Arranging my money

[thyme4change]

Thanks - but sheesh! Just mention that you are buying new and it is like admitting that you are using credit cards to finance a lifestyle, and plan to declare bankruptcy and then do it all over again!

[wewillsee]

This topic is an easy one. I am assuming you are buying a Honda Pilot or Odyssey. Don't waste your time with a two or three year old one. Buy a new one because it will only cost a few grand more, you will get a full warranty, you will get the exact features/options/color you want, and there is no risk of how it was maintained. You will also get the best years of the car. Remember that back in 2008 and 2009 very few new cars were being sold therefore the prices of those used Hondas are really high right now. I would finance it for 5 years or so at the 2.9% rate or whatever you can negotiate it at. Check out edmunds.com and price out your vehicle and it will show you the true market value in your area and then negotiate it from there.

For the bathroom, pay cash and make sure all mold is adequately removed in the bathroom and surrounding area. You don't want to spend $15K and have the same problem resurface in a couple of years.

[Deleted]

"Just mention that you are buying new and it is like admitting that you are using credit cards to finance a lifestyle, and plan to declare bankruptcy and then do it all over again!"

LOL! On your old car post I'm the one who said compare the price of new and used and if it's only a few thousand more to buy new then buy new. You'll get 2 more years of use (say 30k @15k/yr) and you know who took care of it.

We buy new but keep the cars for 10+ years. For a 30k car that's only 3k year for peace of mind.

[thyme4change]

I do remember there were a few people who weren't horrified that I might {{gasp}} buy new. I really feel this car will be in our family for 15 years.

My Dad bought a 1966 Mustang - brand new, and we all took turns driving that car until my Dad finally sold it in 1991. Maybe he could have saved some dough back then and bought a used Edsel or something - but sometimes the best decisions can only be recognized in hind sight.

You'll get 2 more years of use (say 30k @15k/yr) and you know who took care of it.

This is probably the correct calcuation, but we don't drive very many miles. I will be surprised if we have 20k on this car on it's second birthday.

[whoisjohngalt]

I am all for you buying your new car and doing your bathroom (well, as long as I see the pics of the bathroom )

I don't get it, though, why you want to finance the car? Do you not like parting with cash or do you think you will need it in the next few years? I got a loan when we bought our new car, but it was 0%, so I was pretending that I am making money in my ING

Lena

[thyme4change]

I would have to sell off some funds. I don't like to do that, unless I have to.

[thyme4change]

Don't expect the pictures until much later in the summer. As I said before, I'm slow about decisions like this. We are now ordering all the stuff - tile, etc. We will wait until we have it all until we start construction.

[whoisjohngalt]

Well, I am not telling you anything you don't know, but if you will have a loss on those funds, it might not be such a terrible thing, if you need to offset some gains. I guess you can always take the loan and pay it off early, right?

Oh, I'll wait, you are doing "before and after", right?

Lena

[thyme4change]

I have the before pictures, I think. I don't know - I'm disorganized. I'll probably take another round of "before" pictures the day before they actually start, and then later wonder why I have two sets.

[whoisjohngalt]

BTW, are you getting a minivan? Bc if so, all bets are off, I just can't support such silly decisions

Lena

[swamp]

Don't be hatin' on the mommy van.

[thyme4change]

We threw the caveat that it had to have 4 wheel drive, just so we could avoid the van thing. Sorry proud mamas!

I did love the Toyota swagger wagon campaign. But, it wasn't enough to bring us around.

[Deleted]

Waaay too funny!

Yeah, I'm not a fan of used 4WDs especially. You just don't know what people have done to the cars. And NOT putting the car in 4WD from time to time can also be bad.

I'm pretty cheap with cars, eschewing most of the bells and whistles but I do maintain my cars. I don't know if you remember but we didn't sell our cars when we moved to Germany. I couldn't see us taking the depreciation hit at 3 and 4 years old and then turning around and buying a 6 and 7 year old car. We've got them parked at our parents' houses. Turns out after MIL's hand surgery she really couldn't drive her mobus Lexus SUV so she's been using DH's sedan. The only down side has been registering the car every year. Phoenix makes it a PITA to do out of state registration. And I have to do it every year. No two year registration.

[Lex Luthor]

Can I come negotiate for you? I consider it a sport, especially when I know I'll never see the sales person again.

LOL! I'm glad I'm not the only one. I've already helped buy two cars this year and neither was for me.

so I'll just accept we are getting screwed and try not to think about it.

The internet/email is your friend. I never even step foot into a dealer until I have the final price nailed down (including tax and options). You can send an offer from one dealer to another to see if they can beat another's offer by email/phone. I recently helped a family member purchase a new vehicle for invoice less 5% entirely by email/phone. And then the dealer drove that car 2 hours to deliver it to my family member - no going to the dealer, no negotiating in person, no financing office with all the different pitches - and most importantly no wasting your time. The vehicle was financed at 2.9% for 60 mos.

A site I like is truecar.com. It will tell you the factory invoice, the dealer cost, the average price paid, and the best price in your area right now for whatever make and model you are looking at. It will also tell you the invoice vs. retail price of each option on your vehicle.

You should also pay attention to all the tax rates in the Phoenix area, I think some are cities around 8.5%, but others are closer to 10%. Also, in the state of Arizona, if you trade in your car, you don't pay tax on the difference between the sale price and your trade-in value. So, basically your trade-in vehicle value is that value plus the tax savings.

With as large a safety net as you have. And with the security you have with your jobs. I would do the 2.9% deal AND I would do the tax-deductible HELOC for your home improvements.

[thyme4change]

Lex, you are the first vote for financing my poopin' room!

I was looking at my accounts this morning. I have about $10k in checking, which I thought half would be for the car, and the other half would be for the next payment for the bathroom. Then in my "emergency fund" savings, which I usually keep around $10k, I have $17k, thinking that was the rest of the bathroom. Now I have to decide if I want to invest some of that and use the HELOC. I got a lot more votes for cash for the bathroom.

[thyme4change]

Thanks for the tip about the trade-in coming off the taxable sale price. That will help when the guy low-balls us, I can add 9% onto that and use that as a comparable.

[Deleted]

"Now I have to decide if I want to invest some of that and use the HELOC. I got a lot more votes for cash for the bathroom."


Thyme, it doesn't have to be all or nothing. If you're more comfortable paying 10k cash towards the bath and adding 5k to the HELOC then do it. When we added on to our Bay Area house in 2001 the total costs came to about $100k. I paid $50k cash out of savings and did a HELOC for 50k justifying that the addition added 50k market value to the house. I pre-paid the HELOC by 30k in two years. Then just before we moved to AZ did a total refi incorporating the remaining 20k. Your situation is much simpler. Use the cash you're comfortable using and use the HELOC for the balance. You could pre-pay that amount over 1 or 2 years; whatever works with your schedule.

[cronewitch]

My HELOC is adjustable with prime so when I want to use it for a large purchase I just think about what happens when rates go up. I would sell investments to pay it off if it prime goes to about 6.

[wodehouse]

I like to arrange my money... little stacks of 20's, stacks of 10', stacks of 5's, and a stack of 1's. And I'll iron any that are too crumpled.

[thyme4change]

Real cash in large quantities give me the willies. I'm always afraid I'm going to lose it.

[azphx1972]

May 24, 2011 15:35:03 GMT -5 thyme4change said:

Real cash in large quantities give me the willies. I'm always afraid I'm going to lose it.

I'll hold it for you! ;D

[thyme4change]

Exactly! Willies!!!!!!!!!!

[azphx1972]

May 24, 2011 15:53:22 GMT -5 thyme4change said:

Exactly! Willies!!!!!!!!!!

As long as they're good ones... ;D

[The J]

I'd finance the bathroom on the HELOC. If, for some reasons, rates jumped up (which I don't really forsee happening in the near future, but what do I know....), you could then liquidate some funds and pay it off.

[Gardening Grandma]

May 24, 2011 15:35:03 GMT -5 thyme4change said:

Real cash in large quantities give me the willies. I'm always afraid I'm going to lose it.

I figure that is the one time in my life I'll get mugged. Or into an auto accident and it will get scattered.
The last time I had to carry a large amount of cash ($30,000) I was SO relieved to get to the bank..

[Gardening Grandma]

LOL! On your old car post I'm the one who said compare the price of new and used and if it's only a few thousand more to buy new then buy new. You'll get 2 more years of use (say 30k @15k/yr) and you know who took care of it.

I'm inclined to agree with this. For a Honda or Toyota, that depreciation the first few years isn't as much as for other brands. I just shudder when I look at the price of replacing my 2000 RAV4.

[runewell]

May 23, 2011 12:20:59 GMT -5 moneymaven said:

DS asked me to come along and told the sales person I was her sister, but also an attorney. Not true, but I deal with law and attorney's all day long in insurance.

So you lied. Great.