Realistically speaking, if someone made 35K a year and is single...
06-25-2013, 02:17 PM
#61
1- cars are money pits. (why I never buy new).
2- unless you live in a low property tax state, so are houses.
3- Anyone can buy a Porsche. There are 1,000 1999-2012 Carreras on Autotrader right now.
And God knows how many Caymans, Boxsters, Cayennes and Panameras.
4- The single biggest thing going for you as a young person with no debt and savings is the time value of money. The notion that you need a huge pile of cash so you can turn it into a huge-r pile is a myth.
Even if its only $25K, you need TIME to let that money grow. You will ONLY have this advantage of a long investment window when you are young. Once you're in your 30's and 40's that 15-20 years of letting money grow is gone forever. By then you might have responsibilities that mean you have this much in savings: $0.
Most young people today and yesterday, **** this away this advantage buying Porsches and Range Rovers.
When I first had an oppourtunity to buy an expensive car I was very young but already investing in the markets for many years, no obligations. This was not money given to me by family or some rich aunt by the way. I could have purchased any Porsche, but I decided not to buy a Porsche. I bought a Japanese car instead. The Porsche would have to come later. And even when I did buy the Porsche, once again I could have purchased something very expensive. I decided I would ignore price and buy what met all my needs. I gave the bank back most of their loan amount, figuratively speaking, and kept my cash umolested, in part because I had a feeling that stocks, houses and assets were going to get real cheap in the not too distant future. And boy did they. I plowed money into the market when it lost half its value in a blink. Moral of the story, if you want to play you need cash. And when it comes to investing, you will never have as much of it as you would like.
Guard your cash, the Porsche mechanic near you has enough of it already.
2- unless you live in a low property tax state, so are houses.
3- Anyone can buy a Porsche. There are 1,000 1999-2012 Carreras on Autotrader right now.
And God knows how many Caymans, Boxsters, Cayennes and Panameras.
4- The single biggest thing going for you as a young person with no debt and savings is the time value of money. The notion that you need a huge pile of cash so you can turn it into a huge-r pile is a myth.
Even if its only $25K, you need TIME to let that money grow. You will ONLY have this advantage of a long investment window when you are young. Once you're in your 30's and 40's that 15-20 years of letting money grow is gone forever. By then you might have responsibilities that mean you have this much in savings: $0.
Most young people today and yesterday, **** this away this advantage buying Porsches and Range Rovers.
When I first had an oppourtunity to buy an expensive car I was very young but already investing in the markets for many years, no obligations. This was not money given to me by family or some rich aunt by the way. I could have purchased any Porsche, but I decided not to buy a Porsche. I bought a Japanese car instead. The Porsche would have to come later. And even when I did buy the Porsche, once again I could have purchased something very expensive. I decided I would ignore price and buy what met all my needs. I gave the bank back most of their loan amount, figuratively speaking, and kept my cash umolested, in part because I had a feeling that stocks, houses and assets were going to get real cheap in the not too distant future. And boy did they. I plowed money into the market when it lost half its value in a blink. Moral of the story, if you want to play you need cash. And when it comes to investing, you will never have as much of it as you would like.
Guard your cash, the Porsche mechanic near you has enough of it already.
06-25-2013, 02:30 PM
#62
I'll paraphrase a line from the movie The Social Network: you know what's cooler than owning a used Porsche in your 20s? Paying cash for a new Porsche in your 30s with a million dollars worth of savings in the bank from all your hard work over the last 15-20 years.
Say it with me: delayed gratification. For those of us that didn't grow up with a trust fund, a Porsche is a reward for a lifetime of hard work. Trust me, it will feel good when you know you've earned it and can do it without overstretching to get there.
Play the cards you've been dealt right, make smart decisions, and the rewards you seek will be yours in time.
Say it with me: delayed gratification. For those of us that didn't grow up with a trust fund, a Porsche is a reward for a lifetime of hard work. Trust me, it will feel good when you know you've earned it and can do it without overstretching to get there.
Play the cards you've been dealt right, make smart decisions, and the rewards you seek will be yours in time.
06-25-2013, 02:36 PM
#63
Three Wheelin'
I agree with you completely. This statement perfectly captures the OP's disconnect with some of the advice that's been given to date.
You say "only $25K" while the OP is (rightfully) losing sleep over the "$25K" because it sounds like it's essentially his life savings. I don't mean to diminish the value of $25K. It is a lot of money but when $25K represents everything you (TheLastTemplar) has, you don't spend it on a used car...or any car.
-Eric
You say "only $25K" while the OP is (rightfully) losing sleep over the "$25K" because it sounds like it's essentially his life savings. I don't mean to diminish the value of $25K. It is a lot of money but when $25K represents everything you (TheLastTemplar) has, you don't spend it on a used car...or any car.
-Eric
Last edited by Sue Esponte; 06-25-2013 at 03:06 PM.
06-25-2013, 04:23 PM
#64
^Agreed.
To the OP, there is a great movie called "Broke" on NetFlix. Its a sports documentary claiming that like 80% of all professional athletes are bankrupt within three years of retirement. Why? Because as soon as they got money they spent it. They never actually learned about diversification in asset classes, (the right way). Instead they all buy sports cars and car washes that fold.
The worst appear to be the NFL players. Since their season is short, and they are only paid by their teams during the season, many are flat broke by week 1 of the next season. Once they're released/cut still in their 20's, no more checks. The oppourtunity to watch a few million dollars grow over 20 years, at which point they still would be only in their late 40's, gone forever. I blame the colleges for never taking their prized athletes aside and saying "this is a fiduciary. He will help you to understand something about retirement planning". They leave college just as financially illiterate as they came in.Ditto for the non-athletes, except they leave with a $30K-$100K bill.
To the OP, there is a great movie called "Broke" on NetFlix. Its a sports documentary claiming that like 80% of all professional athletes are bankrupt within three years of retirement. Why? Because as soon as they got money they spent it. They never actually learned about diversification in asset classes, (the right way). Instead they all buy sports cars and car washes that fold.
The worst appear to be the NFL players. Since their season is short, and they are only paid by their teams during the season, many are flat broke by week 1 of the next season. Once they're released/cut still in their 20's, no more checks. The oppourtunity to watch a few million dollars grow over 20 years, at which point they still would be only in their late 40's, gone forever. I blame the colleges for never taking their prized athletes aside and saying "this is a fiduciary. He will help you to understand something about retirement planning". They leave college just as financially illiterate as they came in.Ditto for the non-athletes, except they leave with a $30K-$100K bill.
06-25-2013, 07:08 PM
#66
I don't think they pay the unions to educate them on the basics of finance.
And I can't think of a good reason why this education shouldn't be included, or better yet required, as part of any insanely over-priced four year college degree.
I was required to know that there are basalt formations under NJ but not how your average corp. 401K plan is taking you to the cleaners on excessive fees not included in mutual fund expense ratios.
And I can't think of a good reason why this education shouldn't be included, or better yet required, as part of any insanely over-priced four year college degree.
I was required to know that there are basalt formations under NJ but not how your average corp. 401K plan is taking you to the cleaners on excessive fees not included in mutual fund expense ratios.
06-25-2013, 10:47 PM
#67
Race Director
I don't think they pay the unions to educate them on the basics of finance.
And I can't think of a good reason why this education shouldn't be included, or better yet required, as part of any insanely over-priced four year college degree.
I was required to know that there are basalt formations under NJ but not how your average corp. 401K plan is taking you to the cleaners on excessive fees not included in mutual fund expense ratios.
And I can't think of a good reason why this education shouldn't be included, or better yet required, as part of any insanely over-priced four year college degree.
I was required to know that there are basalt formations under NJ but not how your average corp. 401K plan is taking you to the cleaners on excessive fees not included in mutual fund expense ratios.
These individuals tend to rely on others for this advice, and its not always good advice.
06-25-2013, 10:52 PM
#68
Three Wheelin'
But, point taken on the union's obligations. I agree that it isn't really their responsibility. If there's anyone to blame it's really the parents who should have given them some of these fundamentals but they're probably among the offenders encouraging them to spend their earnings away.
-Eric
06-26-2013, 12:58 AM
#69
Rat Balls
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OP... I just realized you started another thread awhile back asking which Pcar color is the most desirable. I hope your investment in a 996 doesn't come down to that. BTW...the correct answer is Guards Red.
06-26-2013, 02:49 AM
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Guys, having read more on minimalism and reading interviews on true, hardcore minimalists... I can say money is an illusion created a long time ago. Money only exists if 2 people believe in it. And obviously, MANY folks do believe in it like myself. However, money can always be made back, whereas time-- once it's gone, you can't get it back. So money is just that, an illusion, and unfortunately it is something one needs to get a Porsche, haha.
If anyone here has watched videos on "small spaces" from Youtube, you will know many folks have their own homes, all paid for-- usually around the price of a used 1999 Carrera for example, meaning 25K or a bit less.
Seriously, besides wanting a Porsche, I have no other big ticket material goals in mind except for a Ninja 500R. I don't live lavishly and don't really intend to.
So if I made 35K a year or 40K, I am sure I can set aside $3500 a year put it into a bank account, and not use it unless it's car related.
If anyone here has watched videos on "small spaces" from Youtube, you will know many folks have their own homes, all paid for-- usually around the price of a used 1999 Carrera for example, meaning 25K or a bit less.
Seriously, besides wanting a Porsche, I have no other big ticket material goals in mind except for a Ninja 500R. I don't live lavishly and don't really intend to.
So if I made 35K a year or 40K, I am sure I can set aside $3500 a year put it into a bank account, and not use it unless it's car related.
06-26-2013, 02:56 AM
#71
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1- cars are money pits. (why I never buy new).
2- unless you live in a low property tax state, so are houses.
3- Anyone can buy a Porsche. There are 1,000 1999-2012 Carreras on Autotrader right now.
And God knows how many Caymans, Boxsters, Cayennes and Panameras.
4- The single biggest thing going for you as a young person with no debt and savings is the time value of money. The notion that you need a huge pile of cash so you can turn it into a huge-r pile is a myth.
Even if its only $25K, you need TIME to let that money grow. You will ONLY have this advantage of a long investment window when you are young. Once you're in your 30's and 40's that 15-20 years of letting money grow is gone forever. By then you might have responsibilities that mean you have this much in savings: $0.
Most young people today and yesterday, **** this away this advantage buying Porsches and Range Rovers.
When I first had an oppourtunity to buy an expensive car I was very young but already investing in the markets for many years, no obligations. This was not money given to me by family or some rich aunt by the way. I could have purchased any Porsche, but I decided not to buy a Porsche. I bought a Japanese car instead. The Porsche would have to come later. And even when I did buy the Porsche, once again I could have purchased something very expensive. I decided I would ignore price and buy what met all my needs. I gave the bank back most of their loan amount, figuratively speaking, and kept my cash umolested, in part because I had a feeling that stocks, houses and assets were going to get real cheap in the not too distant future. And boy did they. I plowed money into the market when it lost half its value in a blink. Moral of the story, if you want to play you need cash. And when it comes to investing, you will never have as much of it as you would like.
Guard your cash, the Porsche mechanic near you has enough of it already.
2- unless you live in a low property tax state, so are houses.
3- Anyone can buy a Porsche. There are 1,000 1999-2012 Carreras on Autotrader right now.
And God knows how many Caymans, Boxsters, Cayennes and Panameras.
4- The single biggest thing going for you as a young person with no debt and savings is the time value of money. The notion that you need a huge pile of cash so you can turn it into a huge-r pile is a myth.
Even if its only $25K, you need TIME to let that money grow. You will ONLY have this advantage of a long investment window when you are young. Once you're in your 30's and 40's that 15-20 years of letting money grow is gone forever. By then you might have responsibilities that mean you have this much in savings: $0.
Most young people today and yesterday, **** this away this advantage buying Porsches and Range Rovers.
When I first had an oppourtunity to buy an expensive car I was very young but already investing in the markets for many years, no obligations. This was not money given to me by family or some rich aunt by the way. I could have purchased any Porsche, but I decided not to buy a Porsche. I bought a Japanese car instead. The Porsche would have to come later. And even when I did buy the Porsche, once again I could have purchased something very expensive. I decided I would ignore price and buy what met all my needs. I gave the bank back most of their loan amount, figuratively speaking, and kept my cash umolested, in part because I had a feeling that stocks, houses and assets were going to get real cheap in the not too distant future. And boy did they. I plowed money into the market when it lost half its value in a blink. Moral of the story, if you want to play you need cash. And when it comes to investing, you will never have as much of it as you would like.
Guard your cash, the Porsche mechanic near you has enough of it already.
06-26-2013, 03:24 AM
#72
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I'm 35... making about $240-$260k this year, decent money, but with $4500 rent living in San Francisco and California taxes, not much in reality and nothing like most of the people on this board... OH, and I still haven't purchased my first porsche. The idea of my money NOT growing for me makes me sick to my stomach. May buy the 991 gt3 I'm on list for in summer 2014 and keep it for 12 months.. but only if values stay VERY stable... and even then.. the idea of $150k just sitting there doing nothing but looking good for a year or so makes me more sick to my stomach.
to the OP... buy a Miata... enjoy the hell out of it.. enjoy your money making money for you with rental properties, stocks.. drugs... whatever floats your boat. Don't dump it into a nice car. You have your 40's-50's-60's-70's.. to do that.
or... ignore everything I've just said and smile for a bit while you enjoy your new toy... then keep working for the man until your back breaks and your children don't recognize you.
to the OP... buy a Miata... enjoy the hell out of it.. enjoy your money making money for you with rental properties, stocks.. drugs... whatever floats your boat. Don't dump it into a nice car. You have your 40's-50's-60's-70's.. to do that.
or... ignore everything I've just said and smile for a bit while you enjoy your new toy... then keep working for the man until your back breaks and your children don't recognize you.
06-26-2013, 03:24 AM
#73
Three Wheelin'
Holy guacamole, I'm not even sure how to respond to half of what you wrote. Speak to someone at your bank and ask them if you can speak with a financial planner -- someone who does not work off of a commission.
Are you putting anything into an eventual retirement (e.g., 401k)? What about an IRA? Bonds? Anything? Are you just stashing cash in a savings account?
I've read that the 30K mile maintenance typically costs around $2K. Replacing a failed water pump is going to cost another $1K+. What happens if this all occurs during your first year of ownership and then something else goes? What happens if you have unforeseen medical bills? Are you then completely out of cash?
I'm all for seizing the day...carpe diem...woohoo...whatever. I get it but don't be foolish about it. Part of growing up is learning that you can't always act like you're a 16y/o kid with the answers to everything. You can seize the day in a used Mazda Miata, too...and that Porsche you've dreamed about will always be waiting for you around the corner.
Best of luck,
-Eric
Are you putting anything into an eventual retirement (e.g., 401k)? What about an IRA? Bonds? Anything? Are you just stashing cash in a savings account?
I've read that the 30K mile maintenance typically costs around $2K. Replacing a failed water pump is going to cost another $1K+. What happens if this all occurs during your first year of ownership and then something else goes? What happens if you have unforeseen medical bills? Are you then completely out of cash?
I'm all for seizing the day...carpe diem...woohoo...whatever. I get it but don't be foolish about it. Part of growing up is learning that you can't always act like you're a 16y/o kid with the answers to everything. You can seize the day in a used Mazda Miata, too...and that Porsche you've dreamed about will always be waiting for you around the corner.
Best of luck,
-Eric
06-26-2013, 04:58 AM
#74
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^ I'm scared-- in a few years of holding off on a 996, I will need to start looking at 997s since many who buy 996s from now til a few years from today, owners will sell them since they couldn't afford to take care of their car, or even do basic/necessary maintenance and checkups-- meaning car is even more sketchy, meaning less confidence on my part.
I will go visit my bank tomorrow and ask about IRA, bonds, etcs
I will go visit my bank tomorrow and ask about IRA, bonds, etcs
