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Saturday, November 24, 2007

New cars

My mom wants to buy a new car. A mini-cooper convertible. From now on, I will bite my tongue every time she talks about it, as I will when she ultimately (probably) buys it. She does not tell me what to do with my money, and it is certainly not my place to tell her what to do with hers. I've heard she says she has plenty saved for retirement (but how much is plenty?) so if she really can afford a new car, then good for her.

My older sister encourages me to buy a new car every so often. I graduated about a year and a half ago, and it seems to be the thing to do. "You can afford the payments. You are a single person making plenty of money." This is true, I can. Still, I don't yet feel financially secure enough to spend that kind of money, and I don't want to finance it. Not yet, at least. It isn't as though I'm sitting on a bunch of money. My net worth is only just creeping up to 10k (and creeping so slowly with the volatile market!), and purchasing a car would plummet it down into negative numbers. Besides, my car works just fine, and it should work just fine for several more years if I want it to.

Maybe I'm more cautious than she is, but she is also married to a very nice young man whose grandparents happen to have set aside a pile of money sitting in investments for their use. It isn't that they are wasteful of that money, but I think having a giant fund to fall back on gives you a little more confidence in purchasing. Maybe once I have some sort of fund to fall back on, I'd feel more comfortable in purchasing a newer car.

2 comments:

Anonymous said...

A car is an asset; this is why banks will lend you money to buy a car but not groceries. Thus, purchasing a car would not send your net worth to negative numbers--the debt would be offset (partially) by the value of the car.

Of course, a car is a depreciating asset, and the largest single depreciation occurs when you drive a brand new car off the lot. Buying a used car with 3 years left on the original warranty would not be a bad decision if you wanted/needed to buy a car.

Doesn't mean you should buy a car; just that you should think about net worth calculations correctly--liabilities (debt) offset by assets, real and financial.

SJean said...

I think it is up to each person to decide how to calculate net worth. I could not get by without a car, I couldn't sell the car and get cash out of it.

They would give me loans for furniture as well, but I don't count those as assets.

Yes, it is an asset, but when I calculate how I'm doing with my goals, I don't like to count purchases like that.

Saturday, November 24, 2007

New cars

My mom wants to buy a new car. A mini-cooper convertible. From now on, I will bite my tongue every time she talks about it, as I will when she ultimately (probably) buys it. She does not tell me what to do with my money, and it is certainly not my place to tell her what to do with hers. I've heard she says she has plenty saved for retirement (but how much is plenty?) so if she really can afford a new car, then good for her.

My older sister encourages me to buy a new car every so often. I graduated about a year and a half ago, and it seems to be the thing to do. "You can afford the payments. You are a single person making plenty of money." This is true, I can. Still, I don't yet feel financially secure enough to spend that kind of money, and I don't want to finance it. Not yet, at least. It isn't as though I'm sitting on a bunch of money. My net worth is only just creeping up to 10k (and creeping so slowly with the volatile market!), and purchasing a car would plummet it down into negative numbers. Besides, my car works just fine, and it should work just fine for several more years if I want it to.

Maybe I'm more cautious than she is, but she is also married to a very nice young man whose grandparents happen to have set aside a pile of money sitting in investments for their use. It isn't that they are wasteful of that money, but I think having a giant fund to fall back on gives you a little more confidence in purchasing. Maybe once I have some sort of fund to fall back on, I'd feel more comfortable in purchasing a newer car.

2 comments:

Anonymous said...

A car is an asset; this is why banks will lend you money to buy a car but not groceries. Thus, purchasing a car would not send your net worth to negative numbers--the debt would be offset (partially) by the value of the car.

Of course, a car is a depreciating asset, and the largest single depreciation occurs when you drive a brand new car off the lot. Buying a used car with 3 years left on the original warranty would not be a bad decision if you wanted/needed to buy a car.

Doesn't mean you should buy a car; just that you should think about net worth calculations correctly--liabilities (debt) offset by assets, real and financial.

SJean said...

I think it is up to each person to decide how to calculate net worth. I could not get by without a car, I couldn't sell the car and get cash out of it.

They would give me loans for furniture as well, but I don't count those as assets.

Yes, it is an asset, but when I calculate how I'm doing with my goals, I don't like to count purchases like that.

Saturday, November 24, 2007

New cars

My mom wants to buy a new car. A mini-cooper convertible. From now on, I will bite my tongue every time she talks about it, as I will when she ultimately (probably) buys it. She does not tell me what to do with my money, and it is certainly not my place to tell her what to do with hers. I've heard she says she has plenty saved for retirement (but how much is plenty?) so if she really can afford a new car, then good for her.

My older sister encourages me to buy a new car every so often. I graduated about a year and a half ago, and it seems to be the thing to do. "You can afford the payments. You are a single person making plenty of money." This is true, I can. Still, I don't yet feel financially secure enough to spend that kind of money, and I don't want to finance it. Not yet, at least. It isn't as though I'm sitting on a bunch of money. My net worth is only just creeping up to 10k (and creeping so slowly with the volatile market!), and purchasing a car would plummet it down into negative numbers. Besides, my car works just fine, and it should work just fine for several more years if I want it to.

Maybe I'm more cautious than she is, but she is also married to a very nice young man whose grandparents happen to have set aside a pile of money sitting in investments for their use. It isn't that they are wasteful of that money, but I think having a giant fund to fall back on gives you a little more confidence in purchasing. Maybe once I have some sort of fund to fall back on, I'd feel more comfortable in purchasing a newer car.

2 comments:

Anonymous said...

A car is an asset; this is why banks will lend you money to buy a car but not groceries. Thus, purchasing a car would not send your net worth to negative numbers--the debt would be offset (partially) by the value of the car.

Of course, a car is a depreciating asset, and the largest single depreciation occurs when you drive a brand new car off the lot. Buying a used car with 3 years left on the original warranty would not be a bad decision if you wanted/needed to buy a car.

Doesn't mean you should buy a car; just that you should think about net worth calculations correctly--liabilities (debt) offset by assets, real and financial.

SJean said...

I think it is up to each person to decide how to calculate net worth. I could not get by without a car, I couldn't sell the car and get cash out of it.

They would give me loans for furniture as well, but I don't count those as assets.

Yes, it is an asset, but when I calculate how I'm doing with my goals, I don't like to count purchases like that.

Saturday, November 24, 2007

New cars

My mom wants to buy a new car. A mini-cooper convertible. From now on, I will bite my tongue every time she talks about it, as I will when she ultimately (probably) buys it. She does not tell me what to do with my money, and it is certainly not my place to tell her what to do with hers. I've heard she says she has plenty saved for retirement (but how much is plenty?) so if she really can afford a new car, then good for her.

My older sister encourages me to buy a new car every so often. I graduated about a year and a half ago, and it seems to be the thing to do. "You can afford the payments. You are a single person making plenty of money." This is true, I can. Still, I don't yet feel financially secure enough to spend that kind of money, and I don't want to finance it. Not yet, at least. It isn't as though I'm sitting on a bunch of money. My net worth is only just creeping up to 10k (and creeping so slowly with the volatile market!), and purchasing a car would plummet it down into negative numbers. Besides, my car works just fine, and it should work just fine for several more years if I want it to.

Maybe I'm more cautious than she is, but she is also married to a very nice young man whose grandparents happen to have set aside a pile of money sitting in investments for their use. It isn't that they are wasteful of that money, but I think having a giant fund to fall back on gives you a little more confidence in purchasing. Maybe once I have some sort of fund to fall back on, I'd feel more comfortable in purchasing a newer car.

2 comments:

Anonymous said...

A car is an asset; this is why banks will lend you money to buy a car but not groceries. Thus, purchasing a car would not send your net worth to negative numbers--the debt would be offset (partially) by the value of the car.

Of course, a car is a depreciating asset, and the largest single depreciation occurs when you drive a brand new car off the lot. Buying a used car with 3 years left on the original warranty would not be a bad decision if you wanted/needed to buy a car.

Doesn't mean you should buy a car; just that you should think about net worth calculations correctly--liabilities (debt) offset by assets, real and financial.


SJean said...

I think it is up to each person to decide how to calculate net worth. I could not get by without a car, I couldn't sell the car and get cash out of it.

They would give me loans for furniture as well, but I don't count those as assets.

Yes, it is an asset, but when I calculate how I'm doing with my goals, I don't like to count purchases like that.