You Never Have Money Once You Buy A House And A Car- True Or False?
I was always told this. But I was employed for 15 years travelling everywhere and if I didn't have a car I wouldn't have been on 30k a year! Owning a house is great fun but when it starts to become a drain to your cash flow with constant repairs and inflating mortgage prices, is it easier to say sod it and rent. (I sold up for this reason and started renting but I contradict myself because would love to buy again)
So do you ever have any money when you have a car and a house ?
By the way my husbands a mechanic but even so, he couldn't fix the repairs on our newish car that have come to £750 !- Reason for post by the way!
Well, all depends on how much income you have and how much you spend on housing and cars obviously. To always have money, the best rule is to spend the third of your income on housing, another third on everything else (food/clothes/car/repairs/travel) and put the last third on your savings account (invested in a mutual fund for example). It is actually not that difficult, if you have low income you can rent a small flat, commute by bike, etc for a couple of years and as your income grows (and it'll grow, cause your savings are growing each month and the interest you gain on it will slowly increase your income) you can slowly afford more and more. If your income is relatively higher and/or you want to go even further, check out the blog of Mr Money Mustache, he recommends saving the 50% of your income (and he does 90%)...
That's great...will check out that blog. In principle i agree but when things get in the way like elderly parents needing care, redundancy, and inflation, it's hard to predict how much you need to live on in say 5 years time. I prefer being self employed I can work around elderly relatives and keep an eye on growing trends in the self employment world! But renting is easier self employed because you are not fixed. The car however makes like easier gets my husband to work and me to my business meetings. I think sometimes what counts as necessesity is relative to different cultures and social groups.
Great picture. Now I follow you.
agreed! nice little allusion to Mary's room although I'm not too sure if it is a reference to that.
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For most ordinary people who have a median salary in Hong Kong can't even affort a flat there :'(. So to buy or not to buy a flat has become a social problem now...
I think sometimes people think it's a failure if you don't buy but I the amount you pay back is mindblowing! If I had the money I would buy outright.
Our house is 1180 SF. Smallish. But cozy. Our cars are a Hyundai Elantra and Toyota Prius. The Prius has a cool inverter that doubles as a home generator, so it is considered an asset. Oh, and staying home with the two Kids, I actually run more miles in a week than we drive Monday-Friday. CHEAP!
Love i love this. I am saving and would like to convince my husband to let me buy a piece of land to build an echo house! He likes his own comforts. I do like the idea of home schooling...but my kids are 21/22 i dont think they would appeciate it haha!
I also still love the idea of selling or renting the house and high-tailing it outta here for a few years when the kids are older. Live abroad. On the cheap. Another reason for homeschooling. And we do this on well under six figures.
Owning real estate can be a liability if you are in a downmarket. In Toronto, homeowners have increased their personal wealth over time once it's sold, but in the meantime can be 'house poor'. And about cars, they decrease in value over time but they are an evil necesity.
Yes agreed ! In the K it really is about when you buy houses at the moment it feels like chucking money into a drain.
Agreed. Mostly. And it all depends. We married in our thirties, a good age spread of nine years. We both had prior careers, then joined the military in the US. Because of the banksters' games, the American Dream is all but gone and we quickly realized that. We talked about expatriating after our one term of service. But our parents had good foresight. We both had scholarships to college and worked our tails off to graduate debt free, a little kick in the tail from family. Got jobs, rented some real dives. No debt! Then I started day trading (had just entered the workforce at age 20 with a BS degree) because the $16.49 an hour was not enough to live on (just shy of $35,000 a year here). I drive used cars to this day. We don't have a car payment and both vehicles are paid for, fifteen years old, about $10 a month for liability and a hundred bucks a year for tag and taxes. Because they are cars, we spend about $70 a month on fuel. We paid off our home that was purchased 3 years ago. I opted to stay home and raise kids. So, our income is easily half. But not really. We homeschool. Use cloth diapers. Line dry. I cook all meals at home and we buy in bulk, managing to eat on $10 a day for all four. We read (no television) and stay outdoors. We spend money on memberships to local venues like the zoo, aquarium, science center. Built a home gym to avoid monthly fees. Pay into several retirement vehicles (shout to Perpetual Assets and cryptos!). I don't shop. We go on cheap dates 1-2 times a month. I iron, mow, plumb, paint, garden, can, sew, play music, write, educate, cook, make baby food, manage money, help others where we can. My husband works. But I work! If I got paid, it would be near to $600,000 a year for all the little things and big things. Moms are worth multiple millions a year.
Yes, it all depends. Marriage is work. Family is work. Clean living in this world is WORK! But with God ALL THINGS ARE POSSIBLE.
The long and short of it. So here is the short: you CAN own a house and car and not get swallowed by either. Just be reasonable in ownership and a good steward of your blessings and they won't suck you dry.
I disagree with people who chime in that kids cost SO a much money. Hey, I'm way more costly without children - eating out, travel, shopping. But right now I'm not paying for daycare and we are not paying someone else to do all the stuff we can DIY.
I hope this helps! Don't get frustrated. The things of this Earth will all pass away.
I think your philosophy is great !
Let me see.. no house, no car, and no money!
Yep been there.....vicious circle sometimes! But not everyone needs a car, or a house that they own (with heavy mortagages.)