You have to save for a 3 thousand dollar vacation, right?

[Iowajes]

Regarding Cars. We don't finance cars, we buy them; we earmark money we put in savings for the next vehicle. Just because you get a low interest rate doesn't always mean you get a great deal.

We paid cash for our last new car (it wasn't available as a used model), but I don't think financing is always a bad idea. If you can put the cash into an investment account with a better return than your interest rate, it's a good deal. Right now though any guaranteed investment (like CDs or a money market account) is so low, it doesn't make sense to do it this way.

My car is 12 years old, so in the next couple years I'm going to have to start thinking about maybe getting a new one.


We can go on a $3000 vacation with little "savings" because we are extremely frugal in everyday life (see: 12 year old car). We don't have cable, I haven't been to a coffee shop in years, I don't smoke, we eat out about twice a month, we go to the movies less than once a year, I get my hair cut every 2 years, I don't wear designer clothes or get manicures and pedicures.. Basically, everything we do is saving- it is the way our budget is set up. Sometimes (like this summer when we spent a few months learning to scuba dive) we spend a lot and nothing goes into savings, so then we are more conscious about it for the next few months. We certainly can't take a $3000 vacation all the time, but if we want to, because of how we live our lifestyle without excessive spending, we generally can if we want to.

 

[barbarabini]

Can't say I have ever inherited anything but a headache from dead relatives.

But if I want to go on a three thousand dollar unbudgeted trip, I would quickly sit down with a pen and paper and start to slash my expenses to try make it happen while trying to pick up a little more work.

See, I am of the "lets try to do without" the little things, the dinners out, the coffees, I make the lunches ect.. so that we can have a good vacation. My family is to big and my budget too small to afford everything. There always seems to be a trade off..

As for waiting for relatives to die, I tell my in-laws and parents to have a good time and spend it while their alive. Don't save it for us... we will make our own way.

 

[crisi]

We paid cash for our last new car (it wasn't available as a used model), but I don't think financing is always a bad idea. If you can put the cash into an investment account with a better return than your interest rate, it's a good deal. Right now though any guaranteed investment (like CDs or a money market account) is so low, it doesn't make sense to do it this way.

My car is 12 years old, so in the next couple years I'm going to have to start thinking about maybe getting a new one.

Leverage is under appreciated on these boards, and probably rightly so. If you understand it (like you do) you can use it to your advantage. But a lot of people don't have the discipline to do it.

Car loans are a great place to do it. Car interest rates are usually so low that you are almost always better off taking the money you would have used to pay cash and putting it into some investment vehicle - but with interest rates so low on CDs and Treasury, you have to be able not only to afford the car, but to afford the risk. Mortgages are even better because the government gives you the tax write off in addition to the low interest rates.

But you have to be able to afford the car, it isn't leverage if you aren't investing that cash, and you need to be able to afford the risk, and you need to have the discipline to manage the liquid asset ratio vs. debt for everything you leverage. If these three things aren't you, you are better off paying cash.

My house is currently mortgaged, and the money to pay off the house is sitting in the stock market. This year, with the stock market doing very well, that's a good deal - when the stock market crashes, I may regret that - but over the long term, I'm betting I come out ahead. To reduce my risk, I do overpay my loan and I do keep a significant amount of money available in cash as well to be able to pay the mortgage if the market drops and we go though a period of unemployment.

 

[hsmamato2]

Hey all,

From here in Indy depart on Sunday return on Friday it was 4k for Poly and 3k for Pop. That had Flight and 4 park days in it.

Our yearly household is just north of six figures. We have a mortgage, two car payments, Camper payment and storage(less than 200 a month) and all the other phones/cable/inet junk bills everyone else does.

People with these stats have to live on budgets, right?

Well now, I can address 3 things I do differently,that makes my budget very different from yours,if that is your question...(do people have to save?)
1) You are planning a 'last minute' trip,based on your randomly chosen dates- When planning our Distrips,we ALWAYS plan far ahead,and base our travel dates 100% on what discounts are being offered,and when. (last year,I planned a 10 day trip,4 'adults' food included,airfare,2 nites onsite at Universal,8 nites onsite at Disney,and spent a grand total of 2600.00-my bro decided to join us 'last minute',and spent at least that much for 2 adults,6 nites onsite...)
2) you stated 2 car payments,mortgage, a camper (10k) plus cable/phonesetc 'like everyone else'... not everyone else has those extras you currently have. We don't own a camper(tho I'd love to)we don't have 2 car payments(just won't) no cable,no home phone,etc etc. So saving for a vacation,for us,is all those things we choose NOT to have on a daily basis.
3) Yes indeed,we live on an everyday budget with a goal in mind. (We choose not to have certain things for a reason) So one of my goals is to vacation regularly,I value experiences over things tremendously. Yes,we save- and yes, we save for vacations with every $$ choice we make,every day.
I couldn't spend 3k on a 'last minute' planned disney trip for us, we don't have that kind of money. But putting aside a specific amount weekly,and planning along the way? heck yeah...we do have to save to get anywhere, but it's 2nd nature to us,it's what we do!
(Not in a 'deny ourselves everyday pleasures' way either,I truly don't miss cable tv, or eating out a lot,etc etc. Life is good!)
This isn't 'preachy' I would hope...just trying to form an answer to the OP thoughts....

 

[dawnball]

Car loans are a great place to do it. Car interest rates are usually so low that you are almost always better off taking the money you would have used to pay cash and putting it into some investment vehicle - but with interest rates so low on CDs and Treasury, you have to be able not only to afford the car, but to afford the risk. Mortgages are even better because the government gives you the tax write off in addition to the low interest rates.

Yes, that's another place that small things can add up. We had a 0% car loan, invested the cash. We invested the extra we would have paid on our mortgage, because the rates were so low, too. Especially with inflation lowering the real cost of a mortgage, it didn't make sense to pay in advance.

Really, having your money work for you doesn't require a large amount of money. It requires a large amount of discipline, a certain amount of thinking outside the box and a lot of self-analysis. We've learned a massive amount over the years that I don't think we would have learned if we started with a bigger nest egg.

 

[DWGal210]

The OP's question was "you have to save for a $3,000 vacation, right?" and then went on to assume that everyone has 2 car payments, a camper payment, storage fees, cellphone/cable/internet, and junk bills.

I was pointing out that yes, most people (including me) save for a vacation and not everyone has all the bills she does. We have those things because we've saved for them. It's about choices. The OP wanted a camper so she bought one on credit, rather than saving the money until she could pay with cash. There's nothing wrong with that, but its a choice she made that eats into her cash flow. She's now bemoaning the fact that she doesn't have money for a vacation she wants to take and is waiting for a relative to die so she can inherit money to make her life easier.

I'm sorry you were taking what I wrote as preachy, but that wasn't my intent. I was trying to point out that if you add up eating out, movies, getting coffee/lunch out every day, have smart phones, premium cable channels, etc. you're spending a good amount that could be saved, if you choose to do it. There's nothing wrong with spending money that way if that's what you want to do, we just don't so we can save it for other things - - like vacations.

If you want to compare to when we were younger, no we didn't have 7 cars or a vacation home, but we also still didn't have 2 car payments, a camper payment, storage fees and "junk bills."

100% agree.

One of my pet peeves (it's a long list ) is when people complain about not having enough money for extras and fun stuff, when they've chosen other areas where they spend their discretionary income. As the poster said above, whatever you want to spend your money on is fine; we all have different priorities. I personally live in a smaller home than the bank told me I could afford because I want to take vacations, go out to eat once a week, go to the movie theater a few times a month, etc. Those are my priorities. If people have others, that is absolutely fine, but then don't get upset when there isn't extra money in the budget for other fun/non essential items.

I once worked with a woman who would carry on all the time about how they didn't have money, we don't get to do anything fun, etc. I never bragged or talked about upcoming trips but when she would ask if I had any vacations coming up I wouldn't lie to her. She once said something to me like, "must be nice to be able to go on vacation." I then walked into the break room a few days later and heard her telling another co-worker that she and her husband would go to Wal-Mart every week and buy all the new release DVDs. So you're whining about not going on vacation, but you spend at least $100/week on DVDs?? There is your vacation money!! Ugh.

 

[crisi]

100% agree.

One of my pet peeves (it's a long list ) is when people complain about not having enough money for extras and fun stuff, when they've chosen other areas where they spend their discretionary income.

Mine (and its also a long list) is when people spend your money for you. "You make a lot of money, you should get a cabin." I don't want a second home, I don't want the work of a second home and we don't even like "wilderness" I don't know what we'd do with a cabin! Often how they want you to spend your money benefits them (they are picturing themselves borrowing a cabin).

My mother and brother in law have been famous for this. My brother in law passed on, but I remember a conversation about how my husband should go with him and my mother in law to Europe - since they were poor as church mice, this meant my husband should pay for the three of them to go to Europe. My brother in law had been to Europe three times in ten years, my mother in law four. I hadn't been in 25 years, my children had never been, and my husband hadn't been since he was a toddler. I lost it. (And booked a trip for our family to Europe).

But it happens with other things, too. You guys make a lot of money, I don't understand why you don't redo your kitchen (because it isn't a priority for us). I don't understand why you don't have Twins season tickets (we did at one time, we are too busy to go to the games). If I made as much money as you, I'd hire a housekeeper/carry a nice purse/go out to dinner more often. (I clean my own house adequately, I have a nice purse, I like this one at the moment, and we go to dinner plenty, thanks). The big one of course is people donating our money to charity for us "you guys should really support breast cancer research, NPR, the Red Cross..." I give money to charity, which ones and how much really isn't your business.

There is a relationship between what we don't do and what we choose to and can afford to do. We can't buy a lot of movies on DVD AND travel. We can't save for college for the kids and give money to ever charity that we "should" support.

 

[Gumbo4x4]

Oh boy, my MIL is the same. Why don't you spend your money on X instead of Y???

Because Y matters to us and X does not. My inlaws have never taken a vacation. Not one. And yes, they can afford it (even without making sacrifices). We don't question their priorities (to their faces anyway ), so we'd appreciate the same from her (FIL gets it).

 

[bettymae1121]

I'm similar to the OP in a lot of ways, right down to the low six figure income and an anticipated inheritance. The only thing expecting an inheritance has changed for me is that I'm not worried about saving for DD's college (17 years down the road). Worst-case, the inheritance doesn't materialize and I cash-flow DD's college as best I can and she takes out loans for the rest. Although the inheritance is a pretty sure thing for various reasons, it's still not something I want to bet my own future retirement on either.

Other than college funding, DH and I plan and save as if that money will never happen. We're on track to have $2M for retirement on top of DH's pension and SS, which should be plenty as we'll have a paid off home by then as well.

We have 3 vehicles, 2 of which we own outright and have 3 years left on the 3rd. This should be our last car payment, from here on out we should be able to pay cash for newer used cars. No camper, though!

We also don't have cable, internet is free (my employer pays it) and we don't have a home phone. Our phone service is $100 for two smart phones, a bit of a splurge but we hardly ever go out to movies/plays/concerts and I limit myself to one e-book purchase a month (I adore books so that's some self restraint right there, let me tell you) so it all balances out. I make my coffee at home, Starbucks is a one or two time per YEAR treat. We do budget a fair amount for eating out but we consider that part of our "entertainment" spending, we also frequent more expensive restaurants as well.

But we aren't in a perfect situation. In 2005 we put 20% down on a $186k "fixer" that is now worth $120k (if we're lucky) and it still needs about $10k worth of work (after sinking in tens of thousands already). We'll NEVER get that investment back, at this point we just want to make the home enjoyable and hope to one day sell it for what we owe on it plus closing costs. Still, the mortgage/taxes/insurance is less than 25% of our take home so at least it's affordable.

Our biggest "splurge" of all is groceries. I'm very much into the natural/organic "thing" and spend a small fortune on pasture raised meats, eggs, and dairy and organic produce and staples. I do save where I can, making all of our baked goods from scratch and cooking from scratch in general as much as possible, but it is an expensive way to eat. I credit it for getting my DH all but off his insulin (he's type 2 diabetic and has been on insulin for years until we got hard-core on this way of eating about six months ago), though of course additional long-term health benefits remain to be seen. To me this is a cross between a need and want, we need to eat and eating healthy is certainly important, but in theory we could spend half what we do on food if we ate a more conventional American diet.

So, could we drop $3k on a spur-of-the-moment trip? In theory, yes - but we'd have to postpone some other goals to do so, namely replacing our roof sometime in 2014. Once the big ticket times on the house are behind us (new roof in 2014 and a new kitchen in 2016 most likely) then $3k on an annual vacation is no problem at all. It's only $250 a month if you think about it, or $125 a month if you want to take a big vacation every other year.

 

[Colleen27]

But it happens with other things, too. You guys make a lot of money, I don't understand why you don't redo your kitchen (because it isn't a priority for us). I don't understand why you don't have Twins season tickets (we did at one time, we are too busy to go to the games). If I made as much money as you, I'd hire a housekeeper/carry a nice purse/go out to dinner more often. (I clean my own house adequately, I have a nice purse, I like this one at the moment, and we go to dinner plenty, thanks).

That gets me too. My inlaws have a magazine-perfect home and my MIL just doesn't understand why we spend thousands on travel and concerts and ballgames and museum memberships and things like that while "neglecting" (keeping up but not updating) our home. We do a couple of projects every year - the house is 135 years old and we're fixing it up room by room - but at this point it just isn't our highest priority. The kids will only be young for so long and there are a lot of places we want to experience as a family. My outdated but functional kitchen, on the other hand, isn't going anywhere.

 

[patsal]

It is all about priorities. Don't assume everyone has the same bills you do.

 

[pk1023]

Okay, can this thread mercifully end please?

I was having a bad day in a bad week. I was studying for a test in my MBA program last night (I PASSED, 85% on final, B in class!) and that had me on the ropes.

I'm a VERY LUCKY person. I have had man advantages that others would die for. My mom is... a well she's a lot to take! But, she's the American dream. Her dad dropped dead of smoking/drinking when she was 21 and left 5 more children that mom helped raise. She did that, she raised me with all the benefits her education could provide and I am grateful.

I get it, that I'm blessed. Now lets just end it there, no?

Finally, my camper is 100 times better than Disney any day of the week. If they closed it completely tomorrow, I wouldn't care. But, to never be able to enjoy the natural beauty of this world again? Unacceptable!

 

[pocomom]

thought it was ending, last post was yesterday until you just posted

 

[Gumbo4x4]

Finally, my camper is 100 times better than Disney any day of the week. If they closed it completely tomorrow, I wouldn't care. But, to never be able to enjoy the natural beauty of this world again? Unacceptable!

How frequently do you use your camper? You can rent a decent trailer for about $250 a weekend IIRC. You're paying $2,400 a year just to park yours all while taking depreciation, paying for upkeep, insurance, and possibly monthly finance charges. Is ownership really the way to go? Honest question.

 

[smidgy]

Finally, my camper is 100 times better than Disney any day of the week. If they closed it completely tomorrow, I wouldn't care. But, to never be able to enjoy the natural beauty of this world again? Unacceptable!

dif. people like dif. things. one is not better than the other.

but if you love your camper and want to go to Disney, as has been suggested previously: why don't you take your camper to Disney world and stay at Ft. Wilderness? It really is very pretty, lots of trees, on the lake. you would love it.(and you do get all the benefits of stayingn onsite (Extra magic hours, etc) they have pools, horseback riding, a great buffet with great fried chicken, a boat ride away from magic kingdom. oh and chip and dales campout sing a long and a mickey's outdoor somethign or other. check it out.

 

[Here4mydisneyfix]

What exactly are "man advantages that others would die for"? I just HAD to ask.

 

[mistysue]

What exactly are "man advantages that others would die for"? I just HAD to ask.

That was probably supposed to say many.

 

[Here4mydisneyfix]

That was probably supposed to say many.

Oh my, you are probably right! We are all sick over here and the fever has eroded my brain I think! That didn't even dawn on me!! lmao! You have to admit it sounds WAY funnier when worded "man advantages" tho! teeheehee!