How do people manage their lifestyle goals in amongst getting IP early on?

[BayView]

This is exactly what I'm so confused about! Saving 30k for a car is a house deposit! Lol grrr. Guess it'll just slow down the IPs in the first instance

I've been through this mindset you are in - the "opportunity cost" of X...

You don't have to save $30k for the car - get a loan if you have to, and accept it as part of living..

Just don't spend $60k when you can spend $30k, or don't spend $30k when you might be able to only spend $20k etc.

Then, put the difference between the two likely car repayments towards your next IP..

Most folk don't do it this way; they spend the $60k on the car....

But you have a higher goal in mind.

You know what to do.

 

[timbom3]

If you are "running outreach clinic from hospitals" soon....
Are u a bonded Uni student?

I hesitate to say "med student" in case china is reading. If so then you usually get a gov car if u get posted out there. Out west they are usually 4WD.

Have fun and stop in at Mosman gorge. Breathtaking.

Will add it to the list! Yea, student, one of the crazy ones who wants to be in the bush! Once you're a boss you are given cars etc, but when a junior you're not I believe. Tbh though, I had forgotten about that

 

[timbom3]

I've been through this mindset you are in - the "opportunity cost" of X...

You don't have to save $30k for the car - get a loan if you have to, and accept it as part of living..

Just don't spend $60k when you can spend $30k, or don't spend $30k when you might be able to only spend $20k etc.

Then, put the difference between the two likely car repayments towards your next IP..

Most folk don't do it this way; they spend the $60k on the car....

But you have a higher goal in mind.

You know what to do.

Glad I'm not the only one. I'll have to sit down and calculate it all. Accepting it as a cost of living sounds like a plan. Definitely not interested in spending 60odd on a car!

Anyway, thanks for all the advice guys. I guess I really just wanted some thoughts for and against it all!

 

[investor2009]

The choice is easy. Which is more important? There's your answer. I still drive a 97 Landcruiser and would like a new car apart fron the huge costs that go with it. I do have a couple mil in real estate so that might tell you something about my priorities

 

[timbom3]

The choice is easy. Which is more important? There's your answer. I still drive a 97 Landcruiser and would like a new car apart fron the huge costs that go with it. I do have a couple mil in real estate so that might tell you something about my priorities

But once, you bought the landcruiser! That would be my plan. Buy once keep for 30 years

 

[BayView]

The choice is easy. Which is more important?

Ask an 18 year old with a couple of grand in the bank.

Different answer I reckon.

 

[Deltaberry]

Hi Guys,
Just wanting to ask a quick question --> not sure where else to ask. The fiance and I are looking at doing a reasonably sized trip up to Cairns/Cape York etc (4wd country) within the next 2 years. This though, will require a 4wd upgrade (the old thing I have now just won't cut it). I'm 26 now, am just finishing Uni and am hoping to get an IP towards the mid to end of next year to "get into the market".

I'm well aware that borrowing for a car is not so wise ("bad debt") but where do people draw the line? We have to live a bit when we're young, right? I'll have kids in 5 years lol! I have the opportunity to lease a 4wd through work, though I still feel like this is dead money. Would this be a better move? To be honest, my job in the next 5 years will likely mean I need a 4wd so at some point (not so much for work per se, but I will be working in rural and even remote areas at times) I need to get one. The question is when, and how. A good quality 4wd is a significant purchase, even as a second hand vehicle (>30 odd grand).

Im finding it really hard to negotiate a balance in my mind. Any advice would be great!

At 26 and just leaving uni, you're already behind on the 8-ball.

And you want to take on bad debt to go on a holiday.

 

[devank]

At 26 and just leaving uni, you're already behind on the 8-ball.

And you want to take on bad debt to go on a holiday.

I was 26 when I left uni
But... I had a white Toyota Camry which was almost as old as I was

 

[timbom3]

At 26 and just leaving uni, you're already behind on the 8-ball.

And you want to take on bad debt to go on a holiday.

No, I want to take on bad debt to buy a car for the next 30 years. Fortunately my idea of a holiday is possible with this car .

I wish I was younger than 26! Lol

 

[sanj]

Ultimately it all boils down to opportunity cost. What opportunity are you forgoing by buying a car for the next 30 years at this point in your life?

 

[timbom3]

Ultimately it all boils down to opportunity cost. What opportunity are you forgoing by buying a car for the next 30 years at this point in your life?

Hehe. Yea, I think I've been talked out of it already. I'm going to get the house first. Try and pick up a 10k quality 2nd hand at some point and try and pay cash for it.

Thanks for the sensible slap across the face

 

[tobe]

Hehe. Yea, I think I've been talked out of it already. I'm going to get the house first. Try and pick up a 10k quality 2nd hand at some point and try and pay cash for it.

Thanks for the sensible slap across the face

keep the cash for the home deposit, unless you arent planning on purchasing in short term. You can get a home loan while you have a car loan, but you cant get a home loan without a deposit.

 

[investor2009]

Yes. BUT. We bought it with cash. Second Hand. . Sounds to me you have your priorities already made. Even without paying ridiculous servicing fees to keep a warranty it's cost lots of time and money (that's doing all repairs myself) I now have a work car. That's free. I run the Cruiser every now n then only to my second job because work don't wabt me using their vehicle for my financial gain

But once, you bought the landcruiser! That would be my plan. Buy once keep for 30 years

 

[Ostraylia]

I think everyone has given you great advice on which way to go.

To me, it appears your mind is set on the 4WD anyway, so my suggestion to you if you go down that path is to consider a Suzuki Grand Vitara (2004+ model) for between $10k-$19k. Far better than spending $30+k while you're still at Uni/just starting your first full time job.

They are quite capable off road, especially if you actually know how to drive offroad. You can quite readily modify the ride height and suspension. They seem to be good for up to 200,000kms if you look after it and service it correctly.

This way you could keep most of your money for a house deposit and possibly use a small deposit with a small loan to purchase the vehicle. My estimate on a $10k loan would be approximately $50/wk over 5 years, but confirm that for yourself.

As for keeping a car for 30+years, I think this is mostly for enthusiasts and/or those that know how to service their own cars. Are you mechanically inclined?

Personally, I would follow the advice of the others.

 

[timbom3]

Yes. BUT. We bought it with cash. Second Hand. . Sounds to me you have your priorities already made. Even without paying ridiculous servicing fees to keep a warranty it's cost lots of time and money (that's doing all repairs myself) I now have a work car. That's free. I run the Cruiser every now n then only to my second job because work don't wabt me using their vehicle for my financial gain

Thanks for your thoughts. I have come to the cash conclusion in a post above I'm going to sit on it until I can buy it with cash.

"Hehe. Yea, I think I've been talked out of it already. I'm going to get the house first. Try and pick up a 10k quality 2nd hand at some point and try and pay cash for it."

 

[timbom3]

Just thanking everyone for their comments! Lots to consider and I'll have to draw out a long term plan. Property is the priority, I was just hoping I could squeeze this out amongst it early on as well. For now I'm going lay low and stick to what I have. My 1996 4wd ute still runs (I quite like working on it) so wil just gut and reinstall the suspension and save myself 20 grand

 

[HD_ACE]

Hehe. Yea, I think I've been talked out of it already. I'm going to get the house first. Try and pick up a 10k quality 2nd hand at some point and try and pay cash for it.

Thanks for the sensible slap across the face

The most important decisions you make are early on in your journey. They will affect you the most for the longest.

Wise choice asking for advice on here and questioning the best way. I went through the exact same thing heres how i went about it ...

I ticked up a 20k car with a personal loan on high ir when i was younger. Thought nothing of it except for the ' chick magnet' aspect. Thought about property, this loan seriously hampered my servicibility so sold it within a couple of years to get serious with property and my goals.

Now i do love 4x4ing and i drive an 86 landcruiser with 500k km. this thing will go where not alot of 4x4s could go. Cost me bugger all payed cash.

I have sacrificed alot. Now i am younger than yourself with a handful of investments over several countrys that are apart of my main goal.

I am currently debating this same thing to sell the cruiser and buy a modern 4x4. I am still in aqusition mode and a car loan will prevent me from getting further so i will probably just stick it out for a few more years and reasses.

It just comes down to your personal goals and aspirations and what you are willing to sacrifice.

Hope this helps and good luck.

Cheers

 

[natmarie73]

If it helps at all, my property portfolio is what has allowed me to fulfil a lot more lifestyle goals than I could have if I hadn't invested. Buy at the right time ie just before a boom and sell at the right time and you can buy your 4WD with cash outright and take a longer holiday than you planned and still have enough money left over to re-invest.

Cape York isn't going anywhere and you're only 26 - you have heaps of time.

 

[Singo]

It's delayed gratification, I drive a beaten up 2002 Honda Jazz, shop for specials, go to the Thai hairdresser for a $10 hair cut, get my fruit and veggies from the Chinese grocers, etc. None of this really bothers me and I manage to save nearly half of my net pay.

Some are not delayed gratifications, but sensible things. Certain shops are cheaper for fruit and veggies. And a Thai hairdresser may cut better than others. By buying the goods at the right places, one can save a lot. There is no point buying all from Woolies when one can buy the same (sometimes better) stuff for less at the same street.

 

[BayView]

No, I want to take on bad debt to buy a car for the next 30 years. Fortunately my idea of a holiday is possible with this car .

I wish I was younger than 26! Lol

Holding onto a car for 30 years is not practical.

Even bullet-proof Landcruisers etc have breakdowns and rear main seal leaks and so on.

Also, in the world of retail we now currently are in, every car manufacturer is stocking less, and less parts to try and make money.

What's going to happen is your 20 year old car is going to be hard to get parts for, and not at a day's notice. Anything older than that is going to be worse.

This is already happening with many makes and models. Local suppliers simply cannot stock millions of various parts for every make and model on the road. They would go broke.

Now, they are stocking the main stuff, and anything a bit less common for breakages and wear and tear...wait and wait, and maybe not available at all..

Anything a bit more exotic, not as common, and more than about 15 years old (my "yellow line" at the workshop is 1990 for everything, but some more popular cars it is 1995")...harder and harder to get parts for, and expensive.

We had to get a front passenger side rubber window seal for a 1995 Prado a few months ago...had to order it ex-Japan and will cost the customer $250 incl GST.

It took 6 weeks to get it.

Now i do love 4x4ing and i drive an 86 landcruiser with 500k km. this thing will go where not alot of 4x4s could go. Cost me bugger all payed cash.

Good luck with that.