photo (5)At the age of 26 I purchased my very own Ferrari. I had owned it for 20 months, travelled 5000 kilometres, shared the Ferrari ownership experience with over 30 people and have now moved on and sold it.  The Ferrari ownership experience only cost me $22 a day. How you ask? Well let’s find out!

I was able to purchase my Ferrari for a very reasonable price considering its condition. This was due to the rapport I had developed with the previous owner, understanding the market, the inherent difficulty in selling a Ferrari and my (wife’s) negotiation skills.

I purchased my Ferrari based on the condition, colour and specification. It wasn’t even the Ferrari I was initially after, I wanted the modern classic F355 model.

However buying the right model with a good history and specification makes it that much easier to move it on when the time comes, and I just could not find that perfect F355.

So in buying the right Ferrari you have to use your head not your heart. The reality is that it is easier to buy an exotic car than it is to sell one. Don’t make it harder by buying a strange colour combination, or a cheaper variant due to poor condition or history unless its significantly discounted and you factor in, that resale will take longer – up to 6-12 months.

My Ferrari 360 Spider, being red, manual, ordered with crème on black interior, very low mileage, good service history and immaculate paint was the best entry into Ferrari ownership within my budget and price point, in regards to reliability, drive-ability and the all important resale.

Here is a breakdown of the total cost of Ferrari ownership from purchase to sale:

Purchase price: =$X

Selling price: =$X

(Price is hidden for privacy and to protect the current owners investment, but the sale price was identical to purchase price).

Stamp duty: $Y

Stamp duty was a large outlay given the value of the car, but it was nullified due to the removal and sale of an aftermarket and very costly exhaust system that the previous owner had fitted to the car, along with carbon fibre air boxes.  I replaced both items with the stock components that were included with the car on purchase.

Refitting the stock exhaust on my own saved me paying for the labour cost and allowed myself to work on my own Ferrari – a thrill in itself.

So after the purchase price being matched with sale price, stamp duty covered with the selling off of aftermarket components we are now at a total of $0.

However the actual cost of Ferrari ownership was in the insurance, servicing and operating costs associated with the Ferrari over 20 months.

Running and insurance cost breakdown:

  • Green Slip $782.30
  • Pink Slip $35.70
  • Registration (including personalised number plates) $880
  • Comprehensive Insurance for 20 months: $6660
  • Annual Service – full fluid change $814
  • Diagnose fluid leak and repair $250
  • Install brake pads and bleed brake fluid $250
  • Brake Pads (all four corners) and Brake Fluid $921.40
  • Petrol: Premium unleaded 98 octane $1800

Total Ferrari ownership cost:

  • $12393.40 over 20 months
  • $619.67 per month
  • $154.91 per week
  • $22.13 per day! Cheaper than some peoples smoking habit and healthier too!

As you can see the main contributor to the cost of Ferrari ownership was the comprehensive insurance which is understandable given my age, performance and value of the car – you have got to pay to play! If I was older (over 30) it would have been even cheaper to cover the car and the total cost of Ferrari ownership could have been further reduced.

Further the car was purchased in cash so no interest was applicable. The only component not factored in here was the opportunity cost of having a 6-figure capital amount tied up in the vehicle for 20 months. The opportunity cost would differ from person to person, what you would/could have used that money for in that timeframe.

However the opportunity cost was worth the trade off for me, given my personal circumstances to live a life long dream, and in the experiences and friendships gained – some that are still occurring simply by entering into the Ferrari ownership club.

There was no cost incurred in selling the car, it was purchased off me sight unseen (without me advertising it) and I never met the buyer in person. It could not have been easier for me to sell it, and this all comes down buying a good car to begin with and building a good story around it, like my entering and winning the Ferrari Club Australia state concours for best Ferrari 360.

Ferrari ownership

So when people ask me why I sold the car, hopefully this post will answer their question. If you could have a Ferrari for $22 a day wouldn’t you? Selling the car at the price, and time that I did allowed me to pull off such a deal. Keep in mind I’m not even old enough to rent a Ferrari! Even if I was old enough it would be around 3 thousand dollars with, a 10k insurance bond to drive one solo for a weekend and its still not ‘yours’.

And of course there is always going to be another one.

Disclaimer: I don’t propose that it will only cost you $22 a day to experience Ferrari ownership – it could cost considerably more, especially if you buy a model that hasn’t yet fully depreciated, or a is a mechanical lemon. My particular situation, combined with luck, good financial literacy, Ferrari knowledge, and circle of influence allowed Ferrari ownership for $22 a day to occur. $22 a day for Ferrari ownership also makes it sound easy, but keep in mind the purchase price and getting your financial house of cards in order before making the jump will require time, effort, sacrifices and discipline.

It really only makes sound financial sense in buying your own Ferrari if you can value your resale at $0. Ferrari ownership with ‘accountant glasses’ on, is only long term sensible if you are able to write off the entire purchase price in your accounting and have a slush fund for any misc repairs. Because you might never sell it, and if you do sell it, anything you get for it will be a nice bonus. This is how many of the more affluent customers of Ferrari approach buying their brand new off the showroom cars, or that vintage model they always wanted growing up.

I may indeed lose more money on the next Ferrari, but the goal is to be in such a financial position to not really care about it. The next one could be a keeper!

I hope you enjoyed this post, remember nothing is promised in life, go out there and make your dreams a reality.

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Elliott