15. "As any good PF blogger would do, I made sure to budget for these expenses…" Actually, any good PF blogger would pay cash for their purchase. You mentioned monthly payments. Did you finance the car? If so, I hope it's because you got a killer rate and are doing something smart with the money in the mean time.
    My recent post File Taxes with Last Pay Stub?

    • I absolutely negotiated a rate that made sense to keep my cash in the bank (yep, financing until it makes sense not to; then I'll just send them a fat check) :)

      And I agree–usually the cash option would be best, but I also think making sure any option regardless of financing MUST fit in the budget (I would "pay back" the savings I took out if I had paid cash and that sum would need to fit in my monthly budget to justify reducing my savings so much).

      As noted above, the best thing about PF is the P–it's personal! :)

  16. I was in the Air Force stationed in England when I bought my BMW 328i in late 1999 ( a 2000 model). I got a great deal on it through military/embassy relationship. It was tax-free! until I shipped it back to the States a couple years later, and then I only had to pay taxes on what the current market value was at the time, and not the purchase price. I took a plane from London to Munich and picked it up there. Within 10 minutes of first sitting in the car, I was driving it on the autobahn. The guy at the factory said not to take it over 4000 rpm. In fifth gear, 4000 rpm is 100 mph! So I drove it back to England at slightly under 100 mph for the autobahn stretches. It now has about 145,000 miles on it and still drives great. I haven't had any major maintenance issues, just your normal oil changes, belts, hoses, tires, and brakes.

    • That's awesome!! I was warned of the 100mph, too. I broke that rule once I had it back here in the states while driving home from the Performance Center in SC….a hell of a trip! :)

      Great to hear it's still driving well…I'm assuming you've had a ton of fun with it!

  17. My most frivilous purchase is the 2012 Hyundai Sonata I bought in 2011. Brand new. Silly me. II'll be digging myself out of this fiscal whole just shy of indefinitely.

    Sidebar, my all time DREAM car is a BMW, but the costsssss!

  18. Amazing pic, and it sounds like you got the car for a good price. I'm sure that the enjoyment you get from owning the car will outweigh the costs. I am also planning to buy a 3 series, but hopefully a convertible demonstrator, as BMW have now discontinued the 3 series convertible. I've always been frugal where cars are concerned so I've gone back and forwards over whether to do this now or wait. But I've decided I will get more happiness out of owning the car than I would if I invested the money I would have spent on buying it. :)
    My recent post Miracles & Missing People – SILTW

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>

CommentLuv badge