How can you afford the cost of a new SUV?

[Stbentoak]

I've seen it too many times of people that work and scrimp and save all their lives for retirement and are dead 2 years after they retire. Or people who have a big nest egg and then are "afraid" to touch it, because "it has to last"..... your kids will spend it in a New York Minute.... Trust me.
A great retirement isn't all about big numbers, a great retirement is about income that has long legs and won't fail you in 5 years or 15 years. This is the holy grail of a good retirement. I have structured my investments so that a check from multiple sources shows up every month and will for the long-term future. Investments that if structured properly, make up roughly 50-75% of your income annually. Pay an Advisor to run a long-term plan of your assets to age 90 based on your expenses, inflation, taxes, conservative returns, and how you want to live. Cold hard data and no emotions involved. Unless you are armed with factual data, you will over analyze every big expense, never knowing whether you can really afford it or not. Live debt free and eat the cake and don't save it for later. You never know when the other shoe will drop or you will lose a spouse, etc. Money is a cold bedfellow with no one to share it with.....

 

[mountie]

was that a express lane? usually that's all there is if you want to skip thru all the exit's
and some of them are free if you have multiple occupants and set the fast pass for 2 or more, it can depend on the time of day as well

A toll road..... south Orange County, to bypass the freeway for a bit.

 

[Geotrash]

I've seen it too many times of people that work and scrimp and save all their lives for retirement and are dead 2 years after they retire. Or people who have a big nest egg and then are "afraid" to touch it, because "it has to last"..... your kids will spend it in a New York Minute.... Trust me.
A great retirement isn't all about big numbers, a great retirement is about income that has long legs and won't fail you in 5 years or 15 years. This is the holy grail of a good retirement. I have structured my investments so that a check from multiple sources shows up every month and will for the long-term future. Investments that if structured properly, make up roughly 50-75% of your income annually. Pay an Advisor to run a long-term plan of your assets to age 90 based on your expenses, inflation, taxes, conservative returns, and how you want to live. Cold hard data and no emotions involved. Unless you are armed with factual data, you will over analyze every big expense, never knowing whether you can really afford it or not. Live debt free and eat the cake and don't save it for later. You never know when the other shoe will drop or you will lose a spouse, etc. Money is a cold bedfellow with no one to share it with.....

Yes. This is what we’ve done. Except you’re saying don’t save a big nest egg but have enough to pay you an income until you’re 90, so I’m a bit confused about that part. Income that will last 15-25 years is a pretty big number to start

 

[blackelky]

I really have no idea how people are doing it. I LOVE the Esky V but there's no way I could justify (let alone afford) spending $150k on a new whatever.

My wife and I do pretty well for ourselves (not as well as @Geotrash !!!) but its getting more difficult to maintain current lifestyle, let alone save, with 1 in college and another a year away. NJ isn't the cheapest place to live but the salaries are usually decent enough.

I'll keep my $50k (at the time) 17 Burb LS, base model, no options, and keep adding to it and/or upgrading it. It will be "new to me" for however long I can keep it.

Facts I can't wait too retire and leave NJ for a second time.

 

[steiny93]

Retirement is not an age, its a number. No one I know with money talks about retirement as an age.

What I've discovered, retirement isn't a number and it isn't an age, it's a state of mind.
15 years ago I was all about a number. Well that number has came and gone a couple times, now what?

Buddies of mine have retired early (40's), their lives are a mess and they are lost (highly driven people without direction cause chaos for themselves). Other friends of mine have found something to dive into and it works for them.

For me, the dollar problem is long solved, now it's a matter of figuring out what I'm going todo with my time.

 

[steiny93]

If you are young and making $400K like you are, you are spending like a drunken sailor if you need to work until 65 before retiring. I retired at 60 making 1/5 of that. But I can't justify a new Tahoe.

The issue is that if you make $1 or you make $1M the retirement needs are proportionally larger. By this I mean the percentages of saving needs stay the same as the retirement targets are proportionally larger.

Basically, it isn't any 'easier'; if anything it's more difficult as income limits hinder options for higher dollar earners.

 

[Geotrash]

What I've discovered, retirement isn't a number and it isn't an age, it's a state of mind.
15 years ago I was all about a number. Well that number has came and gone a couple times, now what?

Buddies of mine have retired early (40's), their lives are a mess and they are lost (highly driven people without direction cause chaos for themselves). Other friends of mine have found something to dive into and it works for them.

For me, the dollar problem is long solved, now it's a matter of figuring out what I'm going todo with my time.

I think it was Peter Drucker who observed that highly motivated people do better in their “retirement years” when they can engage in meaningful work, such as helping a non-profit, or doing occasional consulting projects on their own terms. That sounds like a future I’d love, too.

 

[vcode]

The issue is that if you make $1 or you make $1M the retirement needs are proportionally larger. By this I mean the percentages of saving needs stay the same as the retirement targets are proportionally larger.

Basically, it isn't any 'easier'; if anything it's more difficult as income limits hinder options for higher dollar earners.

Hunh? That's assuming if you make more you will spend more. The whole you need 80% of your income in retirement is BS if you are only living on half that much to begin with. I wish income limits were an issue. This sounds like what my old boss told me when I found out my salary was at 80% of the mid-point for my job. He said I should be happy as I was entitled to higher raises to get to my mid-point while others at their mid-point would get smaller raises. I just walked out of his office......

 

[steiny93]

Hunh? That's assuming if you make more you will spend more. The whole you need 80% of your income in retirement is BS if you are only living on half that much to begin with. I wish income limits were an issue. This sounds like what my old boss told me when I found out my salary was at 80% of the mid-point for my job. He said I should be happy as I was entitled to higher raises to get to my mid-point while others at their mid-point would get smaller raises. I just walked out of his office......

Absolutely "assuming if you make more you will spend more"
I'm assuming everyone is attempting to sustain an income proportionally similar (working to retirement).

Some folks might be in the camp where they are going to retire on 1/10th of their normal income, I haven't met any yet.

 

[Dburksmem]

What I've discovered, retirement isn't a number and it isn't an age, it's a state of mind.
15 years ago I was all about a number. Well that number has came and gone a couple times, now what?

Buddies of mine have retired early (40's), their lives are a mess and they are lost (highly driven people without direction cause chaos for themselves). Other friends of mine have found something to dive into and it works for them.

For me, the dollar problem is long solved, now it's a matter of figuring out what I'm going todo with my time.

I like that. I can agree to this in a sense. I am a highly driven person but I honestly wont miss the hustle and bustle, stress, and politics of corporate america. I am tired of playing that game. For me, when I hit my number or beyond, I will pursue the passions I have put on hold so that I could provide for my family. A job doesnt define my life and and I am sorry for the ones who cant figure out life after work. I have already started mapping out what post retirement looks like for me.

Great discussion here and hearing different point of views. As many stated before, there has to be balance and focusing on the finishline without enjoying the journey there might not be the best way to attack it. I too know people who died as soon as they retired and got their dream vehicle. Thats why I advise anyone to do the work early when it comes to retirement and being debt free so that you can enjoy the fruits of your labor on your journey to retirement rather than waiting until you retire.

 

[Saltydog]

What I've discovered, retirement isn't a number and it isn't an age, it's a state of mind.
15 years ago I was all about a number. Well that number has came and gone a couple times, now what?

Buddies of mine have retired early (40's), their lives are a mess and they are lost (highly driven people without direction cause chaos for themselves). Other friends of mine have found something to dive into and it works for them.

For me, the dollar problem is long solved, now it's a matter of figuring out what I'm going todo with my time.

I like this! I used to focus on a number, now I focus on what my passion/interest will be when I am done with my current Gov job. I need to have something driving me and the general thought of retirement with nothing to do gave me anxiety!

 

[Jocko PDX]

I would argue that it is best to enjoy every day. Do not wait until you retire to enjoy life. This does not mean that you don't save for retirement, but enjoy every day. Most folks will have less energy and be far more limited mobility wise when they are in mid 60's or older. At 53 I dont have the energy that I did at 45.. and my knees won't let me play as much tennis, or climb mountain or hike in to some remote places that I used to. But I have done thiose things when I was a bit younger.. So I do my best to squeeze all I can out of every day and year. Really no regrets right now.

 

[mrrairai]

That was a great reply. It paints a good picture of how frugality can pay-off in the long run. The act of writing $80k checks to keep up with the Jones's will keep a person hooked to the work cart FOREVER.

Why do so many people assume that folks buying these expensive SUVs is trying to keep up with the Joneses?

 

[Geotrash]

I would argue that it is best to enjoy every day. Do not wait until you retire to enjoy life. This does not mean that you don't save for retirement, but enjoy every day. Most folks will have less energy and be far more limited mobility wise when they are in mid 60's or older. At 53 I dont have the energy that I did at 45.. and my knees won't let me play as much tennis, or climb mountain or hike in to some remote places that I used to. But I have done thiose things when I was a bit younger.. So I do my best to squeeze all I can out of every day and year. Really no regrets right now.

This speaks to me. I spent my 20's, 30's and 40's traveling all over the world for work and spending like a drunken sailor on everything from expensive new cars to owning an airplane. Because of that, I'm playing a bit of catchup on my savings. Which is why I look back at some of the spending decisions I made with a critical eye. I don't regret a single cent I spent on experiences, but I do regret money I spent on expensive new vehicles when a used one would have still been more than adequate for my needs and overall experience.

 

[B-train]

Why do so many people assume that folks buying these expensive SUVs is trying to keep up with the Joneses?

Because that is AMERICAN culture to a T. If you need the latest clothes, shoes, TV subscriptions, computer, gaming console, etc because your friends or neighbors have it (directly or indirectly) you fall into that scenario. Basically.......if you can't live without feeling like less than others and buy stuff to impress yourself, or others, you fit the bill.

 

[89Suburban]

Because that is AMERICAN culture to a T. If you need the latest clothes, shoes, TV subscriptions, computer, gaming console, etc because your friends or neighbors have it (directly or indirectly) you fall into that scenario. Basically.......if you can't live without feeling like less than others and buy stuff to impress yourself, or others, you fit the bill.

Definitely not me. I could care less about the "Jonses" scenario. The only peer pressure I can't stand up to is the techy stuff in here with these damn trucks lol. Think I need to break free from this place LOL.

 

[mountie]

I like conveniences, options..... but mostly, I prefer simplistic. Heck, I still like my factory CD player.

 

[vcode]

Absolutely "assuming if you make more you will spend more"
I'm assuming everyone is attempting to sustain an income proportionally similar (working to retirement).

Some folks might be in the camp where they are going to retire on 1/10th of their normal income, I haven't met any yet.

Don't know any at 10%, but I am quite comfortable at around 40%. And I didn't make that much to begin with!

 

[mrrairai]

This speaks to me. I spent my 20's, 30's and 40's traveling all over the world for work and spending like a drunken sailor on everything from expensive new cars to owning an airplane. Because of that, I'm playing a bit of catchup on my savings. Which is why I look back at some of the spending decisions I made with a critical eye. I don't regret a single cent I spent on experiences, but I do regret money I spent on expensive new vehicles when a used one would have still been more than adequate for my needs and overall experience.

Hey I was a drunken Sailor!!! LOL

 

[EddieC]

I can't justify paying more for a vehicle than our house cost.
Deep pockets, short arms.