I am 25 working in New York city making ~117k a year. After tax and various pre-tax deductions, (mta fare etc) my take home is just shy of 6k a month.
I pay $1875 in rent a month for a nice apartment with a roommate in a good location. This equates to 19% of my yearly pre-tax income.
I purchased a used (2011, low miles) sedan in early 2014 for ~28k, 9 months before moving to the city. I put 12k down including trade in and currently owe 9k on the car (1.9% APR). It's a luxury sedan (not a 3 series, hah!) and will hold it's value better than other cars for quite a while (currently worth ~23k in private sale).
The costs of owning the car include a $400 monthly payment towards the principal (can make higher or lower as needed), $350 for a garaged parking spot, and $140 a month in insurance. All in, with gas, it ends up being right around $1000 dollars a month to keep the car in the city, making it 10% of my annual income. Sunk costs being the parking and insurance.
Why even own a car you might ask? Well I travel home (~320 miles one way) fairly regularly, 2-3 times every 2 months. Renting a car is as much a $600 dollars a weekend. Flying is also an option but flights are usually $300-400 + Uber and have to be booked in advance. Not to mention the fact that I don't have a car once home if I'm there for more than just the weekend. I also use the car for weekend trips quite often around the city so I do actually get good use out of it. I also really enjoy cars and driving in general.
I have ~16k in student loans that I am slowly paying off. They have an extremely low interest rate so I'm not really in a huge rush. ~$300 towards principal per month.
Additionally I have 5-6 month emergency fund saved up and could obviously trade in the car quickly if I ever got into a serious bind.
Other funds include rolled over 401k from previous job and new 401k.
The biggest downside of all of this is that I am only able to save on average $600 dollars to contribute to either the new 401k or savings. This is obviously not enough, I know.
If I continue as I am now, I can pay off both the car and student loans in less than two years. I know you shouldn't count future income, but I will likely get another 10% raise at years end).
My question to you all is, am being seriously irresponsible by keeping the car? Or is it not quite as big of a deal as I think because the car actually has value and isn't entirely a sunk cost? Are there any other suggestions for transportation or ways to keep a car that I am not thinking of with a better financial outcome? Selling/leasing? (I don't think would be beneficial.)
Any advice would be appreciated! Thank you!