Automobile Thread

[iamshack]

After all the talk about how much money to put into a car, I want to add two things...

 

1. Everyone has something, or some things, they spend "extra" on. Clothing, travel, cars, whatever. I try not to judge it. For me personally, cars have never been something I felt the need to spend big on. My wife and I have very successful careers, and our cars have been Honda, Subaru, Ford and Saturn. Just my preference, because...

 

2. Cars are NOT investments. No matter how you feel about how much you want to spend or whats important, you should get yourself out of that mindset. Cars are COST CENTERS. That doesn't mean you can't blow some extra money on them if it makes you happy - but they are all depreciating assets with an increasing cost curve. Cost centers.

No doubt about that.

 

But my life is not a business. I don't really take that viewpoint when viewing my personal finances. That isn't to say I walk around throwing money at rainbows, but running my life like a business is not something I choose to do.

Edited May 18, 2016 by iamshack

[southsider2k5]

After all the talk about how much money to put into a car, I want to add two things...

 

1. Everyone has something, or some things, they spend "extra" on. Clothing, travel, cars, whatever. I try not to judge it. For me personally, cars have never been something I felt the need to spend big on. My wife and I have very successful careers, and our cars have been Honda, Subaru, Ford and Saturn. Just my preference, because...

 

2. Cars are NOT investments. No matter how you feel about how much you want to spend or whats important, you should get yourself out of that mindset. Cars are COST CENTERS. That doesn't mean you can't blow some extra money on them if it makes you happy - but they are all depreciating assets with an increasing cost curve. Cost centers.

 

This. Totally this.

[NorthSideSox72]

No doubt about that.

 

But my life is not a business. I don't really take that viewpoint when viewing my personal finances. That isn't to say I walk around throwing money at rainbows, but running my life like is business is not something I choose to do.

 

I think it has to be a balance. That's kind of what I was getting at - everyone spends money on things they like that aren't necessarily logical or financially smart. Used to be travel for my wife and I (not so much anymore with young kids). But if you don't also keep track of your finances, as any business does, you can find yourself in trouble.

 

Wanting a cool car isn't wrong. Just don't think of it as an "investment", because it isn't. It's a luxury spend. Which is also fine.

 

[iamshack]

I think it has to be a balance. That's kind of what I was getting at - everyone spends money on things they like that aren't necessarily logical or financially smart. Used to be travel for my wife and I (not so much anymore with young kids). But if you don't also keep track of your finances, as any business does, you can find yourself in trouble.

 

Wanting a cool car isn't wrong. Just don't think of it as an "investment", because it isn't. It's a luxury spend. Which is also fine.

Has the word "investment" even been used in this thread?

[StrangeSox]

If you had bought basically any 911 other than the late 90's/early 00's one five years ago, you'd double your money if you sold it now (or triple or quadruple, depending on the specific model). What I'm saying is that you'd be a fool to not buy a luxury sports car!

[RockRaines]

Has the word "investment" even been used in this thread?

Buying a new car will never be a financial investment, but for me its a pleasure investment. I need a luxury car, otherwise I am super unhappy.

[Iwritecode]

Sometimes when you drive alot that tool needs to be extremely comfy with lots of bells and whistles!!!

 

Totally this.

 

I spent 11 years driving 30+ miles one-way for my first job and almost 5 years driving 90 miles one-way at my previous job. So I've always had to make sure my cars were not only reliable, but comfortable as well considering how much time I spent in them. Fuel efficiency was also a big factor so more often than not, the newer the better.

[iamshack]

Honestly, some people seem to obsess so much over the precise manner in which to spend their money that they detract from their enjoyment of it.

 

I am going to enjoy my life while I live it. That isn't to say that I don't save for retirement. My wife and I are a dual income family and we both invest more than 10% of our salaries on an annual basis in 401k accounts. We currently own 3 homes. So it is a balance between today and in the future.

 

So I agree with what NSS said, but even the manner in which he said it was oozing with judgment, even though I suspect it was unintentional.

 

I happen to like driving, and I happen to love cars. I also love clothes and sneakers, too. I love golf. I love tvs and computers and stereo equipment. Those are the things I spend my discretionary income on.

 

I am 39 now. When I am 70, I hope I can look back on my life, perhaps with a slightly smaller pile of money than some of you more financially-sound investors, and smile, remembering what it was like to drive a sportscar over 130 mph, or to walk into a meeting with a suit that fit like armor, or to smoke a drive 350+ yards down the middle of the fairway, etc. To me, that is much more valuable than an extra 20% to enjoy when I am urinating on myself and drinking Ensure through a straw.

Edited May 18, 2016 by iamshack

[StrangeSox]

That is an easier argument to make when your income gives you a fair amount of disposable income, though.

[NorthSideSox72]

Honestly, some people seem to obsess so much over the precise manner in which to spend their money that they detract from their enjoyment of it.

 

I am going to enjoy my life while I live it. That isn't to say that I don't save for retirement. My wife and I are a dual income family and we both invest more than 10% of our salaries on an annual basis in 401k accounts. We currently own 3 homes. So it is a balance between today and in the future.

 

So I agree with what NSS said, but even the manner in which he said it was oozing with judgment, even though I suspect it was unintentional.

 

I happen to like driving, and I happen to love cars. I also love clothes and sneakers, too. I love golf. I love tvs and computers and stereo equipment. Those are the things I spend my discretionary income on.

 

I am 39 now. When I am 70, I hope I can look back on my life, perhaps with a slightly smaller pile of money than some of you more financially-sound investors, and smile, remembering what it was like to drive a sportscar over 130 mph, or to walk into a meeting with a suit that fit like armor, or to smoke a drive 350+ yards down the middle of the fairway, etc. To me, that is much more valuable than an extra 20% to enjoy when I am urinating on myself and drinking Ensure through a straw.

 

I think it has to be a balance. That's kind of what I was getting at - everyone spends money on things they like that aren't necessarily logical or financially smart. Used to be travel for my wife and I (not so much anymore with young kids). But if you don't also keep track of your finances, as any business does, you can find yourself in trouble.

 

Wanting a cool car isn't wrong. Just don't think of it as an "investment", because it isn't. It's a luxury spend. Which is also fine.

 

I guess I don't see the judgment here. The differentiation between investment and cost center is not subjective, or judgmental - it is a state of being, and a financial reality. I don't now, nor ever have, thought less of people who spend big money on cars. Hell I love me some sports cars when I get a chance to ride or drive in one. It just means, when I see people talk about an investment (which I hear a lot), I cringe because it indicates a dangerous lack of understanding and I fear for the results of that.

 

I guess really, I do judge, but only insofar as people who I see make mistakes that I think stem from a lack of knowledge. Not because they CHOOSE to spend the money, or HOW they do it, or on WHAT. Does that make more sense?

 

[iamshack]

That is an easier argument to make when your income gives you a fair amount of disposable income, though.

Well, it's also about priorities as well. I live in Nevada, and pay about $1600 in annual property taxes. There is no state income tax here. It is dirt cheap to live here.

 

Additionally, we've purchased a home that cost about 20% of what we qualified for a loan on. So our monthly nut isn't nearly as high of a percentage of our net monthly income as most, I suspect.

[Texsox]

I have friends who retired when they turned 50. She was a school teacher, he was a commercial diver. On a bad year they saved 50% of their net income. They lived very simply while they were working. Now they live aboard their sailboat. Yes, they sacrificed the first have of their adult life to have a long retirement while they are healthy enough to live an adventure. I didn't know anyone like that until I was in my 40s. I thought retiring at 50 was for the super wealthy with amazing jobs. At the minimum I wish someone had pointed out that option. I may not have followed their example, but I wish I had at least considered it. So when someone makes financial suggestions, here, there, or anywhere, I enjoy reading them. One example NSS talked about "sweeping" his end of month balances into a savings account. I've been doing that in additional to my regular savings and investments and it has made a noticeable difference in my savings.

 

I also started micro investing my "round ups" on purchases at Acorn acorns.com/invite/CYA7DP basically you can open an account with a deposit if $5 or so. They track your purchases and "round up" each transaction and place it in a mutual account. You can get started for next to nothing. The danger is the $1 per month fee cuts into any profits on the investment.

[iamshack]

I guess I don't see the judgment here. The differentiation between investment and cost center is not subjective, or judgmental - it is a state of being, and a financial reality. I don't now, nor ever have, thought less of people who spend big money on cars. Hell I love me some sports cars when I get a chance to ride or drive in one. It just means, when I see people talk about an investment (which I hear a lot), I cringe because it indicates a dangerous lack of understanding and I fear for the results of that.

 

I guess really, I do judge, but only insofar as people who I see make mistakes that I think stem from a lack of knowledge. Not because they CHOOSE to spend the money, or HOW they do it, or on WHAT. Does that make more sense?

I was referring more to the post before that, where you mentioned you and your wife have successful careers but have always purchased Fords, Saturns, etc.

 

That being said, no big deal...it's just a hot button of mine that a few have pressed the last couple days in this thread.

[iamshack]

I have friends who retired when they turned 50. She was a school teacher, he was a commercial diver. On a bad year they saved 50% of their net income. They lived very simply while they were working. Now they live aboard their sailboat. Yes, they sacrificed the first have of their adult life to have a long retirement while they are healthy enough to live an adventure. I didn't know anyone like that until I was in my 40s. I thought retiring at 50 was for the super wealthy with amazing jobs. At the minimum I wish someone had pointed out that option. I may not have followed their example, but I wish I had at least considered it. So when someone makes financial suggestions, here, there, or anywhere, I enjoy reading them. One example NSS talked about "sweeping" his end of month balances into a savings account. I've been doing that in additional to my regular savings and investments and it has made a noticeable difference in my savings.

 

I also started micro investing my "round ups" on purchases at Acorn acorns.com/invite/CYA7DP basically you can open an account with a deposit if $5 or so. They track your purchases and "round up" each transaction and place it in a mutual account. You can get started for next to nothing. The danger is the $1 per month fee cuts into any profits on the investment.

Tex, that's great. There is definitely something to be said for taking early retirement.

 

That said, I love what I do. That isn't to say I want to work the rest of my life, but I am one of those people that enjoy being in a position to impact others for the better, being in a competitive environment, being in a stimulating environment, etc.

 

Let's just say someone croaked and left me $20 million tomorrow. I don't know that I would stay in my current job, but I suspect I would definitely continue to work in some form or fashion.

[Texsox]

I was referring more to the post before that, where you mentioned you and your wife have successful careers but have always purchased Fords, Saturns, etc.

 

That being said, no big deal...it's just a hot button of mine that a few have pressed the last couple days in this thread.

 

And you have argued that side as fervently as some of the other point of views. In a sense telling people how and what to post about. And that is what makes this forum great. We do toss ideas back and forth without many taboo subjects. If this was more anonymous, with less long term relationships I would be more inclined to agree with your point of view. But after 10+ years reading some people's posts, financial advice on how to manage major purchases is something I like reading.

[RockRaines]

f***, I wouldnt work. I would do nothing. I got a pretty sizeable severance payment at a job years ago and I didnt do s*** until I had to.

[Texsox]

Tex, that's great. There is definitely something to be said for taking early retirement.

 

That said, I love what I do. That isn't to say I want to work the rest of my life, but I am one of those people that enjoy being in a position to impact others for the better, being in a competitive environment, being in a stimulating environment, etc.

 

Let's just say someone croaked and left me $20 million tomorrow. I don't know that I would stay in my current job, but I suspect I would definitely continue to work in some form or fashion.

 

It's about choices. I was reminded of that when you mentioned urinating on oneself while sipping Ensurer through a straw. With the magic of compounded interest, dropping $10k in your 20s is a much bigger deal than in your 40s. I would like my grandchildren to know what your thoughts are on auto expenses when you are 60. I think it would be interesting. Advice from people in a different stage of their lives, especially ones I will be getting to can be very valuable.

[iamshack]

And you have argued that side as fervently as some of the other point of views. In a sense telling people how and what to post about. And that is what makes this forum great. We do toss ideas back and forth without many taboo subjects. If this was more anonymous, with less long term relationships I would be more inclined to agree with your point of view. But after 10+ years reading some people's posts, financial advice on how to manage major purchases is something I like reading.

Fair enough, Tex.

[iamshack]

It's about choices. I was reminded of that when you mentioned urinating on oneself while sipping Ensurer through a straw. With the magic of compounded interest, dropping $10k in your 20s is a much bigger deal than in your 40s. I would like my grandchildren to know what your thoughts are on auto expenses when you are 60. I think it would be interesting. Advice from people in a different stage of their lives, especially ones I will be getting to can be very valuable.

Well, you have your view, I have mine. After speaking with my grandparents, as well as other seniors, I hear a lot more stories reminiscing about the days when they were young and all the great times they had than complaining about not having another $50k to piss away in some senior care center that charges them $900 a day.

[NorthSideSox72]

I was referring more to the post before that, where you mentioned you and your wife have successful careers but have always purchased Fords, Saturns, etc.

 

That being said, no big deal...it's just a hot button of mine that a few have pressed the last couple days in this thread.

I also said we traveled a lot - which others probably find to be an even bigger waste of money. It was an illustration of differences, not better than or worse than.

 

[iamshack]

I also said we traveled a lot - which others probably find to be an even bigger waste of money. It was an illustration of differences, not better than or worse than.

Well, I think that is a perfect example! My wife enjoys to travel and I don't, so we've had the discussion in re: travel vs. cars/home improvements, etc.

 

To me, it all comes back to whatever makes one happy.

[Texsox]

Well, you have your view, I have mine. After speaking with my grandparents, as well as other seniors, I hear a lot more stories reminiscing about the days when they were young and all the great times they had than complaining about not having another $50k to piss away in some senior care center that charges them $900 a day.

 

Exactly the point. Why wait to retire in your 60s if it means some senior care center? How about a thirty year retirement before that? How many people are you talking to that retired in their late 40s and 50s? I didn't have any. Based on the people you mention, I agree. Spend it now.

 

Planning retirement backwards. If you want to retire at 50, figure out the financial factors and do that. If you want to retire and move to a senior care facility that is another equally valid approach. Spend now, work longer. Spend less now, retire earlier. It's a choice we make, I'm just not certain how much we really spent thinking about it until it is too late.

[RockRaines]

Exactly the point. Why wait to retire in your 60s if it means some senior care center? How about a thirty year retirement before that? How many people are you talking to that retired in their late 40s and 50s? I didn't have any. Based on the people you mention, I agree. Spend it now.

 

Planning retirement backwards. If you want to retire at 50, figure out the financial factors and do that. If you want to retire and move to a senior care facility that is another equally valid approach. Spend now, work longer. Spend less now, retire earlier. It's a choice we make, I'm just not certain how much we really spent thinking about it until it is too late.

Planning is great and all unless something bad happens. I am going to have a heart attack at some point, so should I load up on life insurance and spend money now or save a ton of money to retire even though I may not make it there. Delicate balance.

[bmags]

Honestly if you all are saving money for retirement now you are doing better than a vast majority of Americans.

As of last year, the figure stood at 5.1 percent, and according to McClary, nearly 30 percent of American adults don’t save any of their income for retirement.

http://www.theatlantic.com/magazine/archiv...t-shame/476415/

[Texsox]

Planning is great and all unless something bad happens. I am going to have a heart attack at some point, so should I load up on life insurance and spend money now or save a ton of money to retire even though I may not make it there. Delicate balance.

 

Most people don't make the choice. They just do whatever without much thought. If I realized $5,000 saved in my 20s was one less year to work, I may have managed things differently. But I just kind of followed the path of least resistance. Put a little in an IRA.