Lottery tickets? Bric-a-brac? Cell phones less than 2 years old? Cable? Other monthly subscriptions? How much are they saving in their 401k/IRA?
I helped my daughter with a bad vehicle situation
- Thread starter grampi
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You're nosy, I'm not even that nosy with my kids...
Well you know it's the internet, everyone is a keyboard warrior and financial genius. We're trying to figure out why they're poor and do a Dave Ramsey on them although I prefer Warren Buffet/Peter Lynch. Never listened/read Dave Ramsey. Warren is more straight forward with investing/saving. Here's the bit about the 300k haircut.
https://www.wsj.com/articles/warren-buffett-and-the-300-000-haircut-11598626805
https://www.inc.com/jeff-haden/warr...-success-few-people-are-willing-to-admit.html
I never had the choice of a car payment since my very first vehicle due to insurance being so high, the only way I would have ever been able to afford it would have been with help from parents. To this day I’ve not had a car payment and it’s worked out better in the long run. I am always trying to tell others not to buy what they can’t afford. Every single one of them end up in a vehicle that cost 3 to 4 times as much as mine then being upside down trading it in on another car they can’t afford. Exactly what the OPS kids are doing here. A car would be better for them in every aspect except for their convenience. Being they bought another SUV that needs its belt replaced in 30,000 miles I assume they will just be forced to trade this one in as well. There are so many dodge caravans out there that would have served them well for 1500 bucks and not having a payment.
Which to me means they obviously don’t have the money to be buying another used SUV. Let’s just go farther in the hole, very very slim chance it will last them until it’s paid off. Especially if they can’t afford to maintain it.
What’s done is done with the van and pilot. I will say though hope is not a plan. Someone needs to learn financial discipline. If she’s not saving money to fix the pilot she will be in the same spot in 30k miles. Assuming she puts somewhere around 10k on per year that’s 3 years. That time is going to fly by and I foresee the next 12 to 18 months being a lot harder with inflation.
Trust me I’ve been broke and poor and needing to spend money. Maybe a part time job for her or her significant other would help dig her out of this hole. I’ve refereed hockey for 10 years to pay for my kids activities, our vacations home and camping. I did this to help ease the burden on my paycheck.
As my grandfather use to tell me “son decisions have consequences!”
Just my $0.02
Just had this chat with my 20 year old 2 weeks ago when his Jeep wouldn’t start. $750 later he’s back on the road.
He wanted to sell it even after he fixed it. So I laid out the finances and estimated he’d loose at least $3-$4k on the transaction. Once I laid that out he thought driving his Jeep wouldn’t be so bad.
Just my $0.02
I do, it was just the straw that broke the camels back. My luck with that Durango would have had me dropping $7,000 on a new cam and lifters the next year.
Guess I'm lost on the help part? We've did plenty of a trip and daily drives with two boys in a Festivas, Aspires, Focus and others when we were broke. I'll bet a few bucks they'll be in the same situation if they don't approve their financial status. If you can barely afford the payment how can you afford repairs?? I've seen it plenty of times with plenty of individuals and families.
I had to re-read the OP again and yeah, I'm lost as well. He "advised" them to get rid of it and buy something is "help", I guess.
I think a good take away from this is that they need to learn that they will not always be able to trade their way out of mechanical issues. They'll end up so far upside down that there's no way out of the hole. What's done is done, they own a Pilot now and the time to get it together is at hand.
1. They will need to learn a way to make sacrifices to make ends meet while being able to save a little. This is a must, not a suggestion.
2. Everyone has the internet now, they need to watch YouTube videos if they need to and they can learn how to do basic maintenance themselves. (Saving them a little money) Cheap Walmart tools will work for basic maintenance.
3. This Honda should last a long time given proper maintenance (YouTube videos) and maybe they can save for the timing belt change which is 20,000 + miles away.
4. Stop neglecting something that will obviously put them in a bad financial situation with neglect.
I hope the best for them, but eventually they'll have to pull themselves out and get ahead, you can't do it for them. It's not the end of the world, but it's time to wake up and figure something out.
Good luck!
1. They will need to learn a way to make sacrifices to make ends meet while being able to save a little. This is a must, not a suggestion.
2. Everyone has the internet now, they need to watch YouTube videos if they need to and they can learn how to do basic maintenance themselves. (Saving them a little money) Cheap Walmart tools will work for basic maintenance.
3. This Honda should last a long time given proper maintenance (YouTube videos) and maybe they can save for the timing belt change which is 20,000 + miles away.
4. Stop neglecting something that will obviously put them in a bad financial situation with neglect.
I hope the best for them, but eventually they'll have to pull themselves out and get ahead, you can't do it for them. It's not the end of the world, but it's time to wake up and figure something out.
Good luck!
One point I contend with Dave Ramsey is his 10% car rule. 10% of your annual salary is the most you can pay for a car. So only if you make at least $150k annually can you buy a Nissan Versa brand new, base model. That seems excessive to me.
Also, I love my own bias confirmation. My old Toyota Previa Van 1991 still works great at 200k miles. It has a timing chain, no electric doors, and even a functional AC. I wish I could buy one new!
Also, I love my own bias confirmation. My old Toyota Previa Van 1991 still works great at 200k miles. It has a timing chain, no electric doors, and even a functional AC. I wish I could buy one new!
Like I said, I never listen to Dave Ramsey but the standard rule of thumb I think was that car expenses shouldn't exceed 10% of your salary on an annual basis so that basically means the total of your car payments on an annual basis shouldn't exceed 10% not that the purchase price shouldn't exceed 10%. Car payments probably refers to monthly payments, insurance and other expenses not exceeding 10% of salary in a given year. Otherwise that rule is way off, means that only people who made 650k a year should have bought the Mercedes I'm driving now brand new.
how about go put a few extra work hours each? that's how usually people get around when they need money. not borrowing more and paying more interest for longer. you can "have" something unless you're able to pay cash for it. period.
It’s page 6 and all I have to say is people think they just put gas in a car and maybe do an oil change every so often and a car will be trouble free. They forgot about air filters, tires, brakes, spark plugs, fluids that have to be replaced with mileage or time. I can just imagine what these used car dealers and private parties are selling these days for top dollar.
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Eh, mine “borrow” during major upsets (car repair, HVAC, etc) …
Will I ever get it back ? Don’t know and don’t care (but never told them that part) …
Will I ever get it back ? Don’t know and don’t care (but never told them that part) …
Oops, wrong accusation. It was THIS guy. He called it the 1/10 rule. It has over 1,100 comments.
https://www.financialsamurai.com/the-110th-rule-for-car-buying-everyone-must-follow/
A good start. Some folks are just in a tight situation. Here's hoping they get everything figured out, the Pilot lasts for 10+ years and their retirement is secure.
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Well there's lots of advice out there, some pursue FIRE and really cut expenses to the bone. That guy is more like Warren Buffet going on about the 300k haircut. But not realistic on how people spend. We're just shooting for average here, that would be way above average if you can pull it off.
My first daughter was 18 months when my 2nd daughter was born.....A 1969 Chevy C/10 was only set of wheels we had, One bench seat for me, My wife & 2 car seats both held in by the middle lap belt. Took 10 minutes to thread the seat belt though to 2 car seats, Cinch them down, Then anchor the kids in the seats.
While it was a inconvenience & uncomfortable for me & the wife literally being sandwiched between the doors & car seats....We made it work for about 2 years 'til I saved enough money to buy a 4 door sedan (1983 Chevy Caprice) which made our lives markedly easier.
We were far too young to be having kids, Much less 2 of them so close together & we had to pay the price for those decisions which goes far deeper than vehicles, We had to rent a run down shack in a bad part of town & ate Hamburger Helper & canned vegetables more than any human should. We didn't even have a phone & had to coast into work on fumes many a Friday.
I worked my behind off to pull us out of poverty working on cars after work 'til 3 or 4am, Sleep a couple hours & drive to my day job. I'd also scrap metal, Mow lawns, Dig ditches, Set fence posts, Set-up Deer Blinds & Feeders, Welding, Along with some heavy haul trucking even though I didn't have a CDL.....I could drive with some of the best.
The whole need vs want thing is skewed in my opinion, But at the same time I DO cater to my now grown daughters wants more than I should!
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