Liquid Assets and Expensive Car Purchase

[Dr. Gonzo]

I am fully aware of the slippery slope I can be on to spending it all but I have always been good with my money and about living within means so I'm not really worried. The only debt I have is my mortgage, and yes I could pay if off but it would completely drain me. I would feel much more secure having this money in investments to make me money while paying my mortgage and being able to deduct the interest.

At this point, I think my plan will be to put at least $150k into investments, $50k in savings, and use the remaining $50k on a car and take a much needed vacation.

 

[Rct851]

I wouldnt ask you to divulge your income on the forum but "pretty good money" is a helluva range. I know people with your job title hat make 50k-150k.

 

[Dr. Gonzo]

First number is a 9 lol

 

[Pribilof]

You should be able to easily beat any reasonable auto interest rate. I'd say invest the $250k and finance whatever car you decide on.

This. Rates are CHEAP right now. Auto loans less than 2%. Home loans less than 4%.

Invest wisely. Don't pay off cheap debt. Pay off credit cards instead. You're 33. That $250k could be $1 MM when you retire.

Edit: I invest for a living. Could I "afford" a new Lambo? Sure. I have other priorities such as providing a home for my family, saving for retirement, saving for my kids' schooling and college, etc. I'll be 37 in a few weeks. Trust me, delayed gratification and investing / spending discipline is the single most important factor in future monetary success. And although I do have a few relatively big cars in my signature I didn't used a 0.9% loan to buy the GT500 (now paid off) and a 1.7% loan to fund the Porsche. No other debt other than my mortgage (3%).

 

[mc01svt]

Money is not a math game. If it was the above would work. Money is what do I want now game. Because it is those that loan the money will make bank and those that take the loans will lose money.

That's why the banks make 11 figures net every quarter.

Money is in fact a math game. Bad discipline and poor planning on part of the individual does not change the numbers.

Also, i dont think you know how banks work. They don't actually have the money on deposit. Money is created out of thin air electronically every time they make a loan.

When you have a license to print money its easy to make a profit on near zero interest rates.

 

[ViciousJay]

OP can I be honest, don't waste your time! If it floats, fly's or ****'s, tread lightly! None of the three are investments and at 33 I'd pay your house and start banking!

 

[Dr. Gonzo]

Fortunately, a car does neither of those (3) and I'm fully aware cars are never investments. This is going to be a toy to enjoy, nothing more. I want to be smart with this money but I also want to use some of it for enjoyment.

Also, as stated above, I wouldn't feel comfortable depleting all of my money to pay off my mortgage. I think that money would be better suited making me money, which will likely net more than I'd pay in mortgage interest over the lifetime of the loan.

 

[13COBRA]

Fortunately, a car does neither of those (3) and I'm fully aware cars are never investments. This is going to be a toy to enjoy, nothing more. I want to be smart with this money but I also want to use some of it for enjoyment.

Also, as stated above, I wouldn't feel comfortable depleting all of my money to pay off my mortgage. I think that money would be better suited making me money, which will likely net more than I'd pay in mortgage interest over the lifetime of the loan.

Here's a thought for you. Please don't answer these questions, just something think about.

How much longer do you have on your mortgage? How many months? How much is your monthly payment, excluding tax and insurance?

If you were to take the $250k and pay off your mortgage, it's not like you're going to miss the money...you just got it. It's not like you saved up years to come up with the money.

At that point, say your mortgage is $1500, you could take that $1,500 and invest it in your 401k or mutual funds on a monthly basis, OR put it towards a vehicle note.

 

[IronSnake]

Also, as stated above, I wouldn't feel comfortable depleting all of my money to pay off my mortgage. I think that money would be better suited making me money, which will likely net more than I'd pay in mortgage interest over the lifetime of the loan.

You wouldn't be depleting your money given you'd be saved of the interest and able to take the 1-3k dollars a month you spend on your home and put in the bank instead. Imagine having nothing but cell phone, insurance, utilities, and basics for bills. When people tell you to enjoy life they don't imagine you have the opportunity to live practically debt free. Makes sense to me to pay the 3% home loan off, finance a GT500/whatever for 1-2 percent.

If things go to shit, your home is paid for, your bills are few, you can drink beer on your porch and survive. If you don't have the money to pay for the car, then shit they can take it. But at least your home is safe. That to me is pure happiness. Not some car.

 

[Dr. Gonzo]

You guys definitely make a very valid point and it's something I will consider. It would be hard to to let go of all that money and lose my safety net and nest egg, but not having a mortgage at my young age would be pretty amazing.

 

[13COBRA]

You guys definitely make a very valid point and it's something I will consider. It would be hard to to let go of all that money and lose my safety net and nest egg, but not having a mortgage at my young age would be pretty amazing.

You're not losing it though, you never had it to begin with.

It's like you just woke up one morning and the bank told you they lost the note on your house, you're debt free.

 

[DaleM]

I see a bunch of people on here with expensive cars and I've often wonder if they buy them outright or finance them. If finance, how much money they put down? Reason I ask is come spring time I, myself, am buying an expensive car as a toy and the price range could be anywhere from $30k - $100k.

I'm 33, single, the only debt I have is my mortgage, and I have excellent credit. I make good money as a construction project manager, pay into my 401k, Roth IRA and savings account, and I live a pretty modest lifestyle; my daily driver is a 2004 Subaru, I hardly take vacations, etc.

The reason why my budget is so wide is because I am inheriting a large sum of money, north of $250k, from my grandmother’s estate and I’m not sure how much a reasonable amount is to use on a car purchase. The cars that constantly cross my mind are a built C6Z, ZR1, C7Z, 997TT, Gen 4/5 Viper.

There’s no way I’m going to spend all my inheritance on a toy (if I did I’d go buy a UGR Lambo), but after unexpectedly losing my father a couple years ago I’ve learned how precious and short life really is to not enjoy as much as possible so that’s why I’m buying a nice toy; I just don’t know how much to spend. Whatever I don’t use in going straight into investments and my savings account. Since I don’t really have any debt would it be wise to put down a large deposit on a more expensive car and make monthly payments on a low interest loan, or buy a lesser expensive car and own it outright?

To you guys who own expensive, enthusiast cars, how did you do it? This is not intended to be a bragging thread, I’m very quite humble, I’m just looking for some serious advise. If you’re more comfortable responding via PM, that’s fine.

Worked 32 years, gotz lots of money at the end by waiting to buy super expensive shit.

Spoiling my kids more than my older ones.

Suck it up now and if you live, but then nice shit.

shamalama ramalama ding dong

 

[ViciousJay]

Delete.

 

[ViciousJay]

Fortunately, a car does neither of those (3) and I'm fully aware cars are never investments. This is going to be a toy to enjoy, nothing more. I want to be smart with this money but I also want to use some of it for enjoyment.

Also, as stated above, I wouldn't feel comfortable depleting all of my money to pay off my mortgage. I think that money would be better suited making me money, which will likely net more than I'd pay in mortgage interest over the lifetime of the loan.

Pay the house off and then enjoy! We all get itches for fun toys but the toys only bring negative consequences and boredom later (Trust me, it's mentally as well financially).

 

[DaleM]

Pay the house off and then enjoy!

When you be SVTP you can pay for the house and still enjoy!

shamalama ramalama ding dong

 

[Gravik]

I wouuod invest majority of it.

Sent from my SM-G950U using Tapatalk

 

[limitedex]

Just because you HAVE money doesn't mean you need to blow it.

 

[Blk04L]

Yea, I would pay off the house and save money by not losing money via interest to the bank. Then take a note on a toy if you really wanted one

Blew my mind when I signed the mortgage and saw how much money would be going to interest if I never paid more than the minimum. Hell, it's around the amount of money you'll be inheriting. And my interest rate is low 4's and I stayed way below the max I could of spent on a home loan.

 

[Buckwheat 1]

Fortunately, a car does neither of those (3) and I'm fully aware cars are never investments. This is going to be a toy to enjoy, nothing more. I want to be smart with this money but I also want to use some of it for enjoyment.

Also, as stated above, I wouldn't feel comfortable depleting all of my money to pay off my mortgage. I think that money would be better suited making me money, which will likely net more than I'd pay in mortgage interest over the lifetime of the loan.

Paying off your house allows you to tell people to **** off when necessary without bad repercussions of not being able to meet your banks obligations.

 

[ON D BIT]

Money is in fact a math game. Bad discipline and poor planning on part of the individual does not change the numbers.

Also, i dont think you know how banks work. They don't actually have the money on deposit. Money is created out of thin air electronically every time they make a loan.

When you have a license to print money its easy to make a profit on near zero interest rates.

This money game makes the lender rich and the debtor poor!

Not because of math(if it was math the opposite would be true) but because of wants.