Anyone into cars but not credit?

[kambites]

I've never taken credit to buy a car and probably never will, but I don't think there's anything particularly wrong with anyone else doing it. I buy my cars second-hand and keep them for a long time which makes credit far less attractive than it would be to the "buy a new car every three years" type people.

[berlintaxi]

Devil2575 said:

berlintaxi said:

WestyCarl said:

Money allows you to have fun, whatever that may be.

Exactly, mortgages have never been cheaper so why overpay when it costing a couple of nights out a year to service it at most.

A couple of nights out a year!?

Either you have a tiny mortgage or very expensive nights out.

Why overpay when borrowing is cheap? Because the more you pay off now when you can afford it the less you will be exposed if and when rates go up. Also overpaying gives you a buffer.

If you haven't factored in interest rates going up you are already over committed, the average mortgage in this country is £80,000, say you had fixed at around 1% - 1.5%, the interest is negligible, anyway you could fall under a bus tomorrow so why worry.

[Rawwr]

My Focus is on PCP

My Fireblade is on PCP

Every day I have the choice of using either a lovely Focus ST or a lovely Fireblade. Both of them are on 0%. Neither are in negative equity. If my entire life prolapsed tomorrow, I'd could clear the finance, sell each of them quickly for sub-market rate, and have excess cash from the action.

I'm comfortable with the way I've arranged this.

[WestyCarl]

Devil2575 said:

berlintaxi said:

WestyCarl said:

Money allows you to have fun, whatever that may be.

Exactly, mortgages have never been cheaper so why overpay when it costing a couple of nights out a year to service it at most.

A couple of nights out a year!?

Why overpay when borrowing is cheap? Because the more you pay off now when you can afford it the less you will be exposed if and when rates go up. Also overpaying gives you a buffer.

I spent my "overpayment buffer" on a 4 week holiday in the US with the family this year. Happy days

[Devil2575]

berlintaxi said:

If you haven't factored in interest rates going up you are already over committed, the average mortgage in this country is £80,000, say you had fixed at around 1% - 1.5%, the interest is negligible, anyway you could fall under a bus tomorrow so why worry.

Because statistically speaking you won't fall under a bus.

Using an unlikely event as a reason not to do something is nonsensical.

Besides I was simply giving reasons as to why someone might choose to overpay. Reducing the amount of interest you pay and shortening the length of the loan is a good thing and if as you say you're in a good position why not do this? If it's an either or situation i.e. having fun is at the expense of overpaying then you're probably not as comfortable as you think. By "you" I'm talking generally btw.

How many people have fixed at 1%?

[DonkeyApple]

Devil2575 said:

berlintaxi said:

If you haven't factored in interest rates going up you are already over committed, the average mortgage in this country is £80,000, say you had fixed at around 1% - 1.5%, the interest is negligible, anyway you could fall under a bus tomorrow so why worry.

Because statistically speaking you won't fall under a bus.

Using an unlikely event as a reason not to do something is nonsensical.

Besides I was simply giving reasons as to why someone might choose to overpay. Reducing the amount of interest you pay and shortening the length of the loan is a good thing and if as you say you're in a good position why not do this? If it's an either or situation i.e. having fun is at the expense of overpaying then you're probably not as comfortable as you think. By "you" I'm talking generally btw.

How many people have fixed at 1%?

Both are correct views in reality but the nub is whether this 'excess' money is net of the investment in future monthly income in retirement. This is really where the confusion in the UK over 'affordability' arises. Most people will stop earning a salary some time in their 60s but statistically live into their 80s so some form of savings are required to simulate a monthly income. Relying on the improbability of dieing while still in work isn't that smart a move.

There is always much discussion in these threads about what is left after thebmortgage and bills as being free money to spend but you have to include your saving for future income in retirement (if you wish to remain independent) in that calculation before you see the actual amount of remaining money for having fun with.

On PH many will brag about their mortgage or their cars etc but it is rare to see anyone bragging about their pension contributions, which in reality, is the real symbol of wealth. About one in five in the U.K. have no pension and of those who do very few are contributing enough to maintain any form of lifestyle commensurate with their current lifestyle.

If people are investing in their pension properly then any cash left over each month is technically free money to invest in life's pleasures. If people are not but choosing to spend that money on life's luxuries then this is not affordable and they are spending their future income to fuel an artificially inflated lifestyle.

[SWoll]

DonkeyApple said:

About one in five in the U.K. have no pension and of those who do very few are contributing enough to maintain any form of lifestyle commensurate with their current lifestyle.

My issue with that is that I won't require a lifestyle commensurate with my current situation. I won't have 2 teenage kids to support, won't need a 5 bedroom home, won't need 2 cars that cover 40K a year between them and any number of other things that are currently necessary or luxuries.

Of course pension contributions are important but I do think a lot of people get so caught up in the future they forget to enjoy themselves while they are young and healthy enough to do so.

[DonkeyApple]

SWoll said:

DonkeyApple said:

About one in five in the U.K. have no pension and of those who do very few are contributing enough to maintain any form of lifestyle commensurate with their current lifestyle.

My issue with that is that I won't require a lifestyle commensurate with my current situation. I won't have 2 teenage kids to support, won't need a 5 bedroom home, won't need 2 cars that cover 40K a year between them and any number of other things that are currently necessary or luxuries.

Of course pension contributions are important but I do think a lot of people get so caught up in the future they forget to enjoy themselves while they are young and healthy enough to do so.

Totally agree with the first part but there is no suggestion that the income needed will be as high as the income needed while raising children and paying the mortgage etc. But most people will have an expectation of maintaining a similar lifestyle as opposed to moving into sheltered accommodation and claiming benefits so that wealth still needs to be accumulated. The conventional figure is about 20% of income is required.

On the second part, I would argue that it is the exact opposite. Declining savings levels, declining pension contributions, increased debt financing and increased consumption all point to people over doing it and getting the balance wrong. I think that the very issue we have is that so few are thinking of their future and have chosen to live a lifestyle that historically is only viable to gay men and women with big tits. If you've got no income when you retire then without a cute arse or big knockers who is going to pay your bills?

I'm a massive believer in us being free to live how we wish to live but this shouldn't negate personal responsibilities, especially as a man both today and tomorrow and all the data points to us collectively sitting on the wrong side of the scales at present.

[walm]

DonkeyApple said:

The conventional figure is about 20% of income is required.

Sorry, to be clear - that's the amount of net income we should be putting into savings - as a rough rule of thumb?

[Zod]

DonkeyApple said:

On PH many will brag about their mortgage or their cars etc but it is rare to see anyone bragging about their pension contributions, which in reality, is the real symbol of wealth. About one in five in the U.K. have no pension and of those who do very few are contributing enough to maintain any form of lifestyle commensurate with their current lifestyle.

.

I would never brag about my pension contributions, in part because, thanks to George Osborne and the greed of asset managers, even though I pay in the maximum, every time I look at my pension statement, the total seems barely to have increased and the note on how much I could receive if I continue to contribute at the current rate makes me hope forlornly I have misread the per annum figure and that it is in fact a per month figure.

[ChasW]

DonkeyApple said:

SWoll said:

DonkeyApple said:

About one in five in the U.K. have no pension and of those who do very few are contributing enough to maintain any form of lifestyle commensurate with their current lifestyle.

My issue with that is that I won't require a lifestyle commensurate with my current situation. I won't have 2 teenage kids to support, won't need a 5 bedroom home, won't need 2 cars that cover 40K a year between them and any number of other things that are currently necessary or luxuries.

Of course pension contributions are important but I do think a lot of people get so caught up in the future they forget to enjoy themselves while they are young and healthy enough to do so.

Totally agree with the first part but there is no suggestion that the income needed will be as high as the income needed while raising children and paying the mortgage etc. But most people will have an expectation of maintaining a similar lifestyle as opposed to moving into sheltered accommodation and claiming benefits so that wealth still needs to be accumulated. The conventional figure is about 20% of income is required.


On the second part, I would argue that it is the exact opposite. Declining savings levels, declining pension contributions, increased debt financing and increased consumption all point to people over doing it and getting the balance wrong. I think that the very issue we have is that so few are thinking of their future and have chosen to live a lifestyle that historically is only viable to gay men and women with big tits. If you've got no income when you retire then without a cute arse or big knockers who is going to pay your bills?

I'm a massive believer in us being free to live how we wish to live but this shouldn't negate personal responsibilities, especially as a man both today and tomorrow and all the data points to us collectively sitting on the wrong side of the scales at present.

Well put.

I am reaching the back end of my full-time working life and while I have been provident, with a full pension pot etc, I am looking at living on half current income the moment I retire. What worries me is that I have mates whose spend on flash cars/holidays/entertainment etc is far greater than mine yet their pension provision is less than half mine, at best. I get the "live now" message to a point, but most of these people I refer to will be fit and healthy retirees with 25-30 years to live once they stop earning. I guess they transition from petrol heads to ramblers!

[DonkeyApple]

walm said:

DonkeyApple said:

The conventional figure is about 20% of income is required.

Sorry, to be clear - that's the amount of net income we should be putting into savings - as a rough rule of thumb?

I've always considered the rates to be based on gross income but either way that average of 20% varies quite dramatically dependent on when someone starts doesn't it?

[walm]

DonkeyApple said:

walm said:

DonkeyApple said:

The conventional figure is about 20% of income is required.

Sorry, to be clear - that's the amount of net income we should be putting into savings - as a rough rule of thumb?

I've always considered the rates to be based on gross income but either way that average of 20% varies quite dramatically dependent on when someone starts doesn't it?

Sure. Just wondered.

And I guess into a pension some of it gets grossed up.
Although if not and if you are [/PH Director] - then say on £100k gross that's £20k on £65k net or 31% of net!
I seriously doubt many on here are saving that much!!
(Although as you say, they perhaps should be...)

[Herbs]

ChasW said:

DonkeyApple said:

SWoll said:

DonkeyApple said:

About one in five in the U.K. have no pension and of those who do very few are contributing enough to maintain any form of lifestyle commensurate with their current lifestyle.

My issue with that is that I won't require a lifestyle commensurate with my current situation. I won't have 2 teenage kids to support, won't need a 5 bedroom home, won't need 2 cars that cover 40K a year between them and any number of other things that are currently necessary or luxuries.

Of course pension contributions are important but I do think a lot of people get so caught up in the future they forget to enjoy themselves while they are young and healthy enough to do so.

Totally agree with the first part but there is no suggestion that the income needed will be as high as the income needed while raising children and paying the mortgage etc. But most people will have an expectation of maintaining a similar lifestyle as opposed to moving into sheltered accommodation and claiming benefits so that wealth still needs to be accumulated. The conventional figure is about 20% of income is required.


On the second part, I would argue that it is the exact opposite. Declining savings levels, declining pension contributions, increased debt financing and increased consumption all point to people over doing it and getting the balance wrong. I think that the very issue we have is that so few are thinking of their future and have chosen to live a lifestyle that historically is only viable to gay men and women with big tits. If you've got no income when you retire then without a cute arse or big knockers who is going to pay your bills?

I'm a massive believer in us being free to live how we wish to live but this shouldn't negate personal responsibilities, especially as a man both today and tomorrow and all the data points to us collectively sitting on the wrong side of the scales at present.

Well put.

I am reaching the back end of my full-time working life and while I have been provident, with a full pension pot etc, I am looking at living on half current income the moment I retire. What worries me is that I have mates whose spend on flash cars/holidays/entertainment etc is far greater than mine yet their pension provision is less than half mine, at best. I get the "live now" message to a point, but most of these people I refer to will be fit and healthy retirees with 25-30 years to live once they stop earning. I guess they transition from petrol heads to ramblers!

It's tricky for sure - i'm a person who for various reasons (that i won't bore you with) haven't bothered with a pension but prefer investing some in property. Regardless of that it's a decision I made when i was younger which was to enjoy the 60+ years at the start of my life whilst i am fit and healthy and young enough to enjoy it - if that means that I have to tighten my belt in later life then i will happily do so as it means I am still alive past the point I expected not to be - win/win

[SWoll]

Herbs said:

ChasW said:

DonkeyApple said:

SWoll said:

DonkeyApple said:

About one in five in the U.K. have no pension and of those who do very few are contributing enough to maintain any form of lifestyle commensurate with their current lifestyle.

My issue with that is that I won't require a lifestyle commensurate with my current situation. I won't have 2 teenage kids to support, won't need a 5 bedroom home, won't need 2 cars that cover 40K a year between them and any number of other things that are currently necessary or luxuries.

Of course pension contributions are important but I do think a lot of people get so caught up in the future they forget to enjoy themselves while they are young and healthy enough to do so.

Totally agree with the first part but there is no suggestion that the income needed will be as high as the income needed while raising children and paying the mortgage etc. But most people will have an expectation of maintaining a similar lifestyle as opposed to moving into sheltered accommodation and claiming benefits so that wealth still needs to be accumulated. The conventional figure is about 20% of income is required.


On the second part, I would argue that it is the exact opposite. Declining savings levels, declining pension contributions, increased debt financing and increased consumption all point to people over doing it and getting the balance wrong. I think that the very issue we have is that so few are thinking of their future and have chosen to live a lifestyle that historically is only viable to gay men and women with big tits. If you've got no income when you retire then without a cute arse or big knockers who is going to pay your bills?

I'm a massive believer in us being free to live how we wish to live but this shouldn't negate personal responsibilities, especially as a man both today and tomorrow and all the data points to us collectively sitting on the wrong side of the scales at present.

Well put.

I am reaching the back end of my full-time working life and while I have been provident, with a full pension pot etc, I am looking at living on half current income the moment I retire. What worries me is that I have mates whose spend on flash cars/holidays/entertainment etc is far greater than mine yet their pension provision is less than half mine, at best. I get the "live now" message to a point, but most of these people I refer to will be fit and healthy retirees with 25-30 years to live once they stop earning. I guess they transition from petrol heads to ramblers!

It's tricky for sure - i'm a person who for various reasons (that i won't bore you with) haven't bothered with a pension but prefer investing some in property. Regardless of that it's a decision I made when i was younger which was to enjoy the 60+ years at the start of my life whilst i am fit and healthy and young enough to enjoy it - if that means that I have to tighten my belt in later life then i will happily do so as it means I am still alive past the point I expected not to be - win/win

Certainly something to think about.

I'm a good 20-25 years away from retirement yet and don't contribute as much as I probably should at present due to having teenage kids etc. My though process is that based on my current career trajectoy, my kids being self sufficient in the next 5-10 years and my house being paid off in a similar period, my ability to pay in will improve massively, therefore I'm going to continue to enjoy things for the moment and not worry about it.

[DonkeyApple]

SWoll said:

Herbs said:

ChasW said:

DonkeyApple said:

SWoll said:

DonkeyApple said:

About one in five in the U.K. have no pension and of those who do very few are contributing enough to maintain any form of lifestyle commensurate with their current lifestyle.

My issue with that is that I won't require a lifestyle commensurate with my current situation. I won't have 2 teenage kids to support, won't need a 5 bedroom home, won't need 2 cars that cover 40K a year between them and any number of other things that are currently necessary or luxuries.

Of course pension contributions are important but I do think a lot of people get so caught up in the future they forget to enjoy themselves while they are young and healthy enough to do so.

Totally agree with the first part but there is no suggestion that the income needed will be as high as the income needed while raising children and paying the mortgage etc. But most people will have an expectation of maintaining a similar lifestyle as opposed to moving into sheltered accommodation and claiming benefits so that wealth still needs to be accumulated. The conventional figure is about 20% of income is required.


On the second part, I would argue that it is the exact opposite. Declining savings levels, declining pension contributions, increased debt financing and increased consumption all point to people over doing it and getting the balance wrong. I think that the very issue we have is that so few are thinking of their future and have chosen to live a lifestyle that historically is only viable to gay men and women with big tits. If you've got no income when you retire then without a cute arse or big knockers who is going to pay your bills?

I'm a massive believer in us being free to live how we wish to live but this shouldn't negate personal responsibilities, especially as a man both today and tomorrow and all the data points to us collectively sitting on the wrong side of the scales at present.

Well put.

I am reaching the back end of my full-time working life and while I have been provident, with a full pension pot etc, I am looking at living on half current income the moment I retire. What worries me is that I have mates whose spend on flash cars/holidays/entertainment etc is far greater than mine yet their pension provision is less than half mine, at best. I get the "live now" message to a point, but most of these people I refer to will be fit and healthy retirees with 25-30 years to live once they stop earning. I guess they transition from petrol heads to ramblers!

It's tricky for sure - i'm a person who for various reasons (that i won't bore you with) haven't bothered with a pension but prefer investing some in property. Regardless of that it's a decision I made when i was younger which was to enjoy the 60+ years at the start of my life whilst i am fit and healthy and young enough to enjoy it - if that means that I have to tighten my belt in later life then i will happily do so as it means I am still alive past the point I expected not to be - win/win

Certainly something to think about.

I'm a good 20-25 years away from retirement yet and don't contribute as much as I probably should at present due to having teenage kids etc. My though process is that based on my current career trajectoy, my kids being self sufficient in the next 5-10 years and my house being paid off in a similar period, my ability to pay in will improve massively, therefore I'm going to continue to enjoy things for the moment and not worry about it.

And I think that is perfectly prudent and very common for most people who already contribute to a pension to act.

There is an elevated risk due to the fact that the point you identify in the future for when to start making elevated contributions is also the highest risk point in terms of salary fall as you are at the age and career level when it becomes much harder to adapt/compensate for being laid off or being ill and for a number of people this plan will fail because of that. The even more prudent action would be to cover the pension aspect now and use the excess income later, should it appear, to spend on excess fun & frivolities etc

But a very significant number of people are nowhere neither either option and it does mean for them that the money they are spending each month on excess fun and frivolities isn't 'affordable' because it is the money that would be forming the basis of their income after being retired (fewer and fewer people get to retire when they want to, most are retired by their employers far earlier than ideally planned).

So my interest in these types of threads is always what someone means by 'afford the monthly cost' as I don't think this is technically correct in reality. And if we are facing what seems to be a looming issue of more and more people being retired before they have enough to self finance their existence then everyone else is going to be picking up the tab which is where I suspect a lot of concern from others lies rather than people actually being envious of someone having a newer car?

[anonymous-user]

DonkeyApple said:

I'm a massive believer in us being free to live how we wish to live but this shouldn't negate personal responsibilities, especially as a man both today and tomorrow and all the data points to us collectively sitting on the wrong side of the scales at present.

This is what bothers me. There's a whole generation of disenfranchised 20 somethings who've resigned themselves to the belief that they will never own their own home and feel no need to plan for a future they have no control over. This is made worse by globalised, corporate greed by organisations with no social or moral responsibility. Credit is cheap and accessible to people who are too dumb to understand or don't care about planning for their future.

What's going to happen in 30 years when most people of retirement age can neither work or afford to support themselves? Everything will be taxed, even our pensions to redistribute wealth to these idiots and we'll all live in poverty.

[Audemars]

People assume they have a job for life or can get a new job till they retire.

I expect most we be sacked between 40-50yrs old and will be unable to find a new job with similar renumeration. Can you folks support yourself for 1 to 2 years with no income?

Also to earn minimum wage in retirement you need a pension pot of around £220k. How many will accumulate £220k? Even a £500k pension pot will be a poor amount to live on.

Of course you can get struck by lighting tomorrow so all the above does not matter.

There is absolutely no reason why a young kid/young adult should be buying a new car on finance given the plentiful £1k cars out there.

[walm]

Audemars said:

People assume they have a job for life or can get a new job till they retire.

I expect most we be sacked between 40-50yrs old and will be unable to find a new job with similar renumeration. Can you folks support yourself for 1 to 2 years with no income?

Also to earn minimum wage in retirement you need a pension pot of around £220k. How many will accumulate £220k? Even a £500k pension pot will be a poor amount to live on.

Of course you can get struck by lighting tomorrow so all the above does not matter.

There is absolutely no reason why a young kid/young adult should be buying a new car on finance given the plentiful £1k cars out there.

Reported.





(For being a gargantuan douche.)

[Rawwr]

Audemars said:

renumeration