What do you mean by 'afford it'? Seriously..

Discussion in 'Budget Board' started by DreadpiratK, Aug 29, 2010.

  1. Nayan

    Nayan DIS Veteran

    Jan 19, 2010
    Same here. While we 'can' afford certain luxury items, we choose not to. When my DH and I got married, he inherited the house we live in now. The interest rate was high for the time and our number one priority was to pay that sucker off! So we both worked as many hours as we could, ate a lot of Ramen soup, had no a/c or furniture and put every penny into the payments. We paid it off in record time. By doing that, we were able to put money into savings, buy a little nicer used car and travel a little bit. I still budget and watch my pennies but I can be a little lenient and splurge if it's truly something worthwhile.
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  3. Handbag Lady

    Handbag Lady Disneyland Bride 2000

    Jun 15, 2005
    1: We don't touch our normal monthly budget at all.
    2: We don't touch the emergency funds
    3; We haven't stopped our planned savings for retirement
    4: We don't stop or reduce our tithes and offerings, in fact we increase them.

    I agree with you list except for number 4. We are an atheist and an agnostic. We do, however, give to our own favored charities so maybe I do agree with you for number 4 but just differently. :)

    Not only do we do the above, but we have a designated account that we put money into weekly from our paychecks that is just for vacations. We pay in cash (or have the cash to pay off a used credit card for the rebates/miles.) We budget the vacation based on how much we have or will have by the vacation time.

    This, to me, is affording a trip.
  4. Ava

    Ava DIS Veteran

    Mar 13, 2006
    Ditto this. I spent 6 weeks traveling around Europe after I graduated from college. We stayed in cheap hostels & ate a lot of cheese sandwiches, but I didn't mind because it was a once-in-a-lifetime opportunity to travel like that.

    Everyone values things differently also. Maybe some of those people COULD afford to spend more on their vacations, they just choose not to. My dad hates flying - even if he can afford to fly, he'd rather drive a long distance. Just his preference, nothing to do with money or lack thereof.
  5. Pigeon

    Pigeon DIS Veteran

    Jan 12, 2005
    We can afford it if we have the cash to pay for it, and it doesn't eat into our other savings. I'm not a budget every penny kind of person. We live below our means and have savings and retirement money taken out automatically.

    We do not go on vacation often, and most years we stay home. Vacations usually get balanced with the never ending list of non-essential, but much needed homeowner projects that typically eat up a lot of our discretionary spending. So, WDW has to compete with remodeling a bathroom, putting in new flooring, etc.

    We have to do WDW on school vacation weeks as dh is a teacher, and in my mind, going to Disney from the Northeast in the summer is no vacation at all. I want to go when it's freezing here. Plane tickets are through the roof those weeks and there's typically no deal to be had. So WDW costs a bundle, even doing it as cheaply as possible. It just doesn't happen very often.
  6. disneyofcourse

    disneyofcourse DIS Veteran

    Oct 2, 2006
    I often wonder why some people on the budget board are just so angry and snippy. Is it just stress over money? Annoyance over someone else spending $10 when you think every penny needs to be saved? Then you come on here and bicker? Seems like every thread I read has at least two or three people having an angry hoedown over someone else having a vacation, carrying a balance or buying a $200 pair of shoes instead of going budget and buying the $10 pair. Everyone's budget is different and folks need to understand that.Being "Budget" to someone could mean a really good deal on that $3000 Sofa they've been eying and saving $500 off it. Budget to some other person means not buying anything unless its 90% off.

    If people have the money they choose to afford things. I feel if I have no bills upcoming and I can pay of my credit card in full on the date it due. I can afford it, but of course sometimes I ask here to make sure it isn't that frivolous.

    BTW I don't consider a vacation being anything that isn't taking you away from work life and person things for at least three days. For me going on an already paid trip with family isn't a vacation. I usually need a true vacation after THAT "vacation".:rotfl:
  7. Magpie

    Magpie DIS Veteran

    Oct 27, 2007
    We use credit, but we always have a plan and a schedule for paying it off. And my husband is in the enviable position of working for the gov't - meaning we don't have to worry about him getting fired.

    For us "we can afford it" means we've put money aside for the kids education (we borrowed to get it started and now we're paying it off - it comes out better that way in terms of matching funds from the gov't). We've taken care of the house payments for this year. We can cover any medical crises the pets might come up with. We've got enough either put aside or coming in to be able to visit his mother for a couple weeks in the summer. And after everything else, if he suddenly kicks off, there'll still be enough with insurance for me to pay off all our debts and get my feet back under me. Yeah... that's actually how my guy thinks. He's been planning for his own demise since he was 20. :laughing:

    If after all that we've got a few thousand dollars "free" - then we can talk about a trip to Disney (or, this year, Universal Studios!).

    It works for us!
  8. palavra

    palavra DIS Veteran

    Jun 8, 2007
    I think being able to "afford" something has a lot to do with income. For some people, saving for a vacation is as easy as direct depositing a set amount into a vacation fund every month. For others, it might mean eating mac and cheese for a month or cutting down on eating out.

    We paid for our trip with cash, but it was a stretch. We had emergencies come up and other financial situations such as a pay cut to deal with. Still, we took our daughter to Disney last year for a "once in a decade" type of trip. While we could have waited and had less of a financial headache trying to save the money, our daughter will only be at that magical princess age for a while. She will have those memories for a lifetime, long after the bills are paid :)
  9. trickiwoo

    trickiwoo Talk Disney To Me!

    Jul 14, 2009
    Lucky enough for us, we are two young people out of college with jobs and no kids yet. Since we don't have a lot of expenses, we can take vacations to Disney World without having to cut back anywhere else. We know once we start a family this won't be the case... so we're taking advantage while we can!

    As for deciding if it was affordable, we added up the cost of a MYW package and calculated the date the full amount was due and figured out how many paychecks were between now and that date. It was doable with our current situation. In the back of our minds there were several what if scenarios- What if we loose our jobs? What if we total one of our cars and have to buy a new one? etc. And we determined that if something like that were to happen, we'd cancel our vacation before the 45 day mark and get our money back. We waited until our vacation was paid in full and the 45 day mark had passed before we bought airline tickets or anything like that... just in case!
  10. hsmamato2

    hsmamato2 <font color=magenta>Tink in Training-Good Girl,Bad

    Mar 28, 2005
    charging most things to our cashback card- pay it all monthly- no balance left- so I guess that translates into money we have available right now to pay for what we want-including vacations. (maybe that's why it took us 10 years in our home before we saved enough aside to renovate our kitchen:rotfl2:)
    If I have to make a 'payment' and get finance charges- I won't spend it.
  11. pattiteach

    pattiteach Mouseketeer

    May 31, 2004
    I love reading this board for great ideas on how to save. And like many posters said my family vacations were down at the jersey shore. We went to Disney twice. Here is where my conflict lies, a Disney vacation for me is thousands of dollars. I live in PA so I am not close. Inorder for me to do this type of vacation, I need to have budgeted the thousands of dollars. When did Disney become an annual or frequent place for everyone? If you live by there, that is a completely different story. For me it is like Avalon(down the jersey shore) I live close, can drive there, and have a place to stay. Now if you were coming from Florida, you would need to find a place to stay, get there etc... I don't know, if you have the money great, go for it! But if you don't save until you can and enjoy the places around where you live!!
  12. roadtripper

    roadtripper DIS Veteran

    Mar 10, 2001
    I am a saver and a budgeter, but in the early years of our marriage, when we had two small children and I was a SAHM, one of DH's friends was getting married in Bermuda. My knee jerk reaction was "We can't afford it." My mom, who is VERY frugal said "that's what credit cards are for--go!" We went for three nights and had a ball. Mom was right--and it didn't turn me into a plastic loving fiend. We didn't have the money, and paid it off in several months, but it was worth it.

    So "afford" is relative, as many posters have remarked. I would never charge clothing, electronics, etc if I couldn't pay for them, but memories are worth spending for, IMHO.
  13. friskykitten

    friskykitten Mouseketeer

    Feb 18, 2000
    As all the previous posts have summerized, "can we afford it?" is going to be different for everyone depending on the financial situation they may be in or have been in in the past.

    The one thing I can be sure of is that we definatley view being able to afford it differently now than two years ago. Just like some others on this board we have gone through a very difficult time with losing both of our jobs 1.75 years ago. We had to make some hard decisions in order to survive at that point, even though we had the "alloted" six months of emergency funds. Before that time we always felt we could afford the vacation because we had seven months of cash in the bank for emergencies and two very good paying jobs and credit cards to cover it.

    After the job lay-offs we had to downsize, sell off some of our property, and budget, budget, budget. That meant making several sacrifices that we have now learned to live with quite comfortably.

    Now we have two very good paying jobs again, I just gave up a second part-time job, and my DH is still working a second job. We are still living frugally, not because we have to but because we now choose to. With those choices and the way we are budgeting we are able to "afford it" again. But we eliminated that credit card debt that got us into trouble when we lost our jobs. We have also changed our views on what we can afford. For us, we will save up and only go when we can pay for a vacation with cash using our debit card. If we choose to eat mac-n-cheese instead of steak and lobster in order to make it more affordable then that is our choice. It just shows we are willing to make some sacrifices in order to reap the rewards later at WDW. And I will always look to others here for ideas on how to make extra cash for that vacation or other purchase we may hope to make in the future. It is all part of the fun to see how much we can save or earn using other's clever ideas.

    Long story short, now that we have learned a few very hard lessons, it will be cash or wait until we have the cash. If it is not paid for before we go, then we will not go.

    Hopefully, we will never experience two job losses at the same time ever again. Even 7 months of savings was not enough to get us through without making some major changes in our spending and choice of life style.
  14. sameyeyam

    sameyeyam <font color=royalblue>Cancer didn't take my life,

    Apr 20, 2006
    For me "affording it" means:

    1. We have no debt other than mortgage.
    2. Our mortgage debt is less than 10% of our take home pay.
    3. 15% of our gross income is going into retirement.
    4. We have at least 6 months of expenses in savings.
    5. We could easily pay our bills on 1 income, even though we have 2.
    6. We have well funded college accounts for the kids.
    6. After all of that, if we have enough money in savings to pay cash for "it" then we can "afford it".

    If I had credit card debt, consumer debt or car payments, well that's my definition of "not affording it".
  15. disfan07

    disfan07 DIS Veteran

    Mar 25, 2006
    Would putting next to those dates that we didnt pay for it...would that change anything?

    I love my younger cousin, but really, being attached to a 4 year old for 24+ hours makes me NEED a vacation...haha. Basically, I'm the babysitter.

    I consider those the same thing as when I took my best friend who was out here for 4 days to a nice hotel in Beverly Hills for the night. It was a "trip", not a vacation. Her entire 4 days out here would be considered a vacation. But that one night into beverly hills was a trip. Not a real vacation.

    And to the PP who said I was complaining...get off your high horse. I wasnt complaining about anything. Has it been a bummer that we have not been to WDW in 3 years after having gone every year since 2001...yes. Most people here problem understand that sentiment....goign to your favorite place ever year and all of sudden not knowing when you will be able to go again. But I wasnt complaining. I was EXPLAINING why we have not had the $5000 necessary to pay for a WDW vacation in the past 3 years. The OP asked what we mean by "afford it" and in our family that means vacations paid in cash and I was explaining some life curveballs that have been thrown our way (good and bad) that have kept us from being able to "afford it".

    Thank you to all the other posters who didn't attack me and who understand what I was talking about. I didnt even think of those trips causing a controversy...If I had thought of that, I would have explained it in my first post.
  16. DawnM

    DawnM Dawn

    Oct 4, 2005
    I wish our mortgage were less than 10% of our take home pay. We weren't of that mindset when we purchased this house. We moved from a very high COL to a lower COL area and comparitively....this house was "cheap." But looking back, we wish we had bought less.

    Now, question......is less than 10% on a 30 year note or a 15?

    We just refinanced last year to a 15 year note. At least more than 50% of our payment is now going into principle.


  17. punkin

    punkin <font color=purple>Went through pain just to look

    Nov 28, 2001
    Then I can't afford anything!
  18. Swimalie

    Swimalie DIS Veteran

    Sep 11, 2009
    Not living where we live, right Punkin! I wish mine was only 10% of our take home pay but when you live near DC, that just doesn't happen. But we did make sure we didn't buy "house poor" and put 35% down when we bought.
  19. dvcgirl

    dvcgirl DIS Veteran

    Nov 1, 2002
    We're a little weird/different in this category. We have no debt at all. We have no kids. And we have a nice double income that allows us to save 60% of our net income. We've been saving a minimum of 20% towards retirement for 20 years and that percentage has gone up as our incomes have gone up. We live very comfortably on the 80K that's left over.

    And so we set those strict parameters....save 60% for retirement. Then with the remaining 80K we sit down at the beginning of the year and lay out a plan for how to spend it. First come monthly bills (insurance, taxes, utilities and groceries). With the pile that's left we determine if we have any large discretionary expenditures (like a guitar for my husband or a computer for the house), then vacation spending for the year. And what's left is carved up into 12 pieces for monthly discretionary spending.

    Obviously, we're fortunate, and if we had mortgage debt, car debt and a couple of college funds to deal with....we'd never be able to do 60%. But we're motivated to *try* and retire early. Although, even with a nice portfolio, with the way the world looks these days and what may be coming, I'm not sure if that will happen or not.
  20. punkin

    punkin <font color=purple>Went through pain just to look

    Nov 28, 2001
    Yes, we put down a big down payment when we bought but definitely not enough to get us an under 10% payment.
  21. bettymae1121

    bettymae1121 sure. fine. whatever.

    Jan 5, 2010
    Same here, we put 20% down and the payment is 25% of our current take home pay, I thought we did pretty well at the time. Of course housing crashed so our equity was wiped out, but odds are well could sell the house for about what we owe on it, if we're upside down it isn't by much. If it wasn't for that down payment we'd be up a creek for sure!

    As for "afford it", well my goal is to be consumer debt free in the next three years, we've been trying to pay down our debt for the last 5 years with only limitted success (case in point, the month after we paid off my DH's truck it needed a $6k repair, so the truck payments now go to pay off the repair rather than as extra to our CC payments. DH also took a pay cut at work and I didn't get a raise last year). However, meanwhile we don't want to cut out everything in life, so we still have cable, we still eat out once a week. My brother got married out in AZ this spring so we addeda 4 night trip to DLR to the front end of that. In theory we can't "afford it" because we have consumer debt, but both DH and I have learned through life experiance that if you put things off for too long, you may never get the chance to enjoy it later one (his father and my mother both died relatively young). So while our goal is to eventually be debt fee, we are taking a bit longer to get there than we might otherwise do.

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