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Thread: Financial sense needed

  1. #1
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    Financial sense needed

    Afternoon all, Iím looking at the option of making a silly purchase of a mid life crisis car.

    I have a small mortgage left and have the option of paying the house off this summer in cash (my fixed term penalty period is up) or being less boring :)

    Any thoughts on the reality of the options or whether itís a bit silly? Iíve never spent over 25k on a car so itís a bit scary and Iím looking for objective help.

    The mortgage is 40k, 7y left at about 530 pm.

    The car is about 90k, so Iíd need to draw down around 50k.

    Iím 46 and would like to finish full time work in my mid 50s.

    I was thinking draw the 50, and do a 5y fixed at around 1k pm coveri the house and car.

    Happy to chat on pm.

    Thanks.

  2. #2
    Grand Master ryanb741's Avatar
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    Getting the car would be a stupid financial decision. Do it! You only live once:)

  3. #3
    My feeling is that the economy is going to tank in the next few years , so pay off the mortgage, or be in a position to, then you will have the security of a roof over your head

  4. #4
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    I find myself agreeing with Ryan

    Unless you're putting yourself in financial peril (you're clearly not) I'd say go for it if you really want it

  5. #5
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    Quote Originally Posted by adrianw View Post
    My feeling is that the economy is going to tank in the next few years , so pay off the mortgage, or be in a position to, then you will have the security of a roof over your head
    It depends on your appetite for risk but I'd lean this way. Plus if the economy does tank there may be many good car deals to be had.

  6. #6
    Grand Master Saint-Just's Avatar
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    I'd be with Adrian... Sorry.

    46 is nothing specific to celebrate, so call yourself "mortgage free" (that's worth celebrations in itself!) and start saving for a car for your fiftieth. By this time you will also have a little more visibility on how things turned out globally and will still be young enough to enjoy a new toy
    'Against stupidity, the gods themselves struggle in vain' - Schiller.

  7. #7
    Master mondie's Avatar
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    Go for it Pete, you are in a good financial position and your plan of consolidating will be the cheapest way into fun car ownership. What do you have in mind?

  8. #8
    Grand Master Passenger's Avatar
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    Depends on your priorities at the end of the day, how you view depreciating Vs appreciating assets, only you can decide. Personally, since you've asked, I'd sort the roof over my head first.

  9. #9
    Grand Master markrlondon's Avatar
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    Quote Originally Posted by adrianw View Post
    then you will have the security of a roof over your head
    But pete-r could always sleep in his car... ;-)

    Conventional financial prudence says pay off the mortgage.

    BUT... you never know how long you've got. You've got to cut loose and enjoy yourself eventually. If now is achievable then do it now, before it's too late.

    But please don't come looking for me if you do end up living in the car!
    Last edited by markrlondon; 28th April 2022 at 14:48.

  10. #10
    Grand Master JasonM's Avatar
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    Tough choice, but I think the satisfaction of being mortgage free would win out, double up your payments to go free in 3 1/2 years the. get a car after that using your 1k a month you would have spent.

  11. #11
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    It’s tricky isn’t it, as the above views confirm.

    I’m looking at a Porsche GT4 because of the following.

    Strong residuals today at least.
    Track warranty extendable to 15y though I’d likely sell the car before the end.
    Next model likely hybrid so waiting until I’m 50 may be too late.

    There’s nothing else I really want, and owning 3 Porsche’s in the past the non GT models don’t do it for me.

    If I use the cash to buy the house, I’m drawing down on the car so back to square one with a 90k debt either way.

    I could sell some watches and raise more funds but I think the money is better invested in them than a car.
    Last edited by pete-r; 28th April 2022 at 15:01.

  12. #12
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    Mortgage free does sound nice, but my mothers worsening health and the loom of care home costs ripping inter her estate make me thing ď**** itĒ, live for the now!

  13. #13
    Edited in light of OPs most recent post - sounds like a plan!

    Sent from my M2101K7BNY using Tapatalk
    Last edited by xxnick1975; 28th April 2022 at 15:05.

  14. #14
    Grand Master markrlondon's Avatar
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    Quote Originally Posted by pete-r View Post
    Mortgage free does sound nice, but my mothers worsening health and the loom of care home costs ripping inter her estate make me thing ď**** itĒ, live for the now!
    This sort of thing is now my thinking.

    I don't intend for this to become a whinge thread but I'll say this: By nature I've been a save-and-pay-off-debt person most of my life, on the assumption that I'd be able to enjoy the results some day. Well, some day is more or less here and it didn't pay off. So frag it, if I can enjoy myself now, to the extent that I can, then I do so now.

    On an amusing note of comparison, my mother had built up a mahoosive collection of towel sets, all stored for a rainy day. And yet she carried on using scratchy old towels, keeping the fresh, good ones for that rainy day. By the age of 80-something, I pointed out to her that the rainy day had come and she might as well go ahead and use her saved up luxurious towels.

    Enjoy it while you can enjoy it (without actually putting yourself at obvious risk).

  15. #15
    Grand Master Mr Curta's Avatar
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    If you don't have dependents then do whatever makes you feel good!

    In retrospect for us, paying off the mortgage early was one of the best decisions we've ever made. Life events since then have felt much more manageable with the security of owning the house.
    Inform - Educate - Entertain

  16. #16
    Get the Porsche. You only live once. You're only 46. £40k mortgage is nothing to have when you\re 46, pretty much mortgage free in my opinion! Man maths.

  17. #17
    Grand Master Mr Curta's Avatar
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    A good friend had a lightbulb moment in his early 50s and started to really enjoy spending his savings on treats for himself. A classic Mercedes, teeth tidied up, splashed out on top end hifi, visited far flung corners of the globe. He died of a massive and totally unexpected heart attack just a few years later, and to this day I take comfort that he had enjoyed his life very much.
    Inform - Educate - Entertain

  18. #18
    Grand Master wileeeeeey's Avatar
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    Go mental, get the car, enjoy your life.

    Canít take it with you and none of us know how long weíre around for, let alone around in good health for.

  19. #19
    Grand Master snowman's Avatar
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    Depends on how much you're paying on your mortgage really.

    I suspected it would be a Porsche and was ready to say, they're ten a penny, save your money (I wouldn't buy a 911 personally, I just don't like them to look at or drive), but that GT4 does look good.

    On the other hand, will it really be worth MORE in 5 years time than today? Why not clear your mortgage, do as St-Just says and save for it in 5 years time.

    Sure, it won't have the new car smell, but how much is that really worth?

    If you're convinced it's a rising investment, then why not?

    Quote Originally Posted by wileeeeeey
    Can’t take it with you and none of us know how long we’re around for, let alone around in good health for.
    That is true, but if you're gone tomorrow, will your loved ones thank you for leaving them a mortgage?

    Obviously, everyone's circumstances vary - Without knowing the OP's it's difficult to know if £50K is significant to him or not, I'd assume not, but not everyone is as rational and the very fact he's asking suggests it's not inconsequential.

    M
    Last edited by snowman; 28th April 2022 at 15:34.
    Breitling Cosmonaute 809 - What's not to like?

  20. #20
    Quote Originally Posted by pete-r View Post
    Afternoon all, Iím looking at the option of making a silly purchase of a mid life crisis car.

    I have a small mortgage left and have the option of paying the house off this summer in cash (my fixed term penalty period is up) or being less boring :)

    Any thoughts on the reality of the options or whether itís a bit silly? Iíve never spent over 25k on a car so itís a bit scary and Iím looking for objective help.

    The mortgage is 40k, 7y left at about 530 pm.

    The car is about 90k, so Iíd need to draw down around 50k.

    Iím 46 and would like to finish full time work in my mid 50s.

    I was thinking draw the 50, and do a 5y fixed at around 1k pm coveri the house and car.

    Happy to chat on pm.

    Thanks.

    My Dad always said ďThereís no pockets in shroudsĒ and was diagnosed with lung Cancer in February 2007, declared terminal in March and died on 18th April 2007 having been a non smoker.


    There are no pockets in a shroud.

  21. #21
    Get the car! maybe not a Porsche though!

    I had a work colleague who was mid 60's, his wife earned a very good salary and they just saved and saved. A few years ago he had a health scare and now they go on 3-4 holidays a year, moved a nicer house, got some classic cars and bikes. They still have a pot saved for their one child, but are enjoying life.

    If you have the money and it wont financially cripple you, go for it!

  22. #22
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    And once the mortgage and car are sorted its Cocaine and Hookers time

  23. #23
    I had my dream car at age 27 (Lancia Integrale Evo 2, since you ask) and didn't regret paying for it. I did however get bored and sold it on. Itch scratched forever.

    If you buy a GT4 you will either love it, keep it and pay off the mortgage or sell it in a year or two and... pay off the mortgage!

    Buying a Porsche is not like spending the money on a trip to Vegas, you will have an asset to sell. Depends on your circumstances though. I have a small mortgage left but any kind of financial decision like this would involve my wife and she'd need to be behind it 100% - or it would take the fun away!

  24. #24
    Funnily enough every time I umm and arr about buying an expensive item my wife is the first to say "there is no point in being the richest man in the graveyard"
    Last edited by adrianw; 28th April 2022 at 16:00.

  25. #25
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    Forget the car, pay off your mortgage and quit your job 😂

  26. #26
    The car is not a £90k decision. Putting aside strong residuals it will likely be worth 60k in 3 years. So itís a £30k decision

    As someone who had a Heart attack at 46 I would say live and enjoy it. If it comes a burden or you stop enjoying it then sell it.

    I always wanted a 911. I have now grown out of the idea as nowhere to drive fast and park it in town and some t*** will scratch it. But had I had the means to get one when I was younger I would have done.

    Itís not quite man maths but you need to re-frame your thoughts. It simply isnít a big financial step


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  27. #27
    Master Papa Hotel's Avatar
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    I'll never forget what my grandad said to me just before he passed away. "I wish I'd driven the Porsche less."

    True story.

  28. #28
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    The numbers are ballsy but I agree itís not the exposure it first seems, though canít say that with all cars.

    Nationwide will do 90k over 10y, 5y fixed term around 816pcm, so i think Iíd be paying about 8k interest on life of the loan.

    Add the depreciation and that would be the cost over 10y, but as mentioned above when petrol hits 2.50/l and other factors I might bail before then.

    I think if you compare to something else like a used McLaren, or an Aston or R8 etc the depreciation and running costs kill the deal.

    I donít have any kids so when I go the charities I support will be very happy with my will...

  29. #29
    Quote Originally Posted by dandanthewatchman View Post
    The car is not a £90k decision. Putting aside strong residuals it will likely be worth 60k in 3 years. So itís a £30k decision

    As someone who had a Heart attack at 46 I would say live and enjoy it. If it comes a burden or you stop enjoying it then sell it.

    I always wanted a 911. I have now grown out of the idea as nowhere to drive fast and park it in town and some t*** will scratch it. But had I had the means to get one when I was younger I would have done.

    Itís not quite man maths but you need to re-frame your thoughts. It simply isnít a big financial step


    Sent from my iPhone using TZ-UK mobile app


    The 30k point is a good one but youíd be looking at a few£k in maintenance costs too on a 90k wagon.

    It would be worth getting a lease quote.. if the depreciation covers the lease then you donít need to borrow that capitol.

    Just an option

  30. #30
    Grand Master Onelasttime's Avatar
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    Is there anyone else living in the home who might have an opinion on what happens with the mortgage, e.g. a partner or spouse?

  31. #31
    Pay your mortgage off, its good to be mortgage free and then do what ever you want, if you can enjoy life then enjoy it, I had my heart attack in 98 and I now appreciate every day knowing it could easily be my last (hopefully not).

  32. #32
    Craftsman T1ckT0ck's Avatar
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    My sister passed aged 49. A close friend passed a few weeks ago very suddenly also aged 49. I turned 50 a couple weeks back. It has been very sobering for me and my missus, we said we should just get on and live more for todayÖ easy to say, another thing to do, itís so easy to drift back into safe / cautious ways.


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  33. #33
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    Iíve just read that you donít have kids - makes financial planning a whole lot easier. Any charities, or nieces or nephews will be grateful for anything received thatís left.
    As for your dilemma - if you have enough of a pension, or equity in your home, others assets, or ideally a combination of all 3 that means doing this wonít lead you to struggle in retirement, then why not just go for it? In other words if youíve taken care
    of your future, then enjoy today.

    Alternatively if you want to be more cautious, see how the next few months play out as the economy may struggle and you may end up getting the car cheaper. Presumably youíll be able to increase your savings in that time so you can borrow less.

    Iím sure the way youíve worded the question,
    Youíve put a lot of thought into this and will make the right choice for you :-)

  34. #34
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    You only live once, if the wife is agreeable, go for the car.

  35. #35
    Grand Master hogthrob's Avatar
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    Have you looked at paying the mortgage off, and financing the car (lease or PCP)?

  36. #36
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    No real need to be mortgage-free at 46, unless you see your income reducing or not covering it comfortably.

    Porsche is an asset that can be sold, residuals of that model are very strong.

    Overall, if you crave that car - it is an easy decision I would say. Only thing I would say, if you are anything like me - you may get bored of the car in 2 years or less. Consider a variable mortgage or a 2 year deal if there is a chance that could happen, or you are stuck with a bigger mortgage than you necessarily need.

  37. #37
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    Quote Originally Posted by Boss13 View Post
    Only thing I would say, if you are anything like me - you may get bored of the car in 2 years or less. Consider a variable mortgage or a 2 year deal if there is a chance that could happen, or you are stuck with a bigger mortgage than you necessarily need.
    Thatís a really good point I had missed.

    Iím a civil servant since 1998 so the pension isnít as good as it was but Iím guessing still better than most.

    TZ is fantastic (when we arenít arguing over Rolexís 😀)

  38. #38
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    I bought a new car for nearly 60k last year it will be the only time I can afford to buy a car like that so just went for it, and managed to pay the house off a few months ago really looked forward to doing it to it and at least if everything goes t-ts up we still have somewhere to live im not bragging and know Iím in a very fortunate place to be unlike a lot of people that are living from hand to mouth.

  39. #39
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    I’ve asked my dealer for a slot so they are checking availability, and also lead time.

    If its 18 months then the interest rates might have changed considerably by then.

  40. #40

    Red face

    Life is short and very fragile. As has been highlighted above, you don't know if you'll have the health to enjoy the car in a few years (or even be alive) - so just do it!!

  41. #41
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    Get the motor, get anything else that floats your boat, its only tying up the capitol the cost is the spread between buy and sell, just dont buy a lime green ferrari with red hide or similar undesirable item, or a boat

  42. #42
    Master Lampoc's Avatar
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    Remortgage the house and buy a 911 Sport Classic for £200K+

  43. #43
    I may be the odd one out here but it seems to me that these days it doesnít really matter what you drive, all cars are much the same dealing with traffic jams, speed cameras, dash cams, cyclists, speed bumps. Also, I have realised that the difference in fun between driving a 20k Porker and driving a 90k Porker is approximately 3/5ths of bugger all, plus youíre less likely to worry parking 20k in the local supermarket car park. Iíd pay the mortgage off if you can, drive something just as much fun for a lot less cash and concentrate on finding a way to spend less hours working.

  44. #44
    Quote Originally Posted by Devonian View Post
    Iíve just read that you donít have kids - makes financial planning a whole lot easier.
    Not for everyone, donít feel itís my responsibility to leave them a wedge.

  45. #45
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    Being mortgage free is a beautiful place to be, it reduces stress and addresses the basic human needs, add the ability to love and be loved and you have 95% of all you need. The security of owning lowers the stress of changes in health and employment. No longer do I worry about not having a job from a financial perspective and knowing you can buy whatever you want (within reason) actually makes you want less materiel things and gravitate towards the more spiritual and emotional ones.

    When I had less I wanted more and now I have more I want less.

  46. #46
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    "When I had less I wanted more and now I have more I want less."


    Yeah pretty much

  47. #47
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    Quote Originally Posted by Kingstepper View Post
    Not for everyone, don’t feel it’s my responsibility to leave them a wedge.
    You’re right some people aren’t bothered about leaving their children anything. Very very few though. Being in financial services for. 30 years I’d say at least 95% are bothered, hence why I mentioned it.

  48. #48
    Slogged my guts out as a contractor (ran around the globe in cheap hotels eating sarnies from the supermarket for dinner never took time off) mortgage paid off by 40, was a good feeling for a couple of years, aged 46 the bad back Iíd had for years started causing mobility issues, 47 20 year marriage fell apart divorced shortly after, 49 bio therapy working brilliantly on the back, two mustangs and a discovery on the drive, mortgage and a lot happier - wish Iíd not been so obsessed with clearing the mortgage and enjoyed the money more when I was healthier. You canít take it with you, but they will take it off you when you need healthcare

  49. #49
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    I'd have to say I'd be surprised if you get an allocation for a GT4 at the moment.
    There will be a lot of folks in front of you in the queue and these are coming through at glacial pace at the moment due to the production issues and many expect the currrent orders as being unlikely to be fulfilled.
    If you did get an allocation then you will be more likely to make 20K on it than lose it.

    Regards the mortgage dilemma then if the interest rate is still low and you don't have much to pay back then I don't see a lot of point paying it off.
    Last edited by Hood; 28th April 2022 at 21:09.

  50. #50
    Quote Originally Posted by Devonian View Post
    Youíre right some people arenít bothered about leaving their children anything. Very very few though. Being in financial services for. 30 years Iíd say at least 95% are bothered, hence why I mentioned it.
    Being in the industry imagine you are more likely to see those who are bothered and making plans. Many people, like myself, have no dealings with financial advisors or similar.

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