I understand fully, that to many people that are in the econo mode, that a car is a basic A to B, turn the key, that's it appliance. I know a Prius owner, and I am giving a single viewpoint by the way. Her car is nothing more than a sit and drive car that enables her to drive over an hour each way to work daily... cheap. There is no better word to describe her thoughts. Money saved for malls and shopping. Other than the paint color choice and Bluetooth, there is zero interest in the car.
In turn there is value in quality of life over cheapness. If every few years (not months) you can actually pick a new model with many of the newest amenities, tired design elimination, better drivability and so on.
I have remained in some homes for a while, and I'm always updating them or moving up or even downsizing as well. I actually believe one can become more successful in life making changes, and not being locked in to such a tight path. To drive the same vehicle 10 or more years also becomes a maintenance issue and often a dated eyesore. Interiors get beat, paint fades and engines are complex.
Lastly, being a millionaire, being at the end of your career without a pension, is not the dramatic amount of money you think. People live longer and you need to take some risks to survive while you are working. I like having a healthy balance, and lifestyle vs deprivation to get there financially.
We have differing opinions, which is fine. And the point being made about a million not necessarily being "a lot" today bears witness to how much it costs to live. The saying goes that if you retire at 60 and live to be 100 (totally feasible) then you will need a million dollars in order to have an income of about 40k a year... which even in the lower cost areas of the country is basically a whole lot of nothin'.
So that comes back to some previous points, which is that in order to get to that number requires restraint for most people. It seems to me that most people go out and buy houses that use up most of their incomes, buy or lease new cars every 3-5 years, buy nice things like flatscreen TV sets, the latest gadgets, and so on. All the while without really saving much of anything, let alone have any retirement plan. It's shocking how many out there have absolutely zero in retirement savings. A lot of that comes from frivolous spending habits. Assuming that someone were to buy a new, decent car every 4-5 years, that means in an average professional career, they could have spent upwards of eight cars and assuming that they cost 30k each, that's $240,000 in cars alone. Now - assuming they had kept their cars for 15-20 years each, that number suddenly becomes more like 60k.
Anyway, we can have our own ways of debating the "right" way to spend money. There's not really a correct answer.
BTW, you can have your cake and eat it too: My 'other' car is a classic 50's Mercury, and yes - I will admit it beings me a lot of joy to drive. Plus it only cost me $1,800.
Say you make 100k a year and put 10k a year away. Are you going to retire on that? In turn if you buy great classic cars and flip, or flip properties and work at same time, you can live well. You have to buy smart. I take profit and invest for more profit. I can't see how that's risk. Few people make it to 100, but if you quit work at 60, it's not what Suzie Ormann would tell you usually. I do not do car loans and own my home. You have to live somewhere. Not everybody is Donald Trump, but he buys when the economy is bad. Sit on paper, you do the same thing, except you own a real asset. I have seen guys buy cars under 20k and sell for 6 figures, just keeping them stored. And you can have fun with them. I don't get that thrill opening an envelope every quarter.
I bought my very first used car off Auto Trader for only 150, and flipped it for 400 a few days later. It was a tagged 71 Capri with a bad motor, but had a sunroof. I didn't do anything more than detail it. The sunroof was what I bought it for, and what the buyer liked too.
The initial 150 went back in the bank. That 300 profit got flipped many times, one car at a time.
My wife and I work full time and have auto deductions in the interim. I did a refi cash out and bought a small rental townhouse. Over the next 16 years, the same tenant with positive rental, it got me into the next one. With bank issues, government shutdowns, and wait til the stock market drops, you need to do more today on your own. How about having a rental paid for? That was always positive. Now pay for your cars. I even did a lease purchase on my second rental on year 3. Even after capital gains, I like it.
I'd rather own a hard asset than be in the volatile economy, hoping my money is safe, and get loads on it too.
Well, we sold the Prius and bought a Chevy Volt. So to summarize I'd say this: While I was initially unimpressed with the car, having owned it for 6 years and put over 200,000 miles on the clock, the car proved to be reliable and economical. It also put to rest the notion that the main batteries in these are failure-prone as many naysayers claimed when these cars came out. Almost 13 years and 200,000 miles is pretty good for a set of batteries, regardless of type.
I'd say my major gripe for this model was that the interior and overall level of options was very spare and limited. This was the first Gen of the Prius, and it seems that the major focus on its development was the powertrain, which for the time was a feat of engineering. The car itself though was at the same level as an entry level econo car. I've ridden in newer Prius models that are a lot nicer.
But basically, it did what it was supposed to do. It got us to work year in, year out, delivered an average fuel economy of 45+ MPG, was cheap and easy to maintain, and saved us what I figure to be a total of around $11,000 in gas savings over its time with us.
Here's another variable; your health at old age. I pursued many hobbies including skydiving, white water rafting, and travel, all while I was young. Drove some neat cars and they kept me fulfilled and out of the doctor office. When you get old, you can lose your fortune in a nursing home or not able to enjoy it physically. My uncle dropped dead at 56. Did everything on the cheap, ate poorly to skimp and save. You can go into senior apts based on income. The more you have, the more they take. I do not need 40k a year at retirement. If I did, I would move out of the area and move to Florida. And not drive some little beater for 40 years in bumper to bumper traffic in the rat race. To me quality of life has great value. Not deprivation to get there.
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