Midlife non crisis...
Discussion
Long time lurker, first time poster....
I bought a 1.4ACT Leon FR new back at the end of 2014 and it has done everything I have needed over that time. 40mpg, quick enough for my cross country drive to work etc and reliable.
As it comes up to 5 years old I'm considering changing it for something else from a more "premium" brand thats a couple of years old for around £20k financed from savings.
I find that I am hesistating to do this as I am concerned I'd buy a lemon. Having considered reducing the risk by looking at approved used cars I still see you can be left with a massive bill for say a clutch a few months after buying.
I guess i also have a part of me that wonders if I would be better off investing the cash as I may need it more in 25 years when I retire, mind you I may also not make it to that point!
Its kind of all wrapped up with a close relative passing away recently at a young age so I have a conflict between "you only live once" and save for retirement!
What are peoples opinions?
1. Save save save. Keep the car I know that has been treated well, serviced on the dot etc and run it into the ground.
2. You only live once. Buy something else of unknown history but that I may enjoy driving / owning more.
I bought a 1.4ACT Leon FR new back at the end of 2014 and it has done everything I have needed over that time. 40mpg, quick enough for my cross country drive to work etc and reliable.
As it comes up to 5 years old I'm considering changing it for something else from a more "premium" brand thats a couple of years old for around £20k financed from savings.
I find that I am hesistating to do this as I am concerned I'd buy a lemon. Having considered reducing the risk by looking at approved used cars I still see you can be left with a massive bill for say a clutch a few months after buying.
I guess i also have a part of me that wonders if I would be better off investing the cash as I may need it more in 25 years when I retire, mind you I may also not make it to that point!
Its kind of all wrapped up with a close relative passing away recently at a young age so I have a conflict between "you only live once" and save for retirement!
What are peoples opinions?
1. Save save save. Keep the car I know that has been treated well, serviced on the dot etc and run it into the ground.
2. You only live once. Buy something else of unknown history but that I may enjoy driving / owning more.
Edited by MattTwo on Wednesday 3rd July 18:33
Have it both ways.
Preserve your capital and invest it how you wish. Decide how much per month you can afford to spend on a car and borrow the money instead. You may not win on the interest but at least the balance between spend and save is more transparent.
Otherwise how are you going to fund your next car in 5 years time when you are fed up with this one or it's worn out?
Preserve your capital and invest it how you wish. Decide how much per month you can afford to spend on a car and borrow the money instead. You may not win on the interest but at least the balance between spend and save is more transparent.
Otherwise how are you going to fund your next car in 5 years time when you are fed up with this one or it's worn out?
That £20k cash is £85,837.41 in 25 years at 6% interest. Ask yourself if whatever car you buy is worth cutting your retirement short by the time it may take you to earn that. That doesn't even account for any employer contribution matches and tax relief (and conversely, it also doesn't account for inflation).
Thanks chaps.
It was the compounding that I was considering as a reason not to do it. My figures were based on 13k as a price to change rather than 20k and a 4% annual giving me 35k extra at 25 years.
I am leanjng towards keeping it at the moment but have that nagging feeling I will regret it some day.
It was the compounding that I was considering as a reason not to do it. My figures were based on 13k as a price to change rather than 20k and a 4% annual giving me 35k extra at 25 years.
I am leanjng towards keeping it at the moment but have that nagging feeling I will regret it some day.
I've always tended to buy a bit older so I can afford a better model - after all it's not like 21st Century cars rot away or have engines that die at 100,000 miles!
Only you can decide what level of risk you are comfortable with, but I've definitely moved more towards the "only live once" approach as I've aged.
I have far more regrets over things I didn't do than over things I did!
Only you can decide what level of risk you are comfortable with, but I've definitely moved more towards the "only live once" approach as I've aged.
I have far more regrets over things I didn't do than over things I did!
Sure it's sensible thinking about the future but life doesn't start after retirement. I agree that going slightly older can get you a lot more car for your money and reliably can be fine if looked after.
Why not compromise and chuck £10k at something like an 8 year old well spec'd premium car and put the other £10k in a SIPP with someone like Andrew Bell. They've got a great platform and their managed funds will make that money work well for you.
Why not compromise and chuck £10k at something like an 8 year old well spec'd premium car and put the other £10k in a SIPP with someone like Andrew Bell. They've got a great platform and their managed funds will make that money work well for you.
MattTwo said:
What are peoples opinions?
1. Save save save. Keep the car I know that has been treated well, serviced on the dot etc and run it into the ground.
2. You only live once. Buy something else of unknown history but that I may enjoy driving / owning more.
To answer that question we would need to know approximately the extent of your other savings, and in particular your pension savings.1. Save save save. Keep the car I know that has been treated well, serviced on the dot etc and run it into the ground.
2. You only live once. Buy something else of unknown history but that I may enjoy driving / owning more.
If you are on track to cover what you will need in older age, then using some of your savings to buy a better car might be reasonable. If not, buying a newer car would be indulgent.
You’ve really not got the hang of this mid-life crisis thing, have you?
You’re supposed to come up with a range of contorted rationalisations why it IS a good idea to get eg a bright red ‘69 Mustang in terrible condition. What you’re doing is coming up with concerns about why is ISN’T a good idea to trade in a 2014 Leon.
If you’re worrying the money would be better put in the pension, you may not be ready for his whole midlife crisis thing at all yet. I’d hold off buying anything until you are. The Leon is undoubtedly a much better use of the money.
You’re supposed to come up with a range of contorted rationalisations why it IS a good idea to get eg a bright red ‘69 Mustang in terrible condition. What you’re doing is coming up with concerns about why is ISN’T a good idea to trade in a 2014 Leon.
If you’re worrying the money would be better put in the pension, you may not be ready for his whole midlife crisis thing at all yet. I’d hold off buying anything until you are. The Leon is undoubtedly a much better use of the money.
MattTwo said:
Thanks chaps.
It was the compounding that I was considering as a reason not to do it. My figures were based on 13k as a price to change rather than 20k and a 4% annual giving me 35k extra at 25 years.
I am leanjng towards keeping it at the moment but have that nagging feeling I will regret it some day.
Have you considered a second car? I'm a recent convert to a regular, reliable and frugal daily and a more fun second car. I've bought an old MX5 and I absolutely love it. I think most people would agree the new car feeling wears off pretty quickly so just buy something you will enjoy, and outright speed does not = more enjoyment. I'd save a bit and buy something for much less as a second novelty car. If you buy well it won't depreciate much. As an idea you could buy a lovely Elise for £13-15k which won't cost much to run and will hold its value or you could have nearly as much fun in a well specced and even more reliable Mk3 MX5 for £5k. On a low miles policy with an insurance specialist it'll be cheap to insure, road tax is reasonable etc. If you change your mind it's an easy decision to reverse, by contrast if you buy a more premium used car at about £20k at a few years old it will have a lot more depreciation to go, so if you end up with cold feet it could cost you a lot to undo.It was the compounding that I was considering as a reason not to do it. My figures were based on 13k as a price to change rather than 20k and a 4% annual giving me 35k extra at 25 years.
I am leanjng towards keeping it at the moment but have that nagging feeling I will regret it some day.
bluezedd said:
That £20k cash is £85,837.41 in 25 years at 6% interest. Ask yourself if whatever car you buy is worth cutting your retirement short by the time it may take you to earn that. That doesn't even account for any employer contribution matches and tax relief (and conversely, it also doesn't account for inflation).
Where are you getting a 6% yield? 67Dino said:
You’ve really not got the hang of this mid-life crisis thing, have you?
You’re supposed to come up with a range of contorted rationalisations why it IS a good idea to get eg a bright red ‘69 Mustang in terrible condition. What you’re doing is coming up with concerns about why is ISN’T a good idea to trade in a 2014 Leon.
If you’re worrying the money would be better put in the pension, you may not be ready for his whole midlife crisis thing at all yet. I’d hold off buying anything until you are. The Leon is undoubtedly a much better use of the money.
Nicely put. You’re supposed to come up with a range of contorted rationalisations why it IS a good idea to get eg a bright red ‘69 Mustang in terrible condition. What you’re doing is coming up with concerns about why is ISN’T a good idea to trade in a 2014 Leon.
If you’re worrying the money would be better put in the pension, you may not be ready for his whole midlife crisis thing at all yet. I’d hold off buying anything until you are. The Leon is undoubtedly a much better use of the money.
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